Xplan will also be the financial planning platform of choice for Rathbones’ upcoming integration with Investec Wealth & Investment, further enhancing the firm’s digital capabilities and enabling improved operational efficiency and client service.

Rathbones selected Iress to join its group of service and technology partners because of the modularity of Iress’ solution and its commitment to integrating and partnering with systems from other technology providers.

Iress’s managing director, UK Wealth, Alex Hore (pictured), said: “We are thrilled to be working with an organisation such as Rathbones, which is known for its pedigree and high standards.

“The market knows Xplan as an all-in-one solution, but many perhaps don’t know about our flexibility. This project highlights how we can slot seamlessly into a complex infrastructure alongside other best-of-breed providers and work collaboratively to ensure the client has the right technology to maximise efficiency and grow. We’re looking forward to a long and successful relationship in supporting Rathbones.”

Rathbones’ chief operating officer Andy Brodie said: “The delivery of Xplan alongside our other digital solutions is a key step forward in enhancing the experience of colleagues and clients across the Group. The flexibility shown by Iress to work with our other providers and deliver best-in-class financial planning solutions supports our overall ambition to enhance how we manage client relationships and deliver superior client service.”

In an environment of falling inflation but rising geopolitical risk, what should investors expect from global equities this year and where should it fit into their asset allocation plans?

In this head to head, Alison Savas (pictured right) of Antipodes looks at the factors that drove performance in 2023 and explains her cautiousness to begin 2024, while Rathbones’ David Coombs (pictured left)  explains why his equity portfolios will continue to be dominated by the US in coming months.

Alison Savas, investment director, Antipodes Partners

Global equities had a strong 2023 driven by the seven largest tech stocks for most of the year, until the back end saw an increase in breadth.

The 2023 laggards have begun to lead the market on the view that inflation has been vanquished, meaning rates will fall while economic growth and employment can remain intact. This is one possible outcome, though we see greater uncertainty ahead with risks around an inflation wall, tightening liquidity and the delayed ramifications of tight policy. We expect greater volatility around the economic cycle and lower equity multiples.

The pathway for inflation is down but the last mile may be harder to achieve than expected. We see core inflation getting stuck around 3% mid-year, owing to a sticky shelter component resulting from a large and continued undersupply in US housing.

We expect some rate cuts over 2024, but with the market already pricing in around 140 basis points in cuts, the risk is disappointment over the pace of loosening. If the Fed cuts too early it could reignite inflation. Investors need to be open to rates staying higher for longer.

We also expect liquidity to tighten from Q1 as the very large fiscal deficit in the US will increasingly need to be funded via issuing long-dated bonds. With the Fed out of the market (adding to supply via quantitative tightening), banks, insurance companies and households will need to soak up this issuance, which means less capital available for holding other assets.

A supportive liquidity environment in 2023 disproportionately benefitted a narrow set of winners, so a deterioration will have implications for equities. Investors should focus on finding tomorrow’s winners rather than wedding to yesterday’s success stories – and paying a fair price for the quality of a company and its growth profile, not any price.

Our base case remains a mild recession in the west. The US has been more resilient as the transmission of tighter monetary policy to the real economy has lengthened largely due to the prevalence of fixed rate mortgages, but the threat of tight monetary policy may not have passed.

The labour market continues to loosen and nominal wage growth is slowing. The US could still experience a downdraft in activity, for which US equities are not priced. At 21x, earnings valuations are expensive relative to history and other regions like Europe (11x) and China (9x), which have already experienced an earnings downgrade cycle.

‘Picks and shovels’ play

The Antipodes global portfolios remain relatively defensively positioned with exposure to attractively priced healthcare stocks (such as Merck and Sanofi) and consumer staples (Diageo, Tesco). We’ve been selectively adding to global cyclicals that have attractive supply/demand dynamics (TotalEnergies) or are exhibiting bottom-of-the-cycle characteristics and are priced on low multiples.

But despite the risks, opportunities exist. We’re finding beneficiaries of emerging investment cycles in energy transition and cloud/AI monetisation that remain mispriced. Companies such as Siemens, a global leader in factory automation, energy efficiency systems that manage power consumption and rail signalling equipment.

Siemens not only benefits from the move to a lower carbon world but also onshoring. Also, Taiwan Semiconductor Manufacturing Co, the ‘picks and shovels’ play of the AI age. TSMC manufactures chips for semiconductor companies globally, with a near monopoly at the leading edge.

We’re also finding opportunities in emerging economies like Brazil, Mexico and Indonesia. Fundamentals are improving, inflation is under control and there’s scope for policy rates to fall. Examples include one of the leading private sector banks in Brazil, Itau Unibanco, and the dominant convenience store operator in Mexico, Fomento Economic Mexicano.

If it becomes more apparent that the Fed can engineer a soft landing then we will lean into our cyclical exposures – mature cyclicals and beneficiaries of long duration investment trends – and ex-US listed multinationals are an attractively priced way to play a soft landing.

David Coombs, head of multi-asset investments, Rathbones

We broadly left our equity positioning unchanged over 2023, despite the macro noise, but did take the opportunity during the summer to trim our positions in the five members of the ‘Magnificent Seven’ we held.

We also added to our medical-technology names in Q3 as they sold off on concerns relating to falling demand for their products as weight reduction drugs cured obesity for all – according to the prevailing narrative at the time.

It is easy to overgeneralise, but I think it is safe to say our focus has been on quality and growth with a significant bias to the US, given our view that the US would avoid a recession in 2023. This is despite the negatively sloping yield curve, due to fiscal stimulus offsetting higher interest rates.

We continue to see long-term opportunities in med-tech and, more controversially, in industrials benefiting from the US spend on infrastructure. Both do come with challenging valuations and the promise of more volatility as sentiment swings from ‘soft to hard landings’ and back.

Legislation such as the Inflation Reduction Act and the Chips and Science Act are encouraging investment into manufacturing through incentives worth many billions of dollars. We also believe the trend towards onshoring, where companies look to move some of their manufacturing operations closer to home is benefiting a whole ecosystem across industrial America.

This should continue whoever is elected president at the next election as the US aims to shore up its supply chains and encourage further investment into strategically important sectors.

Working hypothesis

As we head into 2024 we think that with rates having risen so far and so fast, this will weigh on economic growth. But inflation is likely to continue to trend down, which is probably what prompted Fed chair Jerome Powell’s December ‘Pivot press conference’ with interest rate falls back on the agenda, resulting in a relief rally for interest rate sensitive sectors such as Reits and retailers.

We remain cautious in this regard, with a working hypothesis that rates will stay higher than the more optimistic commentators are predicting. This keeps us away from more highly leveraged areas or deep-value cyclicals. So our equity portfolios will continue to be dominated by the US this year.

Elsewhere we have concerns around UK growth, and while the impact of economic policy may not have a material effect on the FTSE 100, which is largely full of global businesses, we maintain limited exposure to companies with significant revenues from the UK economy in the portfolios. The Bank of England, at the time of writing, seems hell bent on creating unemployment and a recession to reduce inflation – mostly caused by external factors – while the government and opposition looks to squeeze businesses and the consumer through a high tax regime.

Europe could be interesting if there is a resurgence in the Chinese economy, which seems more likely than it has since Covid. We see value in many mid-cap industrial names, which have had a torrid few years. We also expect the European Central Bank may turn more dovish by Q2. Asian and emerging markets could benefit from a weaker dollar if US rates start to fall. However, within a multi-asset context – or from a risk/reward perspective – we still prefer to own businesses in the US and Europe with customers in the region, rather than owning local companies.

In 2024, we expect there will be greater dispersion in share price movements and a broadening out of performance leadership. This is due to the impact of multiple years of higher costof-capital starting to feed through into operating margins. Forget geography, access to cheap capital is the key to success – together with sector dominance and markets where the consumer still has money to spend.

This article was written for our sister title Portfolio Adviser’s January magazine.

The strategies, including the BNY Mellon Global Dynamic Bond, BNY Mellon Sustainable Global Dynamic Bond and BNY Mellon Global Dynamic Bond Income fund, were placed under suspension in June 2023. Ella Hoxha, formerly at Pictet, took over as fund manager in December of last year.

Square Mile stated that after meeting with Hoxha and discussing the changes to the portfolios, its team believes “it will take time to fully appreciate the impact of those changes”. In addition, Square Mile found the medium-term returns “not in line with expectations”, resulting in the funds’ removals.

Jupiter Value funds, including the AAA-rated Jupiter UK Special Situations fund and A-rated Jupiter Global Value Equity fund, were suspended after Ben Whitmore and Dermot Murphy announced their departure for July 2024 to create their own investment boutique. While JO Hambro Capital Management’s Alex Savvides will take on the UK equities portion of the funds, there is still discussion over the global equity assets and whether they will transfer with Whitmore, Square Mile said.

See also: RLAM and Artemis funds added to Square Mile academy

Despite the three funds dropped from BNY Mellon, the BNY Mellon Futurelegacy fund range gained a responsible Positive Prospect rating. The group of five funds are managed by Newton Investment Management and launched in February of last year.

“In what is an under-represented area of the market, Square Mile believes this range has all the attributes necessary to provide competitive long-term returns while following the team’s sustainable investment approach,” Square Mile stated.

The Brown Advisory Global Leaders fund was awarded an AA rating, managed by Mick Dillon and Bertie Thomson. The fund, launched in 2015, comprises 30 to 40 holdings which Square Mile claims is “differentiated from its peers and a very solid offering for long-term investors”.

Aikya Global Emerging Markets gained a Responsible A rating while Rathbone Greenbank Multi-Asset portfolios obtained a responsible recommended rating.

Three strategies, the CT UK Social Bond fund, Artemis SmartGARP Global Emerging Markets Equity fund, and WS Montanaro UK Income fund retained their ratings despite changes in management.

In total, Square Mile conducted 52 interviews with 31 asset management groups in the month of January.

This article was written for our sister title Portfolio Adviser

The bank has announced that chief executive Peter Flavel will step down with immediate effect, following his role in the handling of Nigel Farage’s case.

Mohammad Kamal Syed will step into the role as interim chief executive of Coutts and the wealth businesses, subject to approvals.

Strabens Hall

The wealth manager has promoted Alex Stephens to chief operating officer.

Stephens has been with Strabens Hall for 9 months and was previously head of operations.

Prior to that he worked at the Chartered Institute for Securities & Investment.

Natixis Investment Managers

The investment manager has promoted Patrick Sobotta to regional head of Germany, Austria and Central and Eastern Europe and executive managing director.

He will be responsible for the retail, wholesale and institutional activities within those regions. Sobotta will report to Fabrice Chemouny, executive vice president and head of international sales.

Elsewhere, Erik Crawford will join as senior sales director in August.

The firm has also promoted Constance Clerc as head of business enhancement based in Paris.

Clerc joined Natixis in 2016 and was previously head of strategy and sales management for international distribution.

The Exit Partnership

The wealth manager has hired Dave Robinson as head of internal exits.

He will spearhead guidance and advice to retiring IFAs considering a management buy out (MBO) or employee ownership trust (EOT).

BlackRock

The investment manager has appointed Mandy Lui as head of greater China wealth and Dennis Quah as head of Singapore wealth.

Lui will join in mid-August in Hong Kong and will focus on developing relationships with distributors in the greater China refioin.

She joins from Baring Asset Management where she was head of wealth and retail distribution for greater China and southeast Asia.

Quah has joined this month and will focus on building relationships with consumer banks, private banks and insurers.

He has previously worked at Columbia Threadneedle and Schroders.

Schroders

The asset manager has made several changes across its Asia Pacific team.

The current Apac head of client group, Szu Yi Chin will become head of wealth for Apac.

While, Katherine Cox who has been the firm’s Apac head of strategic clients, product and private banks, has now been appointed as its global head of long-term asset owners.

In another move, Lily Choh, the firm’s chief executive for Singapore, has had a broadening of her role to oversee Singapore, Malaysia, Thailand, Indonesia and India as head of south Asia.

Similarly, the firm’s Hong Kong chief executive and Apac head of strategy, Gopi Mirchandani, has been named head of north Asia. Her area of focus will now include Hong Kong, Taiwan, Korea and Japan. She will also retain her role as head of strategy for Apac.

Chris Durack, who is currently head of Apac, as well as Karine Szenberg, head of Europe and global head of product and marketing, have been appointed co-heads of Schroders’ client group.

Stonehage Fleming

The family office has made a series of promotions across the London office.

In the family office division Jack Henderson and Anna Wetherell have been promoted to associate director while Francesca Maule and Eleanor Sowerbutts to manager and Edward Durgan to senior associate.

Within investment management, James Cook has been promoted to director, Mark Leshnick, Archie Burt and Miki Caves to associate director, and Ross Elliott to manager.

Robyn Bramwell has been promoted to director in corporate, legal and tax advisory.

In group services, Peter Rogerson has been promoted to director, Hannah Berry to associate director, with Claire Main and Oliver Taylor promoted to senior associate.

JM Finn

The wealth manager has promoted Todd Babington to head of operations following the retirement of Frank Reardon.

Babington has been with the firm for five years , he has previously worked at Arbuthnot Latham and HSBC Private Bank.

JTC

The wealth manager has appointed Helena Storjohann as director in its Geneva office, where she will be responsible for a portfolio of clients and trusts

Prior to JTC, Storjohann was at Julius Baer, where she was a wealth planner.

DFSA

The Dubai Financial Services Authority announced that Swee Lian Tee will be stepping down from its board of directors on 31 August.

Teo has served on the board for six years as the chair of the board’s risk committee and as a member of the governance and nominations committee and Emirati working group.

Fiera Capital

The asset manager has appointed Mandy Adamou as managing director, head of consultant relations in Europe, the Middle East, Africa and Asia.

Adamou will chair the firms Global Consultant Committee and will report to Klaus Schuster.

Prior to this role, she was managing director, global head of consultant relations at a global asset manager in London.

Close Brothers

The asset manager has hired Nic Heath as senior investment director.

He will provide bespoke investment management services for private clients, trusts, charities and pension schemes.

Heath has previously worked at Barclays Wealth and Investec W&I.

Rathbones

The investment manager has appointed Lynsey Carson as business development director.

She will be responsible for enhancing Rathbones’ partnership with adviser businesses across Scotland and Northern Ireland.

Carson joins from LGT Wealth Management where she was business development director and has also held senior positions at Coutts, RBS and NatWest.

Aviva Investors

The global asset manager has appointed Viktor Dietrich as research director and Rebecca Crocker as research analyst.

Both will report to David Hedalen, head of real assets research as part of a seven person team.

Dietrich was previously at Patrizia where we worked as an equity analyst while Crocker joins from American Express as a senior financially analyst.

The enlarged wealth manager will operate under the Rathbones brand. The deal does not include the Switzerland-based Investec Bank or Investec Wealth & Investment International.

In a statement to the stock exchange, the boards of both companies said the deal will bring scale and technology benefits, with the new entity targeting £60m in pre-tax cost savings per year.

Under the terms of the agreement, Rathbones will issue shares in exchange for 100% of Investec W&I’s UK share capital. Upon completion, Investec Group will own 41.25% of the enlarged Rathbones Group, with 29.9% voting rights.

Clive Bannister, chair of Rathbones, said: “This transaction not only presents a compelling strategic and financial rationale, but also accelerates Rathbones’ growth strategy. Operating at scale allows the group to offer an even more attractive proposition to clients and colleagues, supporting future growth and creating significant value for Rathbones’ shareholders.

“I look forward to Investec W&I UK colleagues joining the enlarged Rathbones Group, and welcome Investec Group as a strategic shareholder. I am hugely excited about what the combination can deliver.”

Fani Titi, Investec group chief executive, said: “The combination of Investec W&I UK and Rathbones brings together two businesses which have a long-standing heritage in UK wealth management and closely aligned cultures. The strategic fit of the two businesses is compelling with complementary strengths and capabilities to enhance the overall proposition for clients.

“This will be supported by the strategic partnership which offers attractive growth and collaboration opportunities for both groups. The transaction represents a real step-change and long-term opportunity for our UK wealth strategy, underscores our commitment to the UK wealth management market and enhances our UK business as a whole.”

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