Transcript of "Investment week matrix article - 21 march 2011"
46 1 Investment Week 1 21 March 2011CHIEF EXECUTIVE INTERVIEWIn ashort space of time as CEO of Matrix Asset Management, Angus Wool house tells EmmaDunkley how expanding the groups distribution capabilities has been essential to navigatingMatrix in the right directionWOOLHOUSE BRINGS FRESHDIRECTION TO MATRIX ROLEAfter only a couple of months at the helm of in Hong Kong, where he was responsibleMatrix Asset Management, chief executive for developing mutual fund sales across theAngus Woolhouse is already steering the Asia Pacific region. "It was a pioneering role,firm in a clear direction. One of his first pri- bringing HSBC Asset Managements manufac-orities in the newly created role he took on last turing ability to bank distribution for the firstDecember was to expand Matrixs distribu- time, when Hong Kong and the whole of Asiation capabilities, by offering a broader range of Pacific was growing really fast."products to a wider network of investors. After gaining experience in the institu- "One of the first things I wanted to do tional and retail spheres, Woolhouse main-when I arrived was to reinforce to everyone tains he was lured to the CEO role at Matrix,asset management was one division - there rather than pushed into the position bywere areas of crossover between the prod- Gartmores ailing business. "The opportunityucts we make and our distribution networks. to effectively run your own business and beWe needed to reorganise ourselves as one responsible for 95 people and a £3.25bn assetdivision, rather than as a series of individual management firm was too exciting to turngroups," he said. down. What happened at Gartmore is just With over 25% of the local authority mar- what happened- I had gone by then."ketplace as clients and an established rela-tionship with the major intermediary groups Growth rootsin the UK, Woolhouse aims to leverage upon As an asset management firm with rootsthe firms existing investor base to grow the in pioneering tax-structured products forbusiness. "What I would like to do is move intermediary distribution, Matrix appealedto a broader, full service offering, so thesegroups and distribution channels are aware ofMatrixs full potential. This is an opportunity "One of the first things I wanted to do whenwe can now really leverage." Woolhouse is not just limiting his vision to I arrived was to reinforce to everyone assetthe UK. As part of his ambitious expansionplans, the CEO is keen to push the firms dis- management was one division ... We neededtribution capabilities to Europe and Asia,while seeking to hire a raft of new managers as to reorganise ourselves as one division,part of the process. "I am very keen to recruitand attract good fund managers, particularly rather than as a series of individual groups"in the absolute return hedge fund and UCITSspace. We are looking for managers that cover to Woolhouse thanks to its retail-basedUK long and short absolute return, pan-Euro- offerings and the opportunity to grow thepean absolute return, and macro." business. Established in 1987, Matrix was a currently manufacture, then there is a very pioneer in the venture capital trust space, compelling argument that says you can con-Finn objectives which no-one else was offering at the time, tinue to satisfy your clients needs, but youHaving set out his plan after only 12 weeks in he said. do it via somebody elses products."charge, Woolhouse has certainly cemented "It then evolved very quickly from being ahis position back in the retail arena. Prior to dominant player within that narrow product Capital preservationjoining Matrix, he was running the global space, as the group understood it could lev- In 2006, Matrix shifted from its core VCTinstitutional business at Gartmore, providing erage its expertise across broader-based offering towards absolute return hedgelong-only funds and hedge funds to some product lines. It then looked at investment funds and UCITS III funds. "We realisedof the largest pension schemes around the banking, property and a range of different retail wanted absolute returns and the prin-world. "I was at Gartmore for seven years until investing options, although its core business ciples of capital preservation, but in a regu-December 2010, which was fantastic, despite has always been intermediary distribution." lated UCITS III format. That is really whatwhat sadly transpired at Gartmore." Matrix has a dual strategy in terms of dis- the group has focused on in the last 18 His tenure at Invesco Perpetual before tributing internally manufactured products months to two years." Of Matrixs £3.2bnGartmore gave Woolhouse experience in and those from third parties. "The benefits assets under management, hedge funds nowbuilding newly merged brands. "I joined of both manufacturing and distributing your account for around £657m. Matrixs assetsInvesco in 1999 and was involved in the Per- product have always been understood. But are also up over 25% year on year.petual acquisition - running products and Matrix has been clever and led the market "VCTs are designed to reward investorsmarketing them across Invesco in the UK, in understanding if you cannot make a who are prepared to put money into compa-dealing with all the integration challenges, product, distribute those made by others. nies in need of capital. Banks lending hasestablishing the brand and really leveraging If expertise lies outside then distribute it been constrained over the last two to threesome of the positive attributes of the busi- to the intermediary community, where our years, therefore private investors have beennesses at the time of a massive acquisition." relationships are strong. No-one else has During his stint at Invesco Perpetual, Wool- really done that."house worked with Mike Webb, now CEO of This model has enabled Matrix to estab- BIOGRAPHYRathbones, in amalgamating two disparate lish some strong long-term partnerships e Joined Matrix in December 201 0 as CEO of Matrixs Asset Managementproduct ranges into one set, while retaining division. Prior to joining Matrix, was head of global institutional business at with groups that were not otherwise ablethe key fund managers. "This was my first Gartmore. to access a mass market retail audience. • Was previously group marketing and product development director at lnvescoexposure to UK retail, the broader interme- "We provide product structures that enable UK, where he was responsible for marketing and product strategy across alldiary market and the needs of IFAs." retail investors to invest into some of these distribution channels. Woolhouse first learnt his trade in new firms. If you have got strong distribution • Held a number of senior marketing positions at HSBC Asset Management,product development at Pepsi from 1990 to relations, a commitment to the IFA market- based in Hong Kong.1993, followed by a period with HSBC based place and demand for products you cannot
lnvestmentWeek 21 March 2011 47 CHIEF EXECUTIVE INTERVIEW MATRIX ASSET MANAGEMENT e Funds of funds • Cash funds • Hedge funds e Investment management e UCITS funds e Private equity and VCTs e Structured products e Specialised finance FUND RANGE e Matrix Asia fund, focused on Asian markets. e Matrix Macro fund, a global macro equity fund. e Matrix New Europe fund, focused principally on the markets of Russia, Poland, Czech Republic, Austria, Greece and Turkey. • Matrix PVE Global Credit fund, focused on global credit markets. • Matrix Redux EM fund, a macro fund focused on emerging markets. KEY FEATURES: e All funds are domiciled outside the UK and listed on the Irish Stock Exchange. e Appropriate for a SIPP, expert or institutional investment. e $100,000 minimum investment. e Fund manager is authorised and regulated by the FSA. MATRIX ASIA UCITS FUND e Asian equity long/short fund - typically holds 40-60 stock positions. e Focus on Japan and China as the two main markets, but also includes Korea, Singapore, India and Taiwan. e High conviction fund with a thematic and macro overlay. e Focus on adding value through the short book. e Rupert Foster has 16 years investment experience in Japanese and Asian equities, seven of them as a long/short fund manager. ))FOR MORE ON MATRIX ASSET MANAGEMENT Search www.adviserhound.com Capital preservation Despite a definite thirst fo r income among investors , Matrix does not offe r income products , choosing to focus on absolute r etu rns . "One of th e mos t impor tant prin- ciples du rin g t imes of market stress and volatility is th e p ri ncipal of capital sta- bility. We ar e looking to preserve our cli- ents wealth at a t ime wh en I t hin k we are going to se e equity markets undergo some volatility over the next 12-18 months." "I think rising commo d ity prices ar e now really fully being u nderst ood by con- sumers, becau se the price of food and petrol among other things has acceleratedt he largest source of available capital to third of returns from the short book. A lot to such a degree that, on top of t he reduc-companies desperate for cash flow. The gov- of fund managers just buy the index or tion in d isposable income , you feel youernment has a responsibility to continue to shor t the index- they do not short the indi- ar e caught in a vice. The macro environ-provide some sort of incentive for investors, vidual physical stocks. It is clear which sec- ment in t he UK is going to be ch allengingso I do not see the VCT product as coming tors will do well and which will not do well, over th e next 12-18 months, I do not seeunder pressure." in r esponse to some of the broader macro t hat stopping, but if people are prepar ed The firms number one product is its Asia themes we see in the emerging markets. to make investment positions, I th ink AsiaUCITS fund, a long/short hedge fund covering "We like Asia a lot, because GDP forecasts presents a much broader opportunity."Asian equities, including Japan. The fund is across the region are still at 6.5% and we think Along with Asia, Wool h ouse is bu llisha high conviction product that has delivered it is a very exciting area for us to be focused, on his ability t o grow Matri x s asset man-16.7% per annum in annualised returns since both as a business, and in terms of the fund." agement arm in the role of CEO. "Eve-inception in 2008. For those investors looking for genuine ryone h ere recognised they ne eded a CE O "We have just concluded a significant seed growth opportunities, Woolhouse remains for asset management and that there wasdeal with a leading European institution. As committed to the Asia growth story, so much a lot of potent ial within t h e division but itthe fund grows - it is now over $100m in size - so, Matrix is planning to open an office in n eeded to b e harnessed. On e of the fi r s tit starts to gather momentum. We spent a year Hong Kong. things I h ave done is reinforce internallyreally marketing the Cayman and the UCITS "This is something we are working on now to ever yone ther e is a real opportunity toversion of the fund and we are now about to - it will predomin antly be an investment be able to leverage what is the most uniqu emove to daily dealing, which is a very impor- office for Rupert Foster and his team, and manufacturing product development capa-tant attribute for the retail client base. Daily over time, it will evolve t o become more of a bility I have come across in my career.pricing makes the product more like a passive distribution arm." "We have m or e sophisticated productunit trust product - we will be doing this by In a broader sense, Woolhouse said he has creation skills in th is fi rm tha n anywher ethe end of March." concerns about rising inflation, a commodity else I have worked. But where we have per- Woolhouse added Matrix is in discussion bubble forming and the impact of the deficit h aps faile d historically is being able to lev-with key platforms including Towry Law, on UK households, all of which could drag on erage those skills to the broadest possibleStandard Life, Skandia, Hargreaves Lansdown economic growth. distribution audience."and Bestlnvest to offer its Asia UCITS fund to While there are many views on when He added: "I was attracte d to Matrixsretail investors. interest rates should be raised, Woolhouse diversified fin ancia l ser vices group , The funds manager, Rupert Foster, is believes the full impact of the deficit reduc- with its pr op erty busin ess, investmen tone of the few that can derive alpha from tion programme, on everyth ing from goods b anking business, and as set m anagementthe short b ook, said Woolhouse. "He is as and services to disposable income, will really business . Strategically, it is so importantaggressive in the stocks he does not own hit within the next six to eight months, which for a group to h ave three strong legs to theas the stocks he does - he used to make a could corrode confidence. same stool."