Today’s Pub Club takes us out of the hustle and bustle of central London to the leafy residential borough of Richmond-upon-Thames, writes Eleanor Mahmoud.
Local firm Quartet Capital Partners informed me that today’s venue is The Britannia, the oldest pub in the borough. Tucked away from the main road and down a small picturesque alleyway, it has bags of charm. In fact, the pub front is so understated that I walk straight past it before having to retrace my steps.
Fortunately I find Tom Davies and Oliver Robson, Quartet’s senior investment managers, already waiting at the back of the pub for me. With beers for the boys and white wine for myself, I ask them to fill me in on what the team has been up to.
Founded in 2009, Quartet Capital Partners celebrates its 10th birthday next year. The close-knit team of 16, of which seven make up the private client portfolio management team, now has over 300 clients. The firm is also in the midst of a digital overhaul, which will see a re-brand and new website.
‘Our AUM is now well over £300 million,’ Robson begins. ‘The continually growing AUM is improving our credibility with intermediaries and clients and is opening doors to new opportunities.’
‘As a boutique, we are all able to perform a multitude of functions,’ Davies said. ‘We all sit on the investment committee, we all look after clients, and we all do a bit of marketing.’
He goes on to detail Quartet’s joint venture with Absolute Return Partners (ARP) – the institutional investment advisory business with whom they share their office building. Economist Niels Clemen Jensen, co-founder of both firms, proves to be invaluable to them.
‘It is great to have Niels as a resource. It is quite rare to have institutional level investment management within a smaller firm. That way we combine a personal client service with a sophisticated investment process.’
‘The joint research function with ARP makes investment committee meetings really interesting,’ they both said.
We are certainly a hungry bunch and it does not take long to agree that it is a two course kind of lunch day. Davies and I coincidentally order matching lunches – both choosing crab for starter and risotto for main, while Robson opts for the pork belly starter, followed by lamb.
Robson, who joined Quartet last year, says he is enjoying being part of a smaller investment management firm: ‘In a firm of our size, you are able to be closely connected to both the investment side and also to the client.’
‘We have never bought a position without the whole team having met the fund manager,’ he added. ‘Clients have a higher level of trust in the team as all of us can say we have met the managers and have directly contributed to the investment rationale to hold that particular position.’
Within client portfolios equity allocation is, generally speaking, lower than that of their peers, I am told.
‘As a younger firm with no stockbroking legacy, we have no equity bias. I think this makes us much more agile,’ Robson noted.
Davies goes on to explain how as we see increasing correlation between equities and bonds, they are hunting for diversification through alternative investments. This is certainly not uncommon, so I am keen to ascertain where their search has led them:
‘Water and agriculture are long term themes that are relatively immune from short-term market cyclicality,’ Davies said. ‘There are other esoteric opportunities within investment trusts that can provide decent levels of income, particularly if share prices trade at a discount to NAV.’
Glass half full:
‘A healthy correction in markets always creates opportunity.’
Glass half empty:
‘The increasing consumer debt burden – as quantitative easing unwinds, at what point do rising interest rates become a real issue?’