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Wealth Manager: Credo head of research Stillerman brings quantum physics to portfolio construction

Wealth Manager: Credo head of research Stillerman brings quantum physics to portfolio construction

Credo Capital’s Gemma Stillerman has had a rapid ascent. Just two and a half years after joining the firm as a senior research executive, she is now head of research and chair of the group’s investment committee with the ultimate responsibility of setting the asset allocation for its £1.2 billion in funds under administration.

Although it could be argued that finance is in the blood – her father, Barry Stillerman, founded the wealth management arm of BDO Stoy Hayward – she took a slightly indirect route into the industry, studying physics and philosophy at Leeds University, majoring in quantum physics.

‘Quantum physics is all about practical mathematics and you can take that into investment,’ she says. ‘It gives you a different view on things and leads you to break everything down and question why it is happening.’

After graduating with a first-class honours degree, during which time she worked as an intern at Goldman Sachs, Stillerman joined the UBS graduate training scheme. She speaks highly of her time at Goldmans, recalling: ‘It was my first introduction to the industry. The training was very intensive and you were surrounded by very driven people. I realised that it was the type of environment I wanted to work in.’

In 2005, Stillerman joined GAM, working as an analyst on its emerging markets desk with responsibility for Latin American equities across all global emerging market long-only portfolios and hedge funds. Being accountable for $600 million at such a young age might have fazed a lot of people but Stillerman relished the challenge.


‘It was a very exciting time in the Brazilian market, in particular,’ she says. ‘There were at least two or three initial public offerings every week and it was a great grounding to be able to understand both how fund managers operate and how hedge funds work.’

Although she enjoyed the cut and thrust of emerging markets, Stillerman soon recognised that she wanted to broaden her knowledge base rather than work in one narrow sector. She cites the example of a friend at UBS back in 2008 telling her to look at what was going on in the credit markets, which were pointing to the unsustainable nature of the equity bull run.

The opportunity to take a more strategic role arose at Credo Capital, which she took, swiftly moving up the ranks. ‘I was conscious that just focusing on Latin America was very narrow,’ she says.

‘To understand any one market you need to be aware of what is going on in other markets. If you are insular and just focused on one sector or market, you can lose a bit of perspective.

‘To truly understand the macro environment you really need to know what is going on in credit, the housing and job markets, for example, in order to be able to build a holistic picture. So when I got the call from Credo, it was a very attractive opportunity.’


The South African-owned firm was launched in 1992 and expanded significantly over the following six years, broadening the number of services it offers alongside asset management and stockbroking to include property investment management, trust services, corporate finance, private equity and lending facilities.

Stillerman describes her role as ‘finding the best investment opportunities out there’ and although the group predominantly uses third-party long-only and hedge funds, it also implements some direct investments around the margins.

Overall, Stillerman says she is quite negative on the state of the global economy, but stresses that there are still opportunities to be found. Equally, there are plenty of pitfalls but, perhaps owing to her quantum physicist past, she is wary of reading too much into any one set of data, particularly in such a sentiment-driven market environment.

‘People focus on the unemployment figures in the US, but it hides the percentage of employers that have reduced their staffs’ working weeks or made some employees work part-time,’ she says. ‘Realistically, firms will increase their employees’ hours first before taking on new staff, so you really have to look beyond the headline figures.


‘One of the big risks is that people focus on one data point. Everything is calculated by humans, which means that there are errors and nuances to it, and you need to build a broader picture out of all of the information out there.’

She also warns of the risk of countries being spuriously linked together through the rash of acronyms, such as Bric (Brazil, Russia, India, China) and other groupings like ‘the next 11’.

‘There is a risk of acronym over-exuberance and the likes of Chindonesia mask the fact that there are huge discrepancies in terms of economies and investor sentiment,’ she adds.

‘But it is not about arguing against certain trends, it is about how to exploit them and a number of high-quality, profitable companies have been overlooked because they do not form part of the latest acronym.’

Her background as a fund manager has been invaluable in helping her spot these opportunities, Stillerman says, and says crucially, her experience of actually running money helps give her an understanding of how markets and not just the economy work.

Even unloved areas can still throw up attractive opportunities and Stillerman points to commercial property as a case in point.

She admits that some people might raise their eyebrows at the fact that Credo tends to run a high property allocation, overlooking the fact that it has an in-house property team.

‘Some are surprised when you have the foreclosure issue in the US and 2.5 million delinquencies with many more in distress, but we allocate internally,’ she says.

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