Five smart brains discuss exciting topics in Lugano
• Caduff: Ladies and Gentlemen, what is the importance of the Lugano financial centre for your company?
Ipsaryaris: After Zurich for the German-speaking area in Switzerland and Geneva for Romandie, Lugano is the third financial center for the Italian-speaking part of Switzerland. Many large wealth managers have a subsidiary in Lugano, alongside local private banks, and independent asset managers. For us, it is without question a part of Switzerland that we naturally look after. The financial center has been shaken up in recent years and we can see that it is reinventing itself.
Apel: Switzerland has become more and more important for DNB Asset Management over the last six years, we have been able to attractively expand our customer base and Lugano is clearly one of them. We have important customers in Lugano and are currently expanding our customer relationships here. The Fundplat events also contributed to making new and important contacts here in the Ticino area. But even without events, Lugano was and is in my travel calendar anyway and has an important place there, because the existing customers also want to maintain regular personal contact on site. Overall it is a very nice place with lovely people and in my opinion good business opportunities.
Burri: As a family-owned business serving like-minded families for over 40 years, Tramondo is naturally drawn to Lugano with its private banking tradition. We share another commonality: Since we're based in Zug, we enjoy observing the hectic and occasional irrational herd behavior of the big financial centres and their markets from a healthy distance.
Dalla Corte: As an Italian asset manager, we feel very close to the Italian-speaking region of Switzerland. Not only because of the common language but also because many Italians maintain a banking relationship in Ticino. The recognition as Italy's largest asset management company is, therefore, more evident than in other parts of Switzerland. Moreover, the vicinity of Lugano to Milan, where Eurizon has its headquarter, allows us to frequently be here with our portfolio managers to share insights of our portfolio with our clients.
Varnholt: To be quite honest, as a company, we don’t have much exposure to the Lugano’s financial community. This is regrettable because Lugano has a long tradition as a very dynamic financial center. From a Zurich perspective, Lugano seems like a friendly and welcoming but also tightly knit community. This observation is probably true both ways. Few Lugano investment firms seem to be keen to venture across the Gotthard divide in order to do more business in Zurich for example. I am grateful to Fundplat for bringing the investment centers closer together. There is always something to be gained by crossing perceived borders.
• Caduff: Which investment solutions do you particularly want to score with in the current year?
Burri: We're in for choppy and erratic markets in the coming months. This tug of war between permanent and transitory inflation prospects leads market participants to flip between risk-on and risk-off positioning continuously. Still, there is simply no way around equities in any professionally managed portfolio, given the current yield environment. The perennial challenge is constructing a portfolio of securities that provides capital preservation without sacrificing profit potential and without locking investors into 15-year private equity type commitments. Our approach combines liquid quality investments that simultaneously act as an inflation hedge with dynamic exposure management and hedging. We cast our net globally but intend to launch an European-focused carve-out shortly.
Varnholt: Post-corona, investor’s main concerns are macro-economic in nature. The best investment solutions will have to reflect this reality. We have just launched a «music rights» fund which generates reliable investment returns away from traditional financial markets. I am also convinced that intelligently managed fixed income funds with a clearly defined investment process and purpose will have a very good year ahead of them. Last but not least, there are some pockets of value left in specific equity market sectors such as biotechnology, climate tech and blue-chip Asian technology stocks.
Apel: The demand for real ESG strategies is increasing, I can feel that very clearly. My customers specifically ask about SFDR Articles 8 & 9 Funds which they also get from DNB. When it comes to clean tech / renewable energy, Nordic equities or global technology, we can offer our customers optimal funds here. However, we have also heard our customers' request for currency-hedged bond funds in Swiss Francs and have taken this into account. The Nordic high-yield market is now also open to Swiss investors without taking on currency risks. In December 2019, we also launched a new fund that deals with the megatrends of this time, but also takes ideas from the other successful DNB theme funds into account. Disruptive opportunities is the keyword here.
Dalla Corte: During the last few years, especially two of our funds have been crystallized as blockbusters. Both are rather new asset classes and are finding more and more their way into client portfolios. Eurizon’s Chinese Onshore Bond fund has proven to be an optimal solution for investors aiming to achieve positive returns in a challenging interest rate environment. While our Green Bond fund with its unique absolute return strategy has generated great environmental and financial results. With the ongoing evolution of those two asset classes, we are convinced that they will continue to offer remarkable results for our clients.
Ipsaryaris: We focus on the following three sustainability outcomes; «Climate», «People» and «Earth» with defined UN SDGs we want to address with our investment solutions. In the area of «Climate», the topic we currently consider to be the most urgent, we already have, both Global and European equity strategies as well as a Global Climate Transition Credit solution. We see climate change as the biggest systemic challenge for society, the global economy and businesses, not to act is likely to have catastrophic and far-reaching consequences - which will affect capital markets and asset valuations as well. Our core funds will align to net zero emissions and we are working to expand our Sustainable Outcomes range across the «People», «Earth», and «Climate» themes.
• Caduff: Can you also put unique selling points (USP’s) on the scale with this?
Dalla Corte: By launching our Chinese Onshore Bond fund our goal was to deliver the attractive market return in a safe and efficient manner. Our joint venture with the Chinese AM Penghua Fund and our experienced PM team in London, we’ve been able to access the onshore market and to construct a portfolio that mirrors our philosophy, while delivering outstanding results. Moreover, given the increasing ESG requirements of European investors, we have been able to substantially improve the overall ESG rating of our portfolio. While per definition the environmental and social aspects are the anchorage of Green Bonds, we have created a screening process to properly evaluate the «greenness» of the projects we are financing. Additionally, we opted to propose an absolute return strategy to mitigate the challenges in global bond markets.
Ipsaryaris: For almost five decades, we have used our voice to drive positive change. Our engagement as responsible investors dates back to 1970 and that's when our ESG journey begun. We are a pioneer in terms of sustainability - for 50 years we «turn talk into action». We are always at the forefront such as being a Founding Signatory of the PRI (Principles for Responsible Investment in 2006) and ClimateWise in 2007, and the Corporate Human Rights Benchmark launched at Aviva’s offices in 2017. Aviva, our parent company, has been also the first major insurer in the world to target Net Zero carbon by 2040. We are also committed to investing 2.5 billion US-Dollars in low-carbon and renewable energy infrastructure and to run all our offices with 100 percent renewable electricity.
Apel: As a Norwegian and therefore Scandinavian asset manager, we do not have an outsider role, but we are also not the major global provider of investment funds. We see ourselves as a boutique in international business and look after our customers very closely. A unique selling point is certainly our Scandinavian expertise, we can offer our customers access to the Scandinavian markets. Our customers will find attractive portfolio components there and can diversify their portfolio with Nordic stocks or bonds. But our customers also benefit from our expertise when it comes to sustainable investing. Scandinavia is without question a global leader and is a pioneer in this area. This also benefits our customers.
Burri: Tramondo has safely navigated through some of the most challenging markets last year on behalf of its investors. We credit this to being disciplined and adaptive, but foremost to being prudent. Our primary investment credo is a battle-tested sailing metaphor: we cannot direct the wind, but we can adjust the sails. There are no happy ends for those who venture fully exposed into inclement markets with the naive hope that, eventually, things will turn out fine. Our acid test is being able to sleep well with every position we hold. Yet, there is no «good story» without a «good chart», i.e. fundamentals are only as good as the underlying technical price action. This requires a serious commitment to the markets. Our day ends at 22:00 hours Swiss time when US markets close.
Varnholt: I think PMG has an impressive track record when structuring, launching, and helping to grow fund solutions. We are working not just for large and established initiators. We also help small and mid-sized institutional clients who are facing mounting regulatory challenges. Emerging managers have to compete on a technical level with a broad range of established competitors in a saturated fund universe. «One-size-fits-all» clearly does not apply to this group where it is key to stand out with regards to investment performance. Emerging managers also grow their fund in different ways than established brand names. We do know what it means to start from scratch, and we have a good understanding of how the transition from small to mid to large investment fund works.
Hagen-Holger Apel joined DNB Asset Management S.A. in July 2015 as Senior Client Portfolio Manager. In this function, he is a link between the Norwegian-based fund management and international clients, thus ensuring a high level of quality in client service. Apel holds a degree in economics (LMU Munich) and is a Certified International Investment Analyst (CIIA) of DVFA Frankfurt. He has 20 years of industry experience as a banker, trader and portfolio manager and has been active in the Luxembourg financial centre for thirteen years. He speaks German, English and Swedish. In international business, he is responsible in a leading position for Switzerland, Germany and Austria.
Leslie Burri joined Tramondo Investment Partners AG in September 2020 as Senior Investment Solutions Manager. In this role, she is responsible for developing institutional client relationships and acting as a link between investment management and clients to ensure a high-quality service. Before joining Tramondo, she spent seven years at FoHF-manager Ayaltis AG, most recently as Head of Business Development & Investor Relations. Prior, she worked in the fund solutions department of Bank Julius Baer & Co. Ltd. and held various positions at UBS WM and IB. Leslie Burri is a CAIA charterholder and holds a Master of Science in Banking & Finance from the University of Applied Sciences, Zurich.
Manuel Dalla Corte joined Eurizon in June 2018 as Country Head for Switzerland. Responsible for the business development he works closely with banks, asset managers and institutional clients. Prior to this his over 20 years experience was gained at Aviva Investors, Jefferies AM, Lombard Odier and UBS.
Rula Ipsaryaris is based in Zurich and focuses on growth opportunities for institutional clients and wholesale customers in her region. She has over 30 years in the financial service sector. Prior to joining Aviva Investors, she worked as Senior Sales Executive and Deputy Head Switzerland & Liechtenstein for Vanguard. She gained her professional experience in various leading positions in the fiduciary industry with an American broker, both international and Swiss Private Banks, as well as with one of the worldwide largest asset custodians. Rula Ipsaryaris holds a CAS (Certificate of Advanced Studies) in Sales and Distribution Management from Lucerne University as well as Fiduciary with Swiss Federal Accreditation.
Volker Varnholt is responsible for Client Advisory at PMG funds. After completing his studies at the University of Lausanne (HEC) and the University of St. Gallen (HSG), he began his career in investment banking as a fixed income trader at Salomon Brothers in London and Deutsche Bank in Frankfurt. Volker Varnholt has lived and worked in Zurich since summer 2000. At Julius Baer he worked for more than 8 years as Head of Research, Head of Portfolio Management Fixed Income and Wealth Management Advisory. In 2008, he moved to Clariden Leu Asset Management, where he managed the distribution of Clariden Leu funds into Private Banking.
Thomas J. Caduff is the CEO of Fundplat LLC. He has worked in the financial industry for about 40 years. His professional experience includes roles at the stock exchange commissariat of the Canton of Zurich, Bank Vontobel, Credit Suisse and UBS. Thomas J. Caduff also served for three decades in one division and multiple brigades of the Swiss Army, as a communication/media officer.