Interesting branding but, to be fair, it was the first firm in Egypt to be granted the portfolio management licence. What is more, in its “quest to reach the optimum investment scheme for each client, its prudent committed professional team applies all necessary investment tools spanning over the wide and diversified spectrum of investment analysis tools including modern financial, fundamental, technical, psychological, quantitative and qualitative tools”.
So now you know and, should you ever find yourself needing the services of an asset manager in Giza or Alexandria, you can thank me later. But, of course, I didn’t really need Ms Google to tell me this – deep down I knew the metaphorical equivalent of Inertia Asset Management was alive and well and predominantly residing in our nation’s capital cities.
Handily enough for me, this has been highlighted in recent weeks by the publication not only of the latest twice-yearly source of comfort and joy to investment groups, Bestinvest’s Spot the Dog guide, but also Chelsea Financial Services’ equally gleeful finger-pointer, The Relegation Zone.
Each firm employs different criteria in its efforts to name and shame what they see as the serial underperformers. For Chelsea, it is three consecutive discrete years of third or fourth-quartile performance while, to qualify as a Bestinvest dog, a fund must have both underperformed its benchmark in each of the last three years and underperformed its benchmark by at least 10 per cent over the past three years cumulatively.
In Bestinvest’s case, that comes up with £7.27bn of flea-bitten funds while Chelsea’s methodology means it regards investments totalling £11.16bn as the investment equivalent of West Brom, Charlton, Cheltenham and Luton. Even if we allow for the obvious overlap by going with the lower of the two figures, that still leaves Inertia Asset Management as a bigger player in the retail UK market than Artemis.
That is really quite scary – as is the fact that one of the funds highlighted by Chelsea is the £2.19bn Scottish Widows corporate bond portfolio. I have no idea how many individual investors are in that fund but you would have to think that, if they and their advisers stopped to think, one or two of them might not be terribly satisfied with those three consecutive discrete years of third or fourth-quartile performance.
Scottish Widows corporate bond is just one of the Lee Marvins in Chelsea’s so-called Dirty Dozen which highlights the six worst performers and six biggest funds in The Relegation Zone and – just so you don’t think I am picking on Widows – sees some canine overlap in the case of Rathbone special situations, LeggMason US equity, Cavendish opportunities and, ah, Swip emerging markets.
Now, I rather like this new “worst of the worst” approach from Chelsea and hope we can eventually look forward to Bestinvest bringing out a “dog of dogs” version, perhaps for the 10 years to 2010. Perhaps they could be called the Digbys after the biggest dog in the world – or was I the only person who saw that film?
Back in the present, Adrian Lowcock, senior investment adviser at Bestinvest, notes: “A late resurgence of markets in December has ensured that the number of dog funds since our last issue in August 2008 has fallen from 92 to 82. That said, there is still a substantial amount of money sitting in funds that are performing badly and investors should regularly review their portfolios to ensure they are getting the best possible returns.”
To my mind, that last sentence is really missing the words “and their advisers” after “investors” although I accept that would rather militate against one of the main reasons for Bestinvest publishing the Spot the Dog guide. Nevertheless it would be nice to think that, in the naturally unlikely event any client’s funds appear in Spot the Dog or The Relegation Zone, their adviser has a really, really good reason for remaining invested.
Julian Marr is editorial director of marketing-hub.co.uk