Alex Montgomery

Alex talks about our approach to managing clients' investments.

Hello. My name is Alex Montgomery, and I am a partner of Turcan Connell with particular responsibilities of leading the Investment Management team. The purpose of this short podcast is to tell you about our Investment Management business.

First, I'd like to give you a brief outline of the Investment Team at Turcan Connell. We have ten experienced managers and three trainees. The managers have a whole range of experience. Obviously we have private client experience, but we also have experience of institutional investment management, analysis, corporate broking, and corporate finance. We actively manage assets of five hundred million pounds for our clients, which include individuals, trusts, pension funds, and charities. Our clients are largely UK based, but we do have a number of overseas clients. We also manage two Open Ended Investment Company (OEIC) funds; a balanced fund and an income fund. These are both multi asset funds and have built up very strong performance records over the past three years. In addition, we manage a rapidly growing number of highly tax-efficient portfolios invested in companies quoted on the Alternative Investment Market, which is often known as AIM.

So what differentiates our team from other investment teams? Well, I think there are a number of key points here. Firstly is the way the Investment Team integrates with the rest of Turcan Connell, with a particular focus on joining up our services, where relevant, to provide an integrated package to suit each client. A good example of this is Self Invested Personal Pensions (SIPPs). Our Investment and Financial Planning teams combine to provide proactive pensions advice as well as portfolio management, and joined up reporting to a rapidly growing number of clients. For many of our clients or client families we run a number of portfolios, perhaps including individual portfolios with PEPPs and ISAs, but also extending to trusts, SIPPs, and perhaps a charitable foundation.

We take an overall top-down view in looking at the whole span of portfolios for clients, but ensure that each portfolio is positioned to make effective use of its tax treatment, and to reflect its specific investment objectives. We have been very careful to restrict the ratio of clients per manager to ensure that each of our investment managers is able to provide a proactive personal service to each client.

The investment management team works in three groups for the client-facing element of our work, but for investment research and analysis we all come together. We don't just look at equity investment, but cover a whole range of asset classes, so we cover equities, bonds, commercial property and private equity as well as the area now called alternatives which now include structured vehicles and hedge funds. For example, my research role has been to cover the private equity sector and to guide the whole team on how we should approach it. The specialist area of AIM investment is one where we have some expert input from Northern Venture Managers.

I'd like to move on just to talk about tax for a little while; it's at the front of everyone's mind, and it is hugely important. It's often said that there are two certain things: death and taxes. It's probably not so well appreciated that tax can have a really corrosive negative impact on investment returns. To mitigate this, we work very hard for each client to consider how best to use their tax allowances and exemptions as well as the appropriate tax-efficient investment and savings vehicles. Most basically, we make effective use of capital gains tax allowances for clients every year and mix and match these between husband and wife. We also, in most cases, make full use of the individual savings account or ISA allowance to steadily build up a tax free portfolio for clients as part of their wider investments. We work very closely with our tax and financial planning colleagues to build in other structures for clients, such as SIPPs, offshore bond wrappers and AIM portfolios.

So with tax in mind, how important is it to keep up to date with issues like the budget? Well, this really is a fundamentally important point, not just for our investment team, but for our legal tax and financial planning teams too. A very large proportion of Turcan Connell's business involves asset protection and asset management in their broadest senses, and a key element of our reputation is the depth and quality of our knowledge of UK tax and its evolving impact on our clients.

The recent budget brought significant changes and reinforced other points. The Venture Capital Trust (VCT) and Enterprise Investment Scheme rules are now so heavily restricted that these vehicles have little or no appeal. We are very pleased that investment in qualifying AIM listed companies will continue to attract Inheritance Tax relief after two years as well as retaining their favourable Capital Gains Tax treatment. The government's position on the tax treatment of SIPPs on death has been clarified. As a result we are revising the investment strategy of many client's SIPP portfolios.

So in a nutshell, what makes our investment team stand out? One of the most important differentiators is the unusual range of experience within our team. Also, our very strongly team-based approach to investment research and portfolio management is quite unusual, and helps us to deliver consistent strong investment performance for our clients. We are much more than portfolio managers, working together with other specialists across the firm to deliver an overall service that is tailored to suit each client's personal or very often family circumstances.

Find out more about trust and tax.