Please choose from the list of FAQs on your right to learn more about what we can do for you and your investment portfolio →
Why use a boutique?
Academic studies typically show that employee-owned, smaller businesses perform better than other companies. This is because:
Why use an investment management boutique?
Investment managers need intellectual more than financial capital:
The above being true, such businesses should be employee-owned.
Why use Gore Browne Investment Management?
As well as having the advantages conferred by being an employee-owned investment management boutique, we can also offer you something extra:
As a new client of Gore Browne, what should I expect?
We know from experience that no two clients will ever be quite the same, and this recognition of the need for individual attention is at the heart of how we operate. Everyone’s investment objectives are different and change over time, so to start with, we assume nothing. We take the time to discuss with you your objectives and individual needs. Then we assign you a portfolio manager who will be responsible for the day-to-day management of your portfolio, and to whom you will have direct access at all reasonable times.
Normally, two managers are assigned to each account, so that there will always be at least one other member of staff familiar with the account and able to answer questions. We also explain the risk element in any investment, and the reporting and control structures we have in place – an essential part of our approach to establish a high level of trust with all our clients.
After assessing your overall requirements, we make careful and selective investments to meet your needs for growth and income, and attitudes to risk. We look for the best investments to satisfy these, using our long collective experience and extensive knowledge of people and markets. We aim to make returns that will achieve your personal investment objectives within the timescale and risk tolerance agreed. On the way, we plan for the long term, and seek to keep returns positive rather than relative.
We encourage regular meetings to discuss how we are managing your portfolio, and any changes in your investment objectives. We aim to have a formal meeting at least once a year, but we are always available at short notice to attend to any immediate concerns or change of plans.
What will my portfolio contain?
We believe that investment portfolios should be diversified not only across different stock markets but also into commercial property, hedge funds and private equity. Investments will normally be effected through collectives such as investment and unit trusts.
Once funds have been committed to the relevant asset classes, the portfolio will generally remain largely invested. The most important aspect of investment in equities is the dividend, and the ability of a company to increase this at a higher rate than inflation. The expected return on an equities portfolio over the long term can therefore be seen as the dividend yield plus the expected growth rate of dividends. The latter can be represented by the growth rate in nominal GDP (the sum of real growth plus expected inflation).
Cash may be an alternative to fixed income.
How might my portfolio perform?
The following example shows the expected long-term return on a portfolio invested in UK equities, using data as at 15 May 2008:
Bank of England inflation target – 2.0%
Trend real growth of UK economy – 2.5%
Nominal GDP growth – 4.5%
Dividend yield on FTSE All Share Index – 3.5%
Reasonable expectation of return on UK equity portfolio over medium-term – 8.0%
Warning: Short-term fluctuations in the value of investments and the income from them means that this return may not always be achieved and that loss of capital may occur. Also returns on investment in overseas markets may follow different patterns.
How does GBIM manage risk/return levels in portfolios?
Our wide-ranging approach to asset selection enables lower, medium and higher risk portfolios to be constructed by varying the mix.
We select alternative assets (for instance, hedge funds, private equity, commodities and property) with the assistance of the specialist members of our investment advisory board.
How does GBIM select equities?
Our larger clients may have some direct UK equity holdings. We do not have a strong, distinctive style approach, but are flexible in looking for:
We also use funds to diversify the styles of equity selection within the portfolio.
How does GBIM select funds?
Funds offer the most efficient way for our clients to change asset allocation.
We invest in unit trusts, investment trusts, OEICs (Open-Ended Investment Companies) and offshore funds, which together encompass thousands of funds.
When selecting them, we focus upon people rather than products, and how they manage their funds, rather than only looking at the results they get.
We use external research to identify a small pool of about 100 promising managers, then reduce this to a recommended list of 50 – 60 managers through qualitative analysis based upon personal knowledge, interviews, references and style assessment. The result is exposure to an eclectic mix of managers who should outperform their peers over an investment cycle.
Why not invest in individual equities?
Household names, such as M&S, Shell, GEC/Marconi and Sainsbury, long beloved by private investors, have sometimes proved to be very disappointing investments, and large company shares have become as volatile as those of small companies. We all hate to see big losses in our portfolios, and buying individual shares increases the chances of having the occasional disaster.
Risk warning: You should remember that the value of investments and the income derived therefrom may fall as well as rise and you may not get back the amount that you invest. Past performance is not a guide to the future.
How can funds help to minimise CGT?
Private individuals have to pay capital gains tax, and thus are sometimes loath to take profits. This may not be right for their investment portfolios. Having more of one’s money in pooled funds allows the deferral of crystallising capital gains, because the funds are unlikely to be traded as frequently as shares.
Risk warning: Each individual client may have differing tax positions and requirements. The tax reliefs and allowances available to clients may vary from time to time.
How can I receive regular income from funds?
Some clients are concerned that funds may not pay dividends when they need the income. We can operate a system of paying income to our clients by monthly standing order so that they receive a consistent level of income throughout the year, regardless of the timing of dividend payments.
Risk Warning: You should be aware, if you select a higher level of income than that generated by the funds, that this may dilute the capital value of the funds.
What benchmarks do GBIM use?
We aim to achieve clients’ investment objectives within the timescale and benchmarks defined by the risk tolerance agreed. Verifiable benchmarks help to measure progress.
Many portfolios will be compared to the Growth, Balanced and Income benchmarks defined by the WMA (Wealth Management Association). Other portfolios will have a composite benchmark agreed at inception. For example, a portfolio with a lower level of risk may have a composite benchmark based on 25% in each of: starting 12 months LIBID; FTSE 0-5 years gilts index; IPD General Index; HFR Conservative Index.
When clients wish us to have market-linked performance benchmarks, these are generally monitored on a three year rolling basis, and not based on shorter term criteria.
We have the flexibility to use actual weightings that vary from the benchmark weightings and at times these variances may be significant.
Why is it often hard to work out what I’ll be charged for investment management services?
The way the investment industry raises charges can be complex, with initial charges, annual management charges, administration charges, transaction commissions, redemption charges, contract charges, bank charges, rebates and discounts, and then ad valorem fees, flat fees, performance fees, tiered fees, clean fees and so on. This makes it difficult for a potential investor to determine costs.
At GBIM, we cut straight through all the small print, by charging annual fees which cover everything and which are transparent and simple.