Simon Ibbetson, a veteran asset consultant who has built businesses from the ground up and also worked within major organisations, has launched a new advisory targeting smaller institutions and financial planning dealer groups.
Ibbetson and business partner Veronica Klaus launched 358Australia on February 1 and have so far attracted two dealer group clients, for whom they build model portfolios and approved product lists on a standalone fee basis, and some small non-superannuation institutions.
These investors approached Ibbetson after he left CPG Research and Advisory in November 2010.
358Australia provides broad investment advice and researches domestic and international managers, but favours boutiques and mid-sized businesses whose principals “have some skin in the game” and are therefore more likely to have greater alignment with their clients.
Ibbetson said it was becoming increasingly difficult for large-cap Australian equities managers with plenty of funds under management to add significant value – unless they built highly concentrated portfolios.
“When managers get really big, the restrictions placed on their portfolios are based on business risk, not clients’ needs. That’s why we like smaller managers where principals own the business and have a lot of their own net worth in the business.
“I know clients think it’s very secure to be in a big fund, but you’re giving away a hell of a lot of alpha for that security.”
In the late 1990ss, Ibbetson built Aon Consulting into a business with about 45 corporate super fund clients. He then developed research house Assirt, where he first hired Klaus seven years ago, and sold this business to Standard & Poor’s, where we worked in a consulting role for a few years.
Ibbetson then joined Grove Research & Advisory, which in 2010 became an implemented consulting platform, CPG Research & Advisory, when it was bought by Graham Morrow’s Sigma Alpha International and the WA Local Government Super Plan.
Ibbetson left Morrow’s firm in November and was replaced by the former investments boss at United Funds Management, Jake Jodlowski.
358Australia is named after the Fibonacci numbers, published by Leonardo of Pisa in the 13th century, which are used at trading desks today.