‘The overriding objective of most of my clients is to maintain and enhance the capital value of their portfolios above inflation over the long-term,’ explains Tom Vernon, an investment manager looking after a wide variety of private, charity and institutional clients, ranging in size from £500k to £250m.
‘In addition, many clients require a reasonable level of income that also grows in real terms. A large proportion of my clients have a ‘medium’ risk profile with 40 to 70 per cent exposure to global equities, but there are also a number with 100 per cent equity mandates.’
Sarasin provide discretionary investment management services for private clients, charities and institutions from the UK and around the world. ‘We have particularly strong strategic investment skills, helping clients design and refresh investment strategies that are robust under a range of scenarios,’ says Vernon, who has been at the firm for 12 years now.
‘We are well known for our global thematic equity selection, our dynamic asset allocation and for long-term income and dividend management across multi-asset and equity mandates.’
Other areas of expertise include the management of target return portfolios, their AIM IHT portfolio service and managing portfolios for US related individuals and structures through their SEC registered subsidiary, Sarasin Asset Management.
Vernon notes an increased interest from private clients in responsible stewardship and what their investment manager is doing on their behalf in this area. ‘From our charity heritage, environmental, social and governance research has always been an integral part of our investment process,’ he says.
Environmental, social and governance investments have always played a part in the firm’s charitable heritage. ‘This is not just a moral issue for us but an important risk management tool when constructing client portfolios,’ explains Vernon. The firm also undertakes policy work in cases where ‘we can influence practices at a sector or government level, for example on accounting standards’.
The previous 12 months have been strong. Portfolio growth has been ‘good’. Its intensive management of portfolios has proven beneficial to the firm’s clients, who are provided with a service remarked for its clarity and reportage. New clients continue to arrive too, thanks to the firm’s continuous development of new investment strategies.
Vernon is acutely aware of the challenges facing the industry. ‘I think the main challenge for investment managers will be how best to generate returns after such a strong period for most asset classes,’ he says. ‘It will be difficult to match the real returns that clients have experienced over the last 5 years in the next period, particularly for UK investors if inflation remains at current levels. Lower returns will undoubtedly put even greater scrutiny and pressure on the costs of investment management’