Zephyr Financial Solutions

How Asset Managers Can Tell Their Story With Integrity and Conviction

Being able to tell your investment and strategy story concisely and with integrity, making sure the messaging matches the investment processes and performance is vital for asset managers.

Wealth Management Edge 2024 brought together over 1,500 senior level advisors, tech innovators and wealth and investment management leaders to chart the future of the industry – and the Zephyr team were amongst them.

On the first of the four days, I had the pleasure of talking with two PSN Top Gun award winning managers in Bell Haven’s Stan Sattler and Xponance’s Cesar Gonzalez during our “Investing in SMAs to grow your AUM and personalize your client’s investment journey” panel, part of the WealthStack series of discussions. During this very insightful conversation, I asked Stan and Cesar due diligence questions about their Top Gun award winning strategies, and a lot was learned from this fact-finding exercise regarding their respective investment processes, personnel and investment performance.

One take-away was clear: The importance of accurately expressing your strategy’s story concisely and with integrity, and, critically, making sure the messaging matches the investment processes and performance.

Using Zephyr’s investment analytics and PSN data to dig a little deeper, I went in to research the discussed strategies from Bell Haven and Xponance, and put to the test how their product stories matched the data – were they talking the talk, and walking the walk? 

Leveraging Data to Uncover Investment Objectives

My goal was to ask a number of due diligence questions during the panel and utilize the capability of Zephyr to determine if the stated investment objectives matched what the research and analysis suggests. I posed the questions:

  • Does the team’s investment performance over time match their stated investment objectives, the ones investors would be expecting?
  • Were performance and style characteristics consistent over time throughout different market regimes? Or did performance behavior and style shift?

So, with questions decided and asked of the panel, where to start on the platform?

First, I looked at each strategy’s qualitative data in the PSN database to determine the investment objective, if they were sufficiently staffed, the tenure of their key portfolio managers, and other firm level information. Second, I took a deep look at the return, risk, and style characteristics for the strategies we decided to highlight. 

Does the Investment Performance and Fact Finding Support the Story?

Combining the data found in Zephyr with responses to my due diligence questions started to paint a picture: Investment performance was supporting the narrative from Belle Haven and Xponance. The synchronized stories, answers and investment analysis gave me confidence that the firms, and investment management teams behind the scenes, are committed to their respective investment strategies.

So, how can other asset management firms also successfully tell their stories with integrity?

Tell Your Investment Story

The story we paint for investors forms an important part of the marketing and retention for an asset management firm. So, it’s important to make sure the investment processes and performance do match the investment objective and “story” being told. If not, the fallout can reach farther than just returns in today’s investment world; the firm could lose credibility and client confidence.

Investors want to make sure their investments align with their values and beliefs more than ever. That means investors demand transparency in the investment process, holdings and personnel. It’s important that asset management firms can clearly and accurately articulate investment performance behavior through periods of good and bad performance with honesty, and in a timely manner – this can be make or break in terms of delivering a good or great experience.

But often the task of building and positioning reports with the company’s compliance, marketing, and product needs at the forefront can be challenge, before you then add in the requirement to also provide financial advisors with an on-demand approach to running reports.

An investment management platform like Zephyr gives asset management firms, and financial advisors, the ability to achieve their storytelling goals accurately, with confidence and at scale, by:

  • Designing customized templates that successfully narrate your firm’s story through engaging data, graphs and tables.
  • Creating company branded external reports and templates that are compliance approved.
  • Establishing brand guidelines to include color theme, font, logo, investment professional biographies, firm history and disclosures.
  • Screening the competitive landscape by using quantitative and qualitative metrics.
  • Creating workbooks with dashboard capabilities to seamlessly view strategy and competitor performance with 170 MPT statistics at their fingertips.
  • Researching strategies respective to universes, style and more.

It’s a good exercise for any asset management firm to ask: Does your investment performance and behavior match your product narrative? Is your story reflective of reality?  And, most importantly, how are you demonstrating this clearly to your investors?

About the Author

As Zephyr’s Market Strategist, Ryan Nauman provides analysis and research on market trends across asset classes, sectors, and regions to help empower better asset allocation strategy decisions. He is an accomplished investment strategist who has spent the last 22 years in the investment management industry ranging from working with plan sponsors, managing the investments of retail investors, and providing actionable thought leadership to investment professionals.  

Nauman is the host of the popular A to Zephyr and Adjusted for Risk podcasts. He is a well-respected investment industry strategist regularly featured on TD Ameritrade Network, Yahoo! Finance, Bloomberg TV, Bloomberg Radio and Chuck Jaffe’s Money Life podcast. His opinions and market expertise have been published in Reuters, CNBC, Bloomberg, MarketWatch.com, Yahoo! Finance, and the Wall Street Journal.