Dynamic Planner Training Academy - 02 October Newcastle

©2019 Distribution Technology Ltd. All Rights Reserved.
Autumn 2019
Training Academies
Newcastle

Housekeeping
Please switch off your mobile phones
Toilets
Fire drills

Agenda
09:00 – 09:30 Breakfast, registration and networking
09:30 – 09:40 Introduction and welcome
09:40 – 10:10 Dynamic Planner Client Success (live demo) – Client Case Study, a ‘how to’ session
10:10 – 10:40 Dynamic Planner Asset & Risk Modelling – The Importance of Fund Risk Profiling
10:40 – 11:00 Refreshments and networking
11:00 – 11:20
Dynamic Planner Client Success (live demo) – Client Review Process Update, what is new
and what’s coming up in ‘Elements’
11:20 – 11:50 Partner session 1
11:50 – 12:20
Dynamic Planner Client Success – ‘Let me show you how’, common questions asked by our
clients
12:20 – 12:40 Partner session 2 - Global economic update
12:40 Lunch and networking – A chance to ask questions one-on-one

Introduction & Welcome
Dynamic Planner

Dynamic Planner Case Study:
Retirement Planning
Client Success Team

Learning objectives
Client Profile
Name: Andrew Green
DOB: 10/02/1970 (50 next birthday)
Retirement Portfolio: Circa £450k in Scottish Widows Personal Pension Plan.
Objective: retire at 60 and enjoy flexibility under drawdown
Learning Objective
To be able to understand the required information and steps needed to create a
Retirement Wealth Plan for Andrew.
Demonstrate how to perform the following in order to meet Andrew’s objectives:
→ Pension Transfer
→ Rebalance portfolio
→ Annual review (Session 2)

Begin in ‘Client record’

Select the relationship type

Always remember to name your case

Case control centre

Existing arrangements

Investor experience

‘15 Question Attitude to Risk’

Consistency check

‘Capacity for risk’

‘Select a risk profile’

Value at Risk

Analysis

Efficient frontier

Recommendations

Product actions

Portfolio Suitability Hub

Fund filters

Search by Citicode, ISIN or MEXID

Add to portfolio

Align weightings accordingly

Asset allocation – Recommendation
Click Finish Button

Transferred to new policy

Reporting

Report preview

Close down your case

‘Product summary’

Complete case and update client

‘Client confirmation update’

‘Complete case’

Dynamic Planner –
The Importance of Fund Risk Profiling
Jim Henning, Head of Investment Services
Jason Dewar, Head of Fund Research

Learning outcomes
→ Dynamic Planner Asset & Risk Model
Philosophy
→ Foundations of the Fund Risk
Profiling service
→ Centralised retirement process risk
mitigation strategies

Why is forward-looking fund risk profiling important?
→ Last 20 years have seen volatility for higher yield debt and equity fall considerably
→ Now similar levels to UK gilts
→ Interest rate normalisation and end of benign markets ahead?
Source Lipper – Rolling 3 year period volatility

Volatility compression continues, but spikey Interest rate normalisation ahead?

Global financial system going back on Methadone Bond yields at historic lows → duration risk higher
-2
0
2
4
6
8
10
12
%Yield
Govt Bond 10 Year Yields
10YR UK Govt 10YR US Govt 10Y Bunds

Dynamic Planner Fund Risk Profiling
→ Not based on past performance
→ Not based on sector asset ranges where divergence of outcomes can be wide
→ Not based on an arbitrary equity index relative scoring
0
20
40
60
80
100
120
140
1 2 3 4
Frequency
SRRI score
Mixed Investment 40-85% Shares
0
2
4
6
8
10
12
annualisedvolatility%
Annualised Volatility - last 5 years
Dynamic Planner Approach
→ Risk-adjusted benchmark ex-ante analysis → Client centric
Source Lipper/Dynamic Planner
max
max
min

Dynamic Planner Asset Allocation philosophy
Ensures ongoing investment suitability by translating these characteristics
to the needs, objectives, situation and risk profile of the client
Equity Risk, Interest Rate Risk,
Currency Risk, Basis Risk
Holding Period Risk, Credit Risk,
Liquidity Risk, Concentration Risk,
Counterparty Risk

Robust basis for Fund Risk Profiling – Quarterly oversight
Asset Allocation Comparison to Dynamic Planner
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
0.0% 2.1% 4.2% 6.3% 8.4% 10.5% 12.6% 14.7% 16.8% 18.9% 21.0%
Expectedrealreturn(%pa)
Expected volatility (% pa)
DT profiles
Multi Asset Growth I
Multi Asset Growth II
Multi Asset Growth III
Multi Asset Growth IV
Forward looking analysis

Robust basis for Fund Risk Profiling – Quarterly oversight
The historical volatility
‘journey’ relative to the
Dynamic Planner asset
allocation
Measured by tracking
error analysis
Helps to understand the level of
risk being taking
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Quarterly time series
Fund Volatility Risk Profile 4 Risk Profile 5 Risk Profile 6
Rear view ‘sense check’

Dynamic Planner Fund Risk Profiling services
Risk Target ManagedRisk Profiled
→ Portfolios managed in line with
Dynamic Planner model assumptions  
→ Additional investment
consultancy from Dynamic Planner  
→ Dynamic Planner Risk Profile
may change  
627 FRP’d funds + 617 DFM portfolios 72 RTM funds + 38 DFM portfolios

‘Cruise’
Active
‘Coronation St’
Sedentary
‘Care home’
Dependent
Day to day needs: Housing, Food, Heating
Regular discretionary:
Meals out
Leisure
One-off discretionary:
Holiday
Care costs
Needs in retirement
→ Average size of pension pot going into drawdown is £123,000*
→ Joseph Rowntree Foundation says a retired couple need a minimum of £13,500 pa
→ Yet clients will need to spend additional money at key life stages
Applying Fund Risk Profiling to a Centralised Retirement Proposition
£
Care costs
Drawdown from capital
inevitable for most
*Source FCA data bulletin – Sept 2018

→ Rate variability
→ Capital &
income erosion
→ Increasing life
expectancy
→ Long-term care
funding
→ Income
variability
→ Capital
uncertainty
→ Fixed
withdrawals
→ Pound cost
ravaging Sequencing
Risk
Investment Risk
Inflation RiskLongevity Risk
Drawdown risk cycle – Four key segments

Applying Fund Risk Profiling to a Centralised Retirement Proposition
The problem for natural yield investors
→ What level of risk am I taking to generate attractive income?
→ What is the expected level of risk?
→ How consistent is the income stream and capital variability?
→ Which peer group analysis is relevant?
The Solution
Income Focus Research Reports –
for Multi Asset funds
Premium / Select Research –
for Single Sector & Multi Asset funds

Premium and Select Research ratings
Sector Peer group
Single Sector Funds IA sector classifications
Multi-Asset Fund DP’s 1-10 Risk Benchmarks
Risk Targeted Funds Relative to the RTM fund families
The rating considers a fund’s consistency (or fit) against the Dynamic
Planner asset and risk model and its efficiency in delivering returns.
A uniform scoring matrix and ranked within a relevant peer group.
5 years 3 years

Sequence of returns – An actual example
Example: popular MA fund
Dynamic Planner Risk Profiled 4
Over seven years £10,000 made
total return of £16,348 (7.3% pa)
This risk has been unnoticed because of benign
markets (blue line)… but the risk hasn’t gone away
If: Fixed £ monthly withdrawal of
£41.67 pcm (so 5% of original pa)
The outcome can vary by 53%
depending on monthly sequence
of returns

The impact of volatility drag
1%
5% 11%
25%
43%
67%
100%
150%
233%
-1% -5%
-10% -20%
-30%
-40%
-50%
-60% -70%
-100%
-50%
0%
50%
100%
150%
200%
250%
Gain required to fully recover from a loss
Gain to recover
Amplification of
sequencing risk
when more
volatility occurs.
Loss
So reduce volatility
to mitigate the
sequencing risk

Sequence risk mitigation via our Fund Risk Profiling services
The problem for decumulation investors:
“There has been little in the way of product innovation in retirement income products
since pension freedoms came into force.” FCA Sector Views, January 2019
The solution: A new asset and risk model service to asset managers
New asset allocation framework
Measures and monitors the risk of a fall in value on a monthly basis
Ensures the risk to the client’s capital remains the same over the annual client review period

How effective Risk Managed solutions can be identified and profiled
Monthly Risk Control Required to be RMD
Fixed
Income
Property
Cash
Absolute
Return
Risk of short-term correlation with equities
Over exposure to inflation risk
Liquidity risk and risk of gating
Short-term downside protection
Ideally Market Neutral Hedge funds
More negatively correlated to equities in short-term
Less inflation risk
Mandates and objectives focused on short-term risk

A new standard for decumulation solutions
Badges will be applied to the RMD solutions
from asset managers when joining the service

Fund research landing page will show where to find RMD funds

Centralised Retirement Proposition – Challenges addressed
→ Rate variability
→ Capital &
income erosion
→ Increasing life
expectancy
→ Long-term care
→ Income
variability
→ Capital
uncertainty
→ Fixed
withdrawals
→ Pound cost
ravaging
Sequencing
Risk
Investment
Risk
Inflation Risk
Longevity
Risk
 Asset & Risk
Model
 Income Focus &
Research Reports
 Asset &
Risk Model
in real terms
 Cashflow
modelling

Thank you

Refreshments and networking

Dynamic Planner Elements /
Client Review Process Update
Client Success Team

What our clients say
“I don’t think there is anything else out there like this – it’s a new document for
a new process, which, because of MiFID II, advisers have to produce now,”
said Chris Miller, Miller Associates.
“Dynamic Planner is way ahead of the pack with this,”
said Nick Ryan, Yellow Bear Financial Consultancy.
“It’s the way forward for me as an independent adviser,”
said Dmitry Morgan, Morgan Financial. “It puts me in the same position as
large national firms, in terms of their very slick presentation and will definitely
save me time.”
“Elements produces an impressive report, which demonstrates to your clients
that as a firm you are professional and you know what you’re doing,”
said Gary King, GK Financial Solutions.

How to access Elements

New Elements service

Arrangements

Risk

Selection

Objectives

‘Past performance’ and benchmarks

Forecast

Charges

Outcomes

Investment Progress Review report

Report

Dynamic Planner Roadmap
Sept 2019 Oct / Nov / Dec 2019 Jan / Feb / Mar 2020 Apr / May / June 2020
Novia integration Cashflow trial
Suitability trial
RMD funds available in
software
Cashflow launch
Suitability launch
Cashflow
Suitability
Save The Date!
2020 Dynamic Planner Annual Conference
Manchester 28 Jan 2020
London 5 Feb 2020

This document is confidential and intended solely for the use of the person to whom it is given or sent and may not be reproduced,
copied or given, in whole or in part, to any other person.
GAMManaged FundSolutions
Dynamic Planner Training Academy
October 2019
Marketing material for professional investors only.
Tony Morton
Client Manager

7 investment centres in Europe, the US and Asia
Source: GAM.
Data as at 30 Jun 2019, excluding GBP 0.81 billion ARBF-related AuM in liquidation. 1. The assets under management breakdown applies to GBP 42.0bn assets managed
within the Group’s investment management area; it excludes assets of GBP 67.7bn in the Group’s private labelling business.
Distinctive product offering combined with significant global presence and reach
Group overview
Overview
 Independent asset management group focused on active investing
 GBP 109.7bn in assets under management, of which
 Investment management business is GBP 42.0bn
 Private label business is GBP 67.7bn
 SIX Swiss Exchange listed company
 Distinctive offering covering the full spectrum of asset classes and
strategies
AUM1 by product type
AUM1 by client type
AUM of GBP 42.0bn in the Group’s investment management business
46%
47%
7%
Intermediaries
Institutional clients
Private clients
52%
13%
15%
9%
8%
3%
Fixed Income
Multi Asset
Equity
Systematic
Alternatives
Absolute Return
863 employees in offices in 14 countries
New YorkLondon Zurich LuganoHong Kong MilanCambridge

RUGBY…
AND HOW IT RELATES TO
INVESTOR PSYCHOLOGY

Understanding our Emotions
Source: GAM
The views are those of the manager and are subject to change.
2007
Runners up
2011
Lose in
quarter finals
2015
Knocked out in
group stages
Emotionalsensitivity
HighHighLow
2003
Winning the
world cup
2015
Eddie Jones
appointed
Head coach
2019
Winning the Japan world cup???
2016
6 Nations Grand Slam and
whitewash Australia
Would you continue to support…?

79
Investing is also emotional
Source: GAM
Maximum
financial
opportunity
Maximum
financial
risk
Emotionalsensitivity
HighHighLow
Euphoria
Capitulation
Euphoria
Depression
Hope
Optimism
Excitement
ThrillAnxiety
Denial
Fear
Desperation
Panic
Would you stay invested… ?

Chart comparing flows to equity funds related to a 12 month S&P 500 Index return
80
Emotional investing in practice…
Source: blog.wealthfront.com, “Investors’ Most Serious Mistake” – 28 Feb 2013
Past performance is not an indicator of future performance and current or future trends.
For illustrative purposes only

81
Timing the market is difficult
Source: Prepared by J.P Morgan Asset Management using data from Lipper. 20-year annualized returns are based on the S&P 500 Total Returns Index, an unmanaged,
capitalization-weighted index that measures the performance of 500 large capitalization domestic stocks representing all major industries. Past performance is not indicative
of future returns. An individual cannot invest directly in an index. Data as at30 Jun 2016.
This chart is for illustrative purposes only and does not represent the performance of any investment or group of investments. Past
performance is not an indicator of future performance and current or future trends.
$65,453
(9.85% return)
$32,665
(6.10% return)
$20,354
(3.62% return)
$13,446
(1.49% return)
$9,140
(-0.45% return) $6,392
(-2.21% return) $4,570
(-3.84% return)
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
Fully Invested Missed 10 best
days
Missed 20 Best
days
Missed 30 best
days
Missed 40 best
days
Missed 50 best
days
Missed 60 best
days
Did you know six of the 10 best days occurred within
two weeks of the 10 worst days?
Performance of a $10,000 investment between 3 Jan 1995 and 31 Dec 2014
Returns of the S&P 500 For illustrative purposes only

Source: Financial Express analytics. Assumes: nil Initial Charge and no switching charge.
The mentioned financial instruments are provided for illustrative purposes only and shall not be considered as a direct offering, investment recommendation or investment
advice. Allocations and holdings are subject to change.
Starting with a GBP 1,000 investing in arrears in the top performing fund over 12 months
Fund picking: The benefits of hindsight…

84Source: Financial Express analytics. Assumes: nil Initial Charge and no switching charge.
Starting with a GBP 1,000 investing in last year’s top performing fund
… and now the reality!

Every asset class has its day
The need for a professionally managed, multi-asset solution
Source: RIMES, MSCI, Bloomberg, as at 31 Dec 2018.
Indices represented by: Lipper Global Mixed Asset GBP Balanced (GAM Hedged) in USD, HFRX Global Hedge Fund Index in USD, MSCI World Index in USD, MSCI Emerging Markets Index in USD, Barclays Global Agg
Credit Total Return Index Hedged in USD, FTSE (WGBI) World Govt. Bond Index in USD, Barclays Macro: Global High Yield Bond Index in USD, Average USD 1 Month Deposit Rate. The mentioned financial instruments
are provided for illustrative purposes only and shall not be considered as a direct offering, investment recommendation or investment advice. Allocations and holdings are subject to change.
Past performance is not an indicator of future performance and current or future trends. Funds do not have the security of capital
that is characteristic of a bank deposit.
2013 2014 2015 2016 2017 2018
Simple performance returns
For illustrative purposes only.
Highest
return
(%)
Lowest
return
(%)
85

Every asset class has its day
The need for a professionally managed, multi-asset solution
Source: RIMES, MSCI, Bloomberg, as at 30 Jun 2019.
Indices represented by: Lipper Global Mixed Asset GBP Balanced (GAM Hedged) in USD, HFRX Global Hedge Fund Index in USD, MSCI World Index in USD, MSCI Emerging Markets Index in USD, Barclays Global Agg
Credit Total Return Index Hedged in USD, FTSE (WGBI) World Govt. Bond Index in USD, Barclays Macro: Global High Yield Bond Index in USD, Average USD 1 Month Deposit Rate. The mentioned financial instruments
are provided for illustrative purposes only and shall not be considered as a direct offering, investment recommendation or investment advice. Allocations and holdings are subject to change.
Past performance is not an indicator of future performance and current or future trends. The performance is net of commissions,
fees and other charges. Funds do not have the security of capital that is characteristic of a bank deposit.
Highest
return
(%)
Lowest
return
(%)
Simple performance returns
For illustrative purposes only.
2013 2014 2015 2016 2017 2018
6.1%
0.8%
10.6%
2.8%
0.8%
1.2%
5.1%
3.9%
2013-2019 H1
(ann.)
6.8%
86

WHY INVEST INAN
ACTIVE
MULTIASSET SOLUTION

Source: GAM
Three key benefits
Investing in an actively managed multi asset fund
Avoid the pitfalls of
emotional investing
Avoid the issues
of fund picking
Benefit from a one-stop,
fully diversified portfolio
 The nature of “buy low, sell high” is often
overlooked when personally investing
 Individuals frequently sell out of loss-
making positions for the fear of greater
losses, or buy into over-priced assets due
to excitement over expected superior
returns
 Active asset managers invest solely for
the benefit of their clients, and only make
investments based on rigorous analysis
and due diligence, as well as with
complete conviction and sound economic
reasoning
 It can often be very easy to invest in funds
that have had a recent spell of excellent
performance, or funds that gained a great
deal of popularity
 Very rarely can fund managers sustain
long periods of superior performance, and
often spells of strong performance are
followed by periods of below-par
performance
 Active multi manager funds seek to invest
in funds that can demonstrate consistent
long-term performance above their
benchmark
 A wealth of research and evidence exists
to support the benefits of a fully diversified
portfolio, but this can be difficult to
achieve in practice
 Many decisions such as the right asset
class mix, how much attention is paid to
changing economic environments,
accessibility of funds, transaction costs
and more need to be considered
 Active multi asset, multi manager funds
combine all of the benefits of
diversification while removing the
responsibility of individual decision-
making

89Source: GAM
The views expressed are those of the manager and are subject to change.
The benefits for you and your clients
Why consider GAM Managed Fund Solutions?
GAM Managed Fund Solutions offers investors: Benefits for intermediaries:
Choice
Five multi-asset, risk-targeted funds
designed to suit a range of different client
needs
Flexibility
Each portfolio invests in actively managed
funds with a change in emphasis between
capital preservation and capital growth
Expertise
The funds combine GAM’s expertise in
manager research, asset allocation and
active investment management
Freedom
These core, outsourced investment
solutions can help to save time and create
efficiencies within your business
Simplicity
Help to reduce the burden of investment
selection and portfolio management and
ensure the portfolio is appropriate for each
client
Control
With GAM’s investment specialists
navigating financial markets on your behalf
you have more time to concentrate on your
all important client relationships

Source: GAM.
For illustrative purposes only.There is no guarantee that targets will be achieved. The mentioned financial instruments are provided for illustrative purposes only and shall not be
considered as a direct offering, investment recommendation or investment advice. Allocations and holdings are subject to change.
An overview of the fund range

Performance from 21 Nov 2012 to 30 Aug 2019
Source: GAM
¹Full legal name: GAM Star Fund plc. - GAM Star Dynamic Growth. ²Full legal name: GAM Star Fund plc. - GAM Star Growth. ³Full legal name: GAM Star Fund plc. - GAM Star
Balanced.4Full legal name: GAM Star Fund plc. - GAM Star Cautious. 5Full legal name: GAM Star Fund plc. - GAM Star Defensive.
fees and other charges.
12.6 – 14.7
8.4 – 10.5
6.3 – 8.4
4.2 – 6.3
Vol Target
10.5 – 12.6
¹
²
³
4
5
Performance of GAM Managed Fund Solutions
(Since inception of GAM Star Global Defensive – GBP Institutional)

Performance from 1 Jul 2013 to 30 Aug 2019
Source: GAM
93
12.6 – 14.7
8.4 – 10.5
6.3 – 8.4
4.2 – 6.3
Vol Target
10.5 – 12.6
¹
²
³
4
5
Performance of GAM Managed Fund Solutions
(Since inception of GAM Star Global Cautious – Z GBP)

Performance of GAM Managed Fund Solutions – (YTD)
Performance from 31 Dec 2018 to 30 Aug 2019
Source: GAM
94

UK equities vs the Rest of the World
Performance from 2 Sep 2009 to 2 Sep 2019
Source: RIMES, MSCI

UK equities vs the Rest of the World
Annualised performance from 2 Sep 2009 to 2 Sep 2019
Source: RIMES, MSCI

98Source: GAM
vs Dynamic Planner
Asset Allocation
Dynamic Planner UK DT 5 GAM MFS Star Balanced % Difference
Cash (Money Markets) 5% 9% +4%
UK Gilts 3% 0% -3%
UK Index Linked Gilts 4% 0% -4%
Sterling Corporate Bonds 19% 6% -13%
Global Inv Grade Bonds 4% 24% +20%
UK Equity 23% 8% -15%
Europe Ex UK Equity 5% 9% +4%
North American Equity 16% 12% -4%
Japanese Equity 6% 9% +3%
Asia Pacific Ex Japan Equity 5% 5% -
Emerging Markets Equity 5% 7% +2%
Property 5% 3% -2%
Commodities 0% 4% +4%
Absolute Return 0% 5% +5%
100% 100%

99Source: IA
GAM MFS global positioning verses competitor funds
Fund UK Equity Global Equity Total Equity
GAM Star Global Balanced 8.1% 52.0% 60.1%
Quilter Cirilian Moderate 15.0% 47.7% 62.7%
L&G Multi-Index 5 12.6% 42.3% 54.9%
Rathbone Multi Asset Strategic Growth 16.3% 45.9% 62.2%
SVS Cornelian Managed Growth 16.2% 30.0% 46.2%
SLI MyFolio Managed IV 22.8% 33.6% 56.4%
BMO MM Lifestyle 5 21.7% 36.5% 58.2%
Premier Liberation V 27.0% 29.0% 56.0%
Santander Atlas Portfolio 5 16.5% 41.9% 58.4%
Average 17.4% 40.0% 57.2%

GAM Star Global Balanced
Asset Allocation analysis history - Equity from 31 Oct 2012 to 31 Aug 2019
Source: GAM

GAM Global Growth v IA Flexible in 2013: +8%
Performance from 1 Jan 2013 to 31 Dec 2013
Source: MSCI, RIMES, Thomson Reuters
Past performance is not an indicator of future performance and current or future trends. Performance is shown net of management
fees of the underlying funds held but gross of management fee at the portfolio level.

GAM Global Growth v IA Flexible in 2015: +1.9%

GAM Global Growth v IA Flexible in 2017: +3.7%

GAM Global Growth v IA Flexible in 2019: +3%
Performance from 31 Dec 2018 to 6 Sep 2019

Source: GAM
The views expressed are those of the manager and are subject to change.
Learning objectives
Summary
Awareness
Investors can be their own
worst enemy, particularly
when fund picking and trying
to time the market
Risk Profiled
GAM MFS is aligned to
Dynamic planner Risk Profiles
3 to 7
Diversification
Benefits of Diversification
Global
Be disciplined with
Diversification by thinking
global

Dynamic Planner –
Frequently Asked Questions
Client Success Team

FAQs
Question 1. Risk Profile Client Invites – how to send and import data
Question 2. How to use research tools in Portfolio Suitability Hub
Question 3. How to find a risk score of funds that do not have a Dynamic Planner risk rating?

Qu1 Risk Profile Client Invites – How to send and import
→ Secure link via email
→ Makes face-to-face time with clients more efficient
→ Additional cost on top of Dynamic Planner licence
→ 10 invites for £10 per month (excluding VAT)
→ 250 invites for £15 per month (excluding VAT)
→ Easy import of answers into the service

Qu1 Risk Profile Client Invites – How to import answers

Qu1 Create a new case to import answers

Qu1 Case control centre

Qu1 Import functionality

Qu1 Import functionality splash screen

Qu1 Attitude To Risk – Import

Qu1 Expired invites – Send reminder

Qu1 Send reminder

How to use research tools in
Portfolio Suitability Hub

Landing Page – Portfolio Suitability Hub

Qu2 Charting service

Qu2 Charting – With ‘Sector’

Qu2 Charting report

Qu2 Filtering for suitability
→ Risk Profile 5
→ Premium
→ Active Management Style

Qu2 Pulling a report in Portfolio Suitability Hub

Qu2 Comparison

Qu2 Comparison report

How to find the risk score of funds that do
not have a Dynamic Planner risk rating?

Qu3 Portfolio Suitability Hub

Qu3 Fund selection

Qu3 Save as ‘Model portfolio’

Qu3 Model portfolio splash screen

Qu3 Model portfolio report

Qu3 Model portfolio

Training & Consultancy
Training on Dynamic Planner and bespoke consultancy is available for our users.
You can:
1) Access nine on-demand training videos - from Risk Profiling to Retirement
Planning to Elements - at: www.dynamicplanner.com/training-videos
2) Have paid-for training in your office or at the Dynamic Planner offices in
Reading
For full details, contact Client Success on 0333 6000 500 or at
support@dynamicplanner.com – or contact your Account Manager directly

 Scenario 1: Fed continues to drain liquidity and China refuses to jump start the world economy – oil trades in a tight range. The US deficit
crowds out money from private sector and ECB ends quant easing. Overpriced assets of early 2018 (tech) continue to deflate but value
starts to meaningfully outperform
 Scenario 2: Oil stumbles. Global growth continues to slow. Fed intercedes and becomes more dovish putting rate rises on hold – dollar
supremacy starts to fall. Asia gets the holy trifecta of easier Fed, falling oil and weaker dollar – EM and Asia enter bull market
 Scenario 3: Fed does a U-turn and re-injects liquidity into the system. Unlikely until we see some systemic blow-up eg Italian recession,
banking system collapse, China hard landing and/or China banking system, US corporate bond market collapse
 Scenario 4: China rides to the rescue as they did in 2012 and 2015. Their focus is on domestic protection rather than saving the RoW. A
massive stimulus would likely cause more currency related weakness which would exacerbate any export slowdown already underway - so a
moderated stimulus only this time round
 On balance we do not see a recession (either a US or a global one) in 2019 – market price adjustments in Q4 2018 had gone too far and
were too quick. A slowdown was clearly starting to take effect at the start of 2018
 Central bank action has inevitably become more supportive again and the narrative needs to walk a fine line avoiding a panic and to help lift
sentiment again
 Resolutions to the current trade war will provide an immediate relief rally - both sides are firmly entrenched but Trump must realise he wont
see any economic benefits from this approach under his watch. China seems more than happy to ‘wait’ him out
2019 – what we thought at the start of the year

China credit management global swing factor now
1 year rolling returns from 31 Jul 2006 to 31 Jul 2019
Source: MSCI, Bloomberg

Policy uncertainty still elevated
From 31 Mar 1997 to 31 Jul 2019
Source: Bloomberg

Oil Price sets the expected inflation rate
From 14 Jul 2009 to 1 Aug 2019
Source: Bloomberg

The central bank punchbowl
1 year rolling returns from 31 May 2010 to 31 Jul 2019
Source: Bloomberg, MSCI
YoY decline of $787bn in central bank assets. Returns generally directed by central bank flow

Bond markets are telling you something
From 30 Sep 1992 to 31 Aug 2019
Source: Bloomberg
Overly restrictive monetary policy de-stablises growth. Recession risks may not be immediate, but the direction of trend points to a slowdown. including the potential
for an inversion of the yield curve.

Financial Conditions - sub indices
From 31 Mar 1971 to 23 Aug 2019
Source: Bloomberg
The risk sub-index captures volatility and funding risk in the financial sector;
The credit sub-index is composed of measures of credit conditions
The leverage sub-index consists of debt and equity measures.
Increasing risk, tighter credit conditions and declining leverage are consistent with increases in the NFCI. Always precede a recession when some or all go positive.
Tighter financial conditions
Looser financial conditions

US CAPE
From 1 Jan 1910 to 31 Aug 2019
Source: Shiller
• Shiller PE looks at inflation adjusted average earnings over 10 years. A level over 25 has been surpassed only four times historically – 1929, 1999 and 2007 and now.
• Major market drops followed those peaks
Overvaluation Zone
Fair value Zone
Undervaluation Zone

If equities look expensive, justify bond prices!
From 1 Jan 1963 to 31 Aug 2019
Source: Shiller, Bloomberg
• Another way to compare it on a relative basis is to look at 10 year risk free
• Each time InvCAPE crosses to the upside = strong buy. Each time InvCAPE crosses to the downside = sell
• Basically saying the earnings yield on stocks is now worse than on risk free
• Investors buy equities now for yield/income
characteristics
• And buy bonds (on negative yields) for capital
appreciation!

The recession indicators to watch
From 31 Mar 1970 to 31 Jul 2019
Source: Bloomberg
US LEI: 1)Avg weekly hours (manufacturing) 2)Avg weekly unemployment claims 3) Manufacturers new orders, consumer goods and materials 4)Manufacturers new orders, non-defence capital goods
excl aircraft 5)ISM New orders 6) Building permits 7)S&P 500 Index 8)Leading Credit Index 9)Int rate spread 10 yr to Fed funds 10)Avg consumer expectations for business conditions

The UK economy may already be in recession
From 31 Mar 1971 to 30 Jun 2019
Source: Bloomberg
UK LEI: 1)Order book volume (CBI) 2)Vol Expected Output (CBI) 3)Consumer Confidence (EC) 4)FTSE ALL Share 5)Yield spread (BoE) 6) Productivity, whole economy (ONS) 7)Total Gross Operating
Surplus (ONS)
The mentioned financial instruments are provided for illustrative purposes only and shall not be considered as a direct offering, investment recommendation or investment advice.
Allocations and holdings are subject to change.

Source: GAM
advice. Allocations and holdings are subject to change. Totals may not sum due to rounding.
Asset allocation analysis as at 5 Sep 2019
GAM Star Global Balanced
60.1%
23.0%
6.4%
4.6%
6.0%
Equity Fixed Income
Alternatives Absolute Return
Net current assets

Equity carve-out
Source: Lipper
77% of managers outperformed
60% of managers outperforming
18% of managers outperformed
GAM Star Balanced – Equity Long ( Level 1) is a performance series based on the Equity portion of the GAM Star Balanced Fund. It is not in itself a fund or strategy that can be
accessed separately and so its performance must always be viewed in the context of the wider GAM Star Balanced Fund (GAM Star Fund plc. - GAM Star Balanced).

Fixed Income carve-out
Source: RIMES
67% of managers outperformed 20% of managers outperformed
GAM Star Balanced – Fixed Income Long ( Level 1) is a performance series based on the Fixed Income portion of the GAM Star Balanced Fund. It is not in itself a fund or strategy
that can be accessed separately and so its performance must always be viewed in the context of the wider GAM Star Balanced Fund (GAM Star Fund plc. - GAM Star Balanced).

Alternative carve-out
Source: GAM
Statistics herein based on currency hedged indices, identified by ‘(GAM hedged)’ in their title, have been calculated by GAM with the aim of valid comparison to our currency hedged products. Details of their
calculation are available on request. GAM Star Balanced – Alternative Investments ( Level 1) is a performance series based on the Alternative portion of the GAM Star Balanced Fund. It is not in itself a fund
or strategy that can be accessed separately and so its performance must always be viewed in the context of the wider GAM Star Balanced Fund (GAM Star Fund plc. - GAM Star Balanced).

Absolute Return carve-out
Source: GAM
Statistics herein based on currency hedged indices, identified by ‘(GAM hedged)’ in their title, have been calculated by GAM with the aim of valid comparison to our currency hedged products. Details of their
calculation are available on request. GAM Star Balanced – Absolute Return Long ( Level 1) is a performance series based on the Absolute return portion of the GAM Star Balanced Fund. It is not in itself a
fund or strategy that can be accessed separately and so its performance must always be viewed in the context of the wider GAM Star Balanced Fund (GAM Star Fund plc. - GAM Star Balanced).

Source: GaveKal
The passive trap - Last decades winners rarely keep winning
Top 10 stocks by decade – winners rarely remain at the top

Dont believe the hype
Source: RIMES, MSCI

162
 Capital at risk – All financial investments involve an element of risk. Therefore, the value of the investment and the income from it will vary
and the initial investment amount cannot be guaranteed.
 Counterparty risk / derivatives – If a counterparty to a financial derivative contract were to default, the value of the contract, the cost to
replace it and any cash or securities held by the counterparty to facilitate it, may be lost.
 Leverage Risk – Derivatives may multiply the exposure to underlying assets and expose the Fund to the risk of substantial losses.
 Credit risk / debt securities – Bonds may be subject to significant fluctuations in value. Bonds are subject to credit risk and interest rate risk.
 Credit risk / non-investment grade – Non-investment grade securities, which will generally pay higher yields than more highly rated securities,
will be subject to greater market and credit risk, affecting the performance of the Fund.
 Credit risk / structured products – Should the counterparty to a structured note default, the value of those structured notes may be nil.
 Interest Rate Risk – A rise or fall in interest rates causes fluctuations in the value of fixed income securities, which may result in a decline or
an increase in the value of such investments.
 Currency Risk – The value of investments in assets that are denominated in currencies other than the base currency will be affected by
changes in the relevant exchange rates which may cause a decline.
Fund risks
Source: GAM

163
 Currency Risk [non base currency share class] – Non-base currency share classes may or may not be hedged to the base currency of the
Fund. Changes in exchange rates will have an impact on the value of shares in the Fund which are not denominated in the base currency.
Where hedging strategies are employed, they may not be fully effective.
 Market Risk / Emerging Markets – Emerging markets will generally be subject to greater political, market, counterparty and operational risks.
 Equity – Investments in equities (directly or indirectly via derivatives) may be subject to significant fluctuations in value.
 Operational risk / third parties – Investments in other funds have direct and indirect dependence on other service providers. The Fund may
suffer disruption or loss in the event of their failure.
 Liquidity Risk (Fund of Funds) – Investments in other funds are subject to the liquidity of those underlying funds. If underlying funds suspend
or defer payment of redemption proceeds, the Fund's ability to meet redemption requests may also be affected.
 Brexit Risk – The regulatory regime to which certain of the Investment Managers are subject to in the UK could be materially and adversely
affected. The decision to leave the EU could also result in substantial volatility in foreign exchange markets and a sustained period of
uncertainty for the UK, the EU and the global markets in general.
Fund risks
Source: GAM

164
Important legal information
Source: GAM, unless otherwise stated. (Where applicable and, unless otherwise noted, performance is shown net of fees, on a NAV to NAV basis). GAM has not independently verified the information from
other sources and GAM gives no assurance, expressed or implied, as to whether such information is accurate, true or complete.
This material is confidential and intended solely for the use of the person, persons or entities with nationality of or respectively with their residence, domicile or registered office in a State or Country in which
such distribution, publication, making available or use is not contrary to laws or other regulations, and may not be reproduced, copied or given, in whole or in part, to any other person. It is aimed at
sophisticated, professional, eligible, institutional and/or qualified investors/ intermediaries appointed by GAM who have the knowledge and financial sophistication to understand and bear the
risks associated with the investments described.
Nothing contained herein constitutes investment, legal, tax or other advice, nor is it to be solely relied on in making an investment or other decision. This document qualifies as marketing material.
The views expressed herein are those of the manager at the time and are subject to change. The price of shares may go down as well as up and the price will depend on fluctuations in financial
markets outside GAM's control. As a result an investor may not get back the amount invested. Past performance is not indicative of future performance and reference to a security is not a
recommendation to buy or sell that security.
This is not an invitation to invest in any GAM product or strategy. Investments should only be made after a thorough reading of the current prospectus, offering memorandum, the Key Investor Information
Document “KIID”, the articles of association and the current annual and semi-annual reports (the “legal documents”), as well as after consulting an independent finance and tax specialist. The legal
documents can be obtained in hard copy and free of charge from the addresses indicated below.
Some of the sub-funds may not be registered for sale in all jurisdictions. Therefore, no active marketing must be carried out for them. Subscriptions will only be received and shares or units issued on the
basis of the current fund prospectus.
Shares of the fund have not been registered under the US Securities Act of 1933, as amended (the “Securities Act”) and the fund is not registered under the US Investment Company Act of 1940, as
amended (the “Company Act”). Accordingly, such shares may not be offered, sold or distributed in the United States or to US persons unless an exemption from registration under the Securities Act and the
Company Act is available. In addition, certain GAM products are closed to all US investors.
This material/presentation mentions one or several sub-funds of GAM Star Fund p.l.c., registered office at George’s Court, 54-62 Townsend Street, Dublin 2, Ireland, an umbrella investment company with
variable capital and segregated liability between the sub-funds, incorporated under the laws of Ireland and authorised by the Central Bank of Ireland (CBI) as a UCITS Fund in accordance with the Directive
2009/65/EC. Management Company is GAM Fund Management Limited, George’sCourt, 54-62 Townsend Street, Dublin 2, Ireland.
UK: As far as UCITS described herein are recognised schemes under section 264 of the Financial Services and Markets Act 2000: Copies of the legal documents can be obtained in English, free of charge,
from the Facilities Agent GAM Sterling Management Limited, 8 Finsbury Circus, London, EC2M 7GB (authorised and regulated by the FCA) or on the internet at www.gam.com. Investments in the funds are
not protected by the Financial Services Compensation Scheme.
Within the UK, this material has been issued and approved by GAM London Ltd, 8 Finsbury Circus, London, EC2M 7GB, authorised and regulated by the Financial Conduct Authority.
Disclaimer

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