Miles hits back at Genesys research critics

Fortnum Financial Group executive chairman Ray Miles has hit back at what some have perceived was an attack on the investment research team formerly employed by Genesys Wealth Advisers and now working under the RI Advice group banner.

Genesys Wealth Advisers recently announced it had overhauled its model portfolio, which it said had underperformed for six years and as a result had lost considerable support from its advisers.

Miles said while Genesys is to be “congratulated for acknowledging its recent underperformance and trying to rectify it”, it was “hard to understand how anyone could describe the model as underperforming for six years”.

Miles and others formerly associated with the group argued the model portfolio had in fact outperformed over a 10-year period, prior to the defection of a number of Genesys investment researchers to ING-owned RI Advice Group. Former Genesys researchers Dinyar Irani, Cameron Sinclair, Dan Miles, and Diego Mainou made the move to RI Advice Group last year, although Mainou has since moved to Innova Asset Management. ING owns a 20 per cent stake in Fortnum and RI Advice Group provides Fortnum with adviser support services, including investment research.

“Some people have interpreted the announcement by Genesys as an attack on the research team that left 18 months ago,” Miles said.

“Until their departure, the former research team, led by Dinyar Irani, produced consistent and significant outperformance over a 10-year period. They were highly regarded due to their professional approach, diligence and ability to communicate with advisers to help advisers build investment portfolios for clients,” Miles said.

“It appears that the Genesys research function lost its way after the former research team left. Recasting portfolio strategies to rectify recent underperformance is a sensible thing for Genesys to do.”

Miles, the former chief of the group, said it was his understanding that more than 80 practices had left Genesys since mid 2007. Of those, more than a dozen have now joined Miles’ recently established Fortnum Financial Group.

“Adviser practices who have become members of the Fortnum Group have done so because they have confidence in the management of the Fortnum Group and the facilities and research function it has organised,” Miles said.

“Fortnum Group prefers to focus on its positives rather than on problems that Genesys is experiencing and has every confidence in the research team led by Dinyar Irani.”