Greencape Capital directors David Pace and Matthew Ryland believe their ‘best ideas’ investment strategy is key to winning this year’s Money Management/ IMCA Fund Manager of the Year Awards Rising Star category, but they concede their partnership with ChallengerFinancial Services would have played a part.
Challenger has taken a 25 per cent stake in Greencape Capital, which launched in September last year as a GARP manager, with two Australian equity funds.
Pace and Ryland and fellow director Marc Hester own the remaining 75 per cent capital in the manager. Greencape offers the Wholesale Broadcap Fund and Wholesale High Conviction Fund, both of which are managed in the ‘best ideas’ style.
They see the partnership with Challenger as an “acknowledgment” of their investment track record as portfolio managers with Merrill Lynch before they left to launch Greencape.
Greencape’s “best ideas” mentaility is highlighted by their intolerance for taking up positions that are related purely to index risk minimisation. The idea is to “have every dollar in the portfolio invested in stocks we like”, according to Pace and Ryland.
“We don’t want to have stocks making up numbers, or stocks in the portfolio just because a stock happens to be a big weighting on the index, because from our point of view that’s taking out money that’s best used in stocks that we really like.
Finalist, Patriot AssetManagement’s distribution partner and sister company in Australia is Fisher Graham Financial (FGF).
FGF managing director Peter Purpura said Patriot had a number of key differentiators.
“We’re not momentum investors, we don’t listen to market noise and we operate in our circle of competence using our proprietary multi-stage quantitative and qualitative research techniques to identify business key drivers of cash flow and profitability,” he said.
The other finalist, Platypus Asset Management, manages portfolios for institutional investors, high-net-worth individuals and retail investors through the Australian Unity Investments Platypus Australian Equities Trust.
Its portfolio manager, Philip Pepe, said a key aspect separating it from its competitors was its “performance culture”.
“Platypus has adopted a culture where only superior performance is rewarded,” he said.
“We believe that active fund managers should aim to outperform their benchmarks by margins that justify the fees they charge and the tax that is incurred.”