How family offices can make money while making a difference

This week we continue with the family office focus of recent newsletters with a guest feature by Matt Braithwaite and Jack Martin of Wedlake Bell looking at how family offices are increasingly looking for investment opportunities that are both profitable and reflect social values.

The Covid-19 pandemic has proved a catalyst for a resurgence in the value of social capital and the wider role of private wealth in society, with an increased focus on the 'good' that companies are doing.

But as Braithwaite and Martin point out, repositioning portfolios to reflect this increased appetite for ESG, ethical (SRI) and impact investments cannot be treated as a 'tick-box' exercise. "The exercise of sitting down as a family and agreeing a set of shared values can be cathartic," they write. "Armed with a set of agreed values the family office can seek to deploy these across the family's investments."

Cryptocurrency may be the flash new asset class on the block, but new research published this week by Global Palladium Fund, reveals that the vast majority of institutional investors and wealth advisors are keeping faith with an old favourite, gold. Only 5 per cent of those surveyed are forecasting a fall in the price of the precious metal this year, with the reminder predicting an increase of between 3 and 10 per cent or more.

Cash meanwhile continues to be the most popular asset class among UK investors, according to new research commissioned by HYCM, despite returns on many savings accounts failing to keep pace with inflation. Thirty eight per cent of those surveyed plan to put more funds into savings accounts compared to 27 per cent who are looking to invest in shares, and 21 per cent who favour property investing.

The research also reveals that almost 40 per cent of savers have altered their financial and investment strategies as a result of the ongoing pandemic, which fits with the findings of a new study by ITI Capital. Research by the prime brokerage firm reveals that 39 per cent of investors have dramatically reduced their monthly spending to allow them to ramp up the amount available for investments and savings.

Those looking for advice on top performing investment funds could turn to Sanlam's latest half-yearly Income Study, which reviews and monitors the performance of 58 eligible funds in the Investment Association (IA) UK equity income sector over a six-month period. Topping the 'White List' is the Santander Enhanced Income Fund, while laggards on the 'Black list' include the Liontrust Macro Equity Fund, the Schroder Income Fund, Janus Henderson UK Equity Income and Growth, the ASI UK Income Unconstrained fund, HSBC Income and the L&G UK Equity Income fund.

In the HNW sector, a new white paper from BITE Investments makes a strong case for private equity investments, while venture capital firm Beringea has launched the Beringea Estate Planning service, a flexible, discretionary portfolio service which will seek to provide investors with a consistent level of return through investing in private trading companies that are expected to qualify for Business Relief.

"This service builds on Beringea’s successful track record of two decades of managing the ProVen funds and building them into two of the largest VCTs in the UK," says Stuart Veale, Managing Partner at Beringea.

Wealth Adviser

 

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