A breakdown from our May Investment Committee meeting

On 13th May we held our second Investment Committee meeting. We started this committee to oversee and manage the Evolution investment processes. The intention of the Investment Committee is to hear from and monitor our chosen investment managers, and to ensure our research and processes are working well. Following each meeting, we will be producing publications to feed back to our staff and clients to keep you all updated with our progress.

In our second meeting we discussed the new Centralised Investment Process (CIP), which comprises of a list of our top investment managers and funds. Every 6 months we review the whole of the market to ensure our research is up to date with market changes and to evaluate the performance and due diligence of the managers on our panel. Reviewing our CIP every 6 months keeps our process progressive and allows us to make sure we are only working with the best managers for our clients. It also helps us to understand how the managers are making their tactical and thematic decisions. By holding these regular meetings, we are able to hear from our fund managers to discuss their progress and if we feel a manager is perhaps making too many “wrong calls,” we are able to flag this up to make a decision and ensure our client’s do not suffer.

This research is carried out by the paraplanners, Syed and Bethany who report in and collate the information for Andy. They research all our investment propositions to ensure they are still the best solutions to use with our clients, and also consider if anything ‘new’ should be discussed by the investment committee, considered and potentially added to our CIP.

One of the key considerations when we are doing our research is performance, and how for a certain amount of risk, our managers compare against their benchmarks and peers. Another consideration is the ethical research carried out by our fund managers.

Evolution and Brooks Macdonald

We met with Ben Palmer (Investment Director & Head of Responsible Investment), Chris Bishun (Investment Solutions Director) and Justin Woolf (Regional Business Development Director) from Brooks Macdonald to discuss the Evolution responsible investment services, which is our new ethical proposition.

How is the Evolution Brooks Macdonald proposition currently positioned and what makes it sustainable?

Two of the main themes Ben looks at is health & wellbeing, social & environmental where there is a broad allocation of sustainable themes. When researching a company, the analysts at Brooks Macdonald will look at how well the businesses contribute to the following themes: financial inclusion, resource efficient, responsible business, health and wellbeing, cleaner energy, water and waste management and safety. The biggest sector weightings in the Evolution Brooks Macdonald portfolio include technology and industrial companies which tend to do well in mid to long term investments.

What’s happening at this moment?

Ben discussed the main market drivers at the moment are short term factors such as the vaccine rollout, economies re- opening and increased inflation. This in turn has lifted value and cyclical sectors such as traditional energy, travel & leisure as opposed to growth and quality sectors including technology which we saw did well in 2020. They do expect more waves of Covid towards the end of the year, which may show a drive towards the growth and quality sectors which are more likely to survive economic hardship. The Evolution Brooks Macdonald portfolio leans slightly more towards the growth and quality sectors and believe longer term it is the right position to be in.

Looking to the future

The trends that we saw in 2020 are trends that were already in place, however Covid has sped this up and Ben believes new economy solutions and alignment to sustainability targets are two defining factors for a company’s prospects moving forward.
We believe due to the tactical, and thematic explanations being credible, and supporting the growth story of the portfolios, that we are happy and positive with the overall positioning, especially with the Evolution Financial Services agreed lower prices.
If you would like to discuss your investments, please get in touch.