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Spotlight on... investment track record

In challenging marketing conditions, investors typically seek greater transparency and credibility from their investment advisers.  Working closely with intermediaries we are ideally placed to adapt to your clients' changing demands and the ever-increasing sophistication in the asset management arena. At Fairbairn Private Bank we manage clients' assets in line with three fundamental investment principles:

  1. Asset allocation is the key driver of investment performance
  2. Multi-asset class investing diversifies risk and maximises the opportunities to deliver attractive risk-adjusted returns
  3. Passive or index tracking funds will commonly outperform actively managed funds in developed markets.

Adhering to these principles can never remove the possibility of periods of negative returns in certain market conditions. However, over time, they have been proven to create an effective framework for optimising investment return for given levels of investor risk.

Based on a 'core and explore' approach to investment management, we combine our experience and understanding of your clients' needs with our own style and philosophy of investment management to construct an innovative and adaptable service. Firstly, risk is diffused through diversification and measured using rolling volatility.  Secondly, the mix of passive and active investments across all asset classes enables us to provide a cost-effective core investment solution. Finally, individual thematic exposures are selected to express our views regarding fundamental market drivers over the forthcoming period.

A meaningful track record, typically in excess of three years, will be used by prudent intermediary investors to judge the success of a manager's process. The success demonstrated in the three years prior to 2009 and our credible focus on transparency and genuine risk management allowed Fairbairn Private Bank, in 2009, to have strong growth in our discretionary investment assets under management. This was partly driven by our valued intermediary clients and the trust they place in our business, something we are confident of building upon through 2010 and beyond.

In order to assist you to calibrate the performance across all our major risk models (ie, Low-Medium, Medium-High and High Risk) we include comparables, tabulated below, which measure the performance of Fairbairn Private Bank Composites(1) relative to our peer group, as measured by the ARC Private Client Indices(2). As illustrated by the performance matrix, we compare favourably amongst our peer group and have demonstrated robust performance through the measurement period.

If our wealth management service appeals to your clients, please call us on +44 (0) 1624 645000 or, alternatively, details are available online.

(1) Fairbairn Private Bank Composites are an aggregation of actual portfolios managed by Fairbairn Private Bank. They are calculated by weighting the returns from all actual fee-paying discretionary portfolios managed to the relevant strategy by beginning market value and time-weighted cash flows. Returns are net of investment management, custody, administrative fees, trading expenses, and non-reclaimable withholding taxes.

(2) The ARC PCI Indices are a series of indices calculated by Asset Risk Consultants. They compile data from over 20 contributing asset management houses, collating the net-of-fees returns of more than 25,000 private client portfolios. These returns are then grouped according to risk. All the major investment styles, approaches and philosophies are represented. Data for the last quarter 2009 is estimated data published by ARC. More information can be found at http://www.assetrisk.com/

Fairbairn Private Bank believes the ARC PCI Indices to be relevant comparators to assist investors calibrate performance against its composites, however, it acknowledges there are some differences in the data collection.

The table above is not a complete list of the discretionary strategies managed by the bank.

All terms mentioned above are indicative and correct at 16/01/09. These terms may not be repeatable but act as examples for illustrative purposes.

The price, or value of, or income from, your investments can fall as well as rise and you may not get back the original amount invested. Exchange rate changes may affect the value of investments. Past performance is not necessarily a guide to future performance.