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A new boutique investment firm with exceptional customisation capabilities has just been launched. Spun out of the private client division of Cannon Asset Managers, private client share portfolio business BayHill Capital has the flexibility to customise the shares it purchases on a client-by-client basis, allowing it to build unique and exciting client offerings. BayHill Capital is part of the Peregrine Holdings Group.
“The capacity we have built in BayHill Capital means will be able to breathe life into ‘neglected’ stockbroker portfolios,” says Geoff Blount, MD of BayHill Capital. “A key competitive advantage is our team’s deep knowledge and skill in the small mid-cap market, as well as our strong ability in the use of contracts for difference (CFDs).”
Joining Blount at BayHill Capital are portfolio managers Victor von Reiche and Daniël Spoormaker, and client managers Craig Simpkins, Andrew Newell and Doug Turvey. Backed by two equity traders, the team has 80 years’ experience in the investment field and manages over R1bn of client portfolios, contributing to the R102bn of assets managed in the Peregrine Group.
Tackling “neglected portfolios”
Many investors with stockbroker accounts too often end up with “neglected” share portfolios. Their brokers may phone them infrequently to discuss investment ideas or they may rely on online execution, where typically no advice is given. Investors often don’t have the time to give their portfolio the due care and attention it needs and deserves, yet they are uncomfortable with handing over the control of the portfolio to someone else.
To address this need, BayHill has created the Co-Pilot Portfolio offering, where the investment manager co-manages the share portfolio with the client. The Co-Pilot Portfolio has the advantage of being professionally managed with oversight and monitoring by BayHill, coupled with a high level of engagement with the client regarding what goes in, and very importantly, out of the portfolio.
Private investors often identify good ideas for inclusion into their portfolio, but often have difficulty deciding when to sell. The Co-Piloted Portfolio will aim to target longer holding periods for long-term capital growth, ensuring that the manager works with clients to seek out valuable gems in the market for both local and offshore share portfolios.
Opportunistic trading, if desired
“Spice” is not usually a word you’d apply to building a private client share portfolios, but BayHill is able to further tailor its offerings for clients who want some excitement and wish to have a more aggressive strategy for their share portfolios, or at least for a portion of their equity exposure.
“The Active Equity Portfolio targets short-term trading opportunities presented by the market which may last anywhere from one day to one year,” explains Blount. “We also use CFDs in the Active Equity Portfolio which also allows BayHill to short a share and profit from its fall, as well as enter into pair trades where one share is bought and another shorted against it. But CFDs are used in a highly risk-controlled manner, with a target of adding value to each client portfolio every month, irrespective market direction.”
Private share portfolio
While the company may be innovative in its approach to investing, BayHill also builds traditional private share portfolios where a pre-agreed strategy is put in place for a client, with full discretion to manage the portfolio and implement the strategy.
To round the offering off, BayHill manages good, old fashioned non-discretionary accounts where instructions are taken from clients on what to buy and sell. Recognising the complexities inherent in today’s markets BayHill does, however, provide investment tools and trade idea notes to assist clients in making these decisions.
“We are excited about the potential for BayHill Capital,” concludes Blount. “Every client has unique needs and requirements and we will be able to satisfy all of these with our bespoke portfolios.”
“At Peregrine Holdings, we believe that BayHill Capital expands our offerings into our wealth management business segment,” adds Jonathan Hertz, Peregrine Holdings CEO. “This will add the new element of direct private client share portfolio management, to complement our already broad private client offering.”