The key to harmony among asset managers and intermediaries – and in their relationships with end-investors – is a clear understanding of their distinct places in the value chain, believes Peter Walsh. “From the intermediary perspective, there is very obvious value-add for their clients in terms of the complexities around structuring tax considerations, meeting regulatory requirements and so on,” he says.
“That is quite distinct from the role of the asset manager, which is basically finding and generating alpha for those clients. As long as each party continues to find ways to differentiate themselves, to meet client needs and to add value, there should be a strong and harmonious relationship between them and end-investors – but, to me, it is their very distinct roles in the value chain that should ultimately serve to put clients in a better position.”
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Walsh joined Robeco as global head of consultant relations in 2014 before being appointed, three years later, to his current role of managing director and head of the Dutch asset management giant’s UK office with a brief to expand the business. After starting his asset management career with Aviva Australia back in 1992, he has also held senior roles at Zurich Financial Services, Putnam Investments and Treasury Group.
It is one thing to talk about adding value but how can asset managers demonstrate they are doing so in practice? “One of the key concepts of adding value is ‘winning by not losing’,” replies Walsh. “The role of ‘not losing’ is often understated in our industry but being very aware of potential downside and looking to ensure portfolios are not going to be hit by drawdowns is what delivers for clients in the long term.
“That does not necessarily mean you have to be overly defensive – just that you demonstrate you add value less through a focus on pure alpha and bursts of outperformance than with through-the-cycle performance, including in difficult times. At Robeco, we have a strong track record in that across a range of different asset classes – across credit, across emerging markets, across our quant strategies and so on.”
Read the full article in Portfolio Adviser’s June 2023 magazine
