Marius Čiuželis on Traditional & Alternative investmentsInvestor / Advisor / Social EntrepreneurSome time ago
Is the term 'private banking' a thing of the past? The blurring of the lines and business models between the different types of wealth management firms raises important questions over whether 'private banking' is still relevant. Should we stop using it altogether? What does a 50-year old Swiss client adviser from UBS Wealth Management have in common with a 25-year old relationship manager from the VIP offering of a Lithuanian retail bank? In theory, very little. Yet in the way their respective institutions market each of them, and in the eyes of many newly-wealthy individuals, they are both ‘private bankers’. Although a slightly extreme example, this highlights a pressing question which shouldn’t be ignored any longer – what does ‘private banking’ actually mean? Surely there needs to be a clearer and more accurate definition of private banking in today’s environment? And how this differs from ‘wealth management’. After all, many HNW individuals still don’t know what a private bank should really stand for. Various types of organisations – not just private banks – are trying to service HNW customers. These include insurance companies, IFAs, multi-family offices, independent (or external) asset managers, just to name a few. And the existence of multiple providers is a good thing in terms of broader customer choice. The flipside is that it leads to greater confusion in the mind of a customer about who offers what, why and how. Some organisations have been called private banks for over 100 years, throughout which they have served wealthy family’s interests in Europe, the US and Asia. They use well-trained, experienced RMs to tailor centralised investment themes and other solutions to individual client preferences. At the other extreme, some local retail banks have set up ‘private banking’ divisions that are staffed by young, inexperienced salespeople, employed to sell a handful of high-margin funds. Both types of institution can call what they do private banking, employing RMs as client managers. Yet their approaches, and the resulting client experience, are poles apart. In the meantime, the current uncertainty leads to an understanding of what a private bank is and what it is supposed to do. Most organisations are then tarred with the same brush by the clients they serve and are trying to attract. Arguably, the concept even becomes irrelevant. The challenge has also come from those local retail banks carving out an offering targeting HNW clients exclusively. They tend to describe what they do as ‘private banking’ because they think the term possesses cachet. Yet while some clients value quality brands, they are not short-sighted or easily fooled. If self-described private banks don’t offer the substance of quality advice and service they claim in their marketing brochures, they are unlikely to retain much client business. Private banking is certainly less ‘private’ these days than it ever used to be. The compliance spotlight that has started to shine ever-brighter in the wake of the 2008 financial crisis and the race among governments to re-fill their coffers is only likely to further sharpen. The allure of ‘secrecy’ which once surrounded private banking is gone, with the most credible institutions going to great lengths to ensure client assets and any new accounts are from legitimate sources and have valid objectives for needing a private bank. At the same time, the drive towards greater fee transparency and the elimination of retrocessions over time should encourage true private banks to reinforce the value of their discretionary offering. The purpose of private banking should be simple: to offer relationship-based advice and tailored financial solutions to meet specific client needs. With HNW clients becoming increasingly global, this advice needs to be offered on an increasingly international basis, and increasingly through digital means. Banks that employ professionals who are dedicated to getting to know their clients, and then meeting their financial needs in a product-agnostic, transparent manner can rightfully point to their credentials as a private bank. And they can demonstrate the differences they offer. Either way, client education has to play a key role. People who think a private banker just processes transaction orders have the wrong understanding. But if they understand what they can and cannot get from their private bank, everyone will benefit.
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Marius Čiuželis on Traditional & Alternative investmentsInvestor / Advisor / Social EntrepreneurSome time ago
Some quotes first: 1. Activist investor Jeff Ubben has left ValueAct Capital, the $16bn hedge fund he founded, to launch a new environmental and social impact investment company. 2. „Companies, as governed today, with investors asking for more current returns and more buybacks and so forth, aren’t working for society or nature,“ he said. „But I have to prove that there’s a return [in long-term impact], because otherwise . . . you’re not really changing anything.“ <..> „Finance is, like, done. Everybody’s bought everybody else with low-cost debt. Everybody’s maximised their margin. They’ve bought all their shares back . . . There’s nothing there. Every industry has about three players.“ 3. Having an impact fund and a traditional fund under the same roof at ValueAct was „confusing“ for investors, Mr Ubben said. Those who opted for the impact vehicle worried they were leaving returns on the table, and those who opted for the flagship fund worried that about being portrayed as environmentally or socially „unconscious“. „I don’t think these two strategies peacefully coexist,“ said Mr Ubben. Second, that was the essence. If RE investments are driven by "location", "location", "location" mantra, then in "ordinary" investing it is not only "return", "return", “return" anymore. I have been following for the last few years already an emerging and quite fast growing trend in hedge funds space to invest if not "for" then at last "with" social and/or environmental impact in mind. And that will benefit all of us. Even those who are far away from investing. https://www.barrons.com/articles/activist-investor-jeff-ubben-departs-valueact-to-focus-on-esg-51592936937
Activist Investor Jeff Ubben Departs ValueAct to Focus on ESG
www.barrons.com

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Marius ČiuželisInvestor / Advisor / Social Entrepreneur
Gabija, ačiū! 👏
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Marius Čiuželis on Traditional & Alternative investmentsInvestor / Advisor / Social EntrepreneurSome time ago
#bitcoin #cryptos #CryptoFunds Yes, you noted it correctly, the post below is on crypto funds. You might start saying cryptos are for dummies, any rational investor should avoid them, they have no any value and it's just a speculative bubble. Pause here for a second. For as long as investors do allocate a portion of their portfolios to crypto currencies, tokens and / or crypto funds it's worth taking a look at the different alternatives and their performance. Last year I invested myself into 1 crypto currency, 1 crypto fund and 1 token directly. Traded few more. A fund employs a long/short strategy and I want to be ready when the recent bubble bursts from it's short side (or gain further if it continues from it's long side). Token is a spicy ingredient in my portfolio with tenfold raise since my first investment in May'20. Cryptocurrency is 1:1 backed by USD and yields 22-26% p.a. with daily payouts. Nothing to compare to 10x over 9 months, but still mind blowing if you compare to ''cash'' yields. What about fund performance then? A fund I'm invested with still has a too short track record to draw any meaningful conclusions. So let's take a look at the whole market. As per Crypto Fund Research, crypto funds were again the hottest investment managers in 2020, gaining more than 160% on the year. However, bitcoin performed significantly better than the CFR Crypto Fund Index, which measures the performance of a basket of 70+ crypto funds. So did crypto hedge funds actually underperform? As in any case where you don't now a quick answer but still want to look smart enough, you say "It depends". So the answer to the last question is ''it depends''. And let me explain why. Crypto hedge funds, as many other funds, are supposed to manage risk in the sometimes extremely volatile markets. As you know, cryptocurrencies and volatility go hand to hand. This typically results in significant outperformance when Bitcoin and other cryptocurrencies decline and underperformance when they rise considerably as they did in 2020. Crypto funds also operate a number of strategies - some strategies like arbitrage are essentially market neutral and will almost always underperform a long-portfolio in bull markets and outperform in bear markets. In fact, since the beginning of 2017 crypto funds have gained 2,812% vs. 2909% for Bitcon (Crypto Fund Research's calculations). Over multiple market cycles, crypto funds have kept pace with Bitcoin's gains. But here's the important part... they've done so with far less volatility than Bitcoin. And this is exactly what all investors hope for. Crypto funds' ability to manage risk was never more clear than during 2018's "crypto winter". While Bitcoin's price fell 75% from its peak. Crypto funds lost less than 50%. While most investors don't cheer a 50% loss, they likely took solice knowing had they been fully exposed to Bitcoin they would have lost far more. Still, crypto funds are a risky investment and most suitable for institutions and sophisticated investors. Thus, have a double or even triple eye when selecting particular fund and stay well invested.

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Mangirdas AdomaitisArtificial inteligence, Data science
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Marius Čiuželis on Traditional & Alternative investmentsInvestor / Advisor / Social EntrepreneurSome time ago
Electric Vehicle Investment Roadmap Summary: - Electric Vehicles (EVs) are an emerging set of technologies with enormous potential to transform transportation. - As such, EV companies represent significant opportunities for investors who can determine when and where to invest in this complex market. - This article provides an investor roadmap to more than two dozen varied investment opportunities. - These opportunities go beyond investing in Tesla, and look at the auto manufacturers, new US start-ups, Chinese EV companies, and supporting industries. - As in all investments, considerations of the companies strategies, valuations, and investment timing are critical; especially with the volatility of these investments. https://seekingalpha-com.cdn.ampproject.org/c/s/seekingalpha.com/amp/article/4380558-electric-vehicle-investment-roadmap
Electric Vehicle Investment Roadmap
seekingalpha-com.cdn.ampproject.org
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