We do not believe that it is possible for any single investment management firm to employ leading specialists across every asset class and geographical region. Specialist investment managers are devoted experts in a single area, and as such are better equipped than the generalists often found in the larger institutions. This can be illustrated by considering one of the greatest decathletes of all time, Daley Thompson, and comparing his results in the individual events to that of the world champion for each event. Daley's results were worse in every discipline, being outperformed by the world champion by as much as 50% in some disciplines.
Insinger de Beaufort was one of the early followers of a manager selection philosophy. A dedicated team of analysts and fund managers operates predominantly from our Amsterdam head office.
Quantitative analysis
Within each investment universe we analyse the historical performance of different managers. The objective is not only to establish the best performers, but also to consider the risk associated with their investment strategy. Of particular interest is the performance of managers within adverse market circumstances.
Within this part of our process we also analyse the investment style of a manager. This furthers the understanding of how investment returns are generated and whether they might be stable in the future.
Manager interviews
All potential managers are interviewed in person. The objective is to establish the ability of the manager, to check the implementation of investment policy and to investigate risk controls. Our research analysts thoroughly prepare for each interview and seek further understanding of how the fund manager makes money.
Manager Portfolio Analysis
As part of our investigation, we analyse the individual holdings of each manager 's portfolio. We need to understand the rationale behind the holdings and how they relate to the manager's investment philosophy. Many fund manager candidates fail to be selected by our analysts because of inconsistent holdings, which cannot be explained.
Financial stability
Our compliance team, in Amsterdam, considers the manager's accounts and prospectuses to ensure financial stability. We also assess any operational risks that may exist. This is particularly relevant in the field of alternative investments and hedge funds.
