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Firm profile: BACCI Investment Solutions

‘We’re not in the product sales game’

Firm profile: BACCI Investment Solutions

This week BACCI Investment Solutions announced that it had launched a Ucits-compliant global equity fund in Ireland. The strategy will be available on the Prescient Global Funds Icav platform.

The Cape Town-based financial services firm already had two local fund offerings, co-branded with Sanne. The BACCI SNN Protected Equity QI hedge fund was launched in 2010 and currently has R48m in AUM. The BACCI SNN Equity fund was launched last year, and currently has AUM of R105m.

Warren Quin, a director at BACCI, told Citywire that these solutions have been put together as the firm has evolved.

Growth

‘The business has been around for close on 18 years,’ said Quin. ‘It originally started out as a South African stockbroking solution, primarily focused on local equities.

‘But the business slowly started to evolve into a more complete solution where we could offer advice across the spectrum,’ said Quin. ‘The team has grown and I think what we are trying to do is make sure we can offer a very sophisticated service to a specific type of client, but a very personal type of service. We want to work with clients that actually require our advice.

‘We have all come from a corporate world where there is a profit incentive to sell product, but we try to replicate investment that have worked for ourselves, and try to be as transparent as possible,’ said Quin. ‘That is something we think the industry is sorely lacking.’

BACCI is not prescriptive about how much a client needs in order to be taken on board, but its philosophy tends to attract larger balance sheets.

‘We ideally want to identify clients that require a more sophisticated level of service and advice, and want to work closely with someone prepared to do that,’ said Quin. ‘We are not in a product sales game. We don’t want to be out there in the retail market selling a unit trust. We want to work closely with people across their balance sheets’

‘Typically, the minimum portfolio we tend to manage is in excess of R5m, and we manage anything up to the family office size. We don’t want to be too prescriptive. Ultimately if there is a long-term prospect of someone growing their balance sheet we are happy to look at it.’

Global fund

The firm has run money globally for some time in segregated portfolios, and the newly-launched Ucits fund will follow the same investment strategy with greater efficiency.

‘When a business has reached a certain size, running an endless number of segregated portfolios starts to become a bit cumbersome,’ said Quin. ‘So the fund offers a point of efficiency.

‘For clients sitting offshore it’s almost impossible to run a segregated portfolio for less than $200,000. The fund allows us to replicate the global equity strategy for clients with less than that.’

Having established a track record with a global strategy, BACCI can also now advise clients into this solution confident that it has merit.

‘Having come from corporates that tend to focus too much on creating a number of products that can cover any type of investment styles, I think it becomes quite confusing for the investor,’ said Quin. ‘They end up with a suite of offerings and don’t quite understand the differences between them, which can lead to varied results. It’s difficult to manage emotions where your client has been in a value strategy that has under-performed for 10 years, for instance.

‘Our clients are long term in nature, but we also want to make sure that they are progressing on a medium-term basis in line with markets around the world.’

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