Our Process – Elgin AMC – Boutique Asset Management

From your first inquiry through to the management, support and reporting on your investments, Elgin recognises the fact that there is no one-size-fits-all in today’s investment marketplace. This is why we have designed a specific process to document your profile, analyse your situation and attitude to risk, in order to provide you with the most appropriate solution.

Change is constant, in order to ensure you can adapt to changes in your personal circumstances Elgin provides a seamless facility to move between each of the structures and strategies provided. We will ensure that our clients’ requirements are met in a personalised, timely fashion with full back-office support.

To support each of our programs we have created the “Profiler Pro™” service, offered free of charge, for investors to assess their current profile and appetite for risk. This service, in combination with Elgin’s professional portfolio analysis provides a totally unbiased report on the risk/reward status of your current investments.

Analyse my portfolio

There are many topics for consideration before placing cash in to any investment but these three specific areas need particularly careful scrutiny before we make any recommendation regarding investments of any nature:-

Structure
Strategy
Securities.

Structure

The structure of your investments is crucial to long term success and many factors prevail.

Jurisdiction. Features such as tax efficiency, confidentiality, portability, marital status, nationality and cost should be taken into consideration before committing to anything. There are too many jurisdictions in the world to list – from Switzerland, Luxembourg the British offshore centres of The Isle of Man and Channel Islands to the various Caribbean centres and other such centres. Each has its pros and cons so careful selection now can avoid future issues.

Custodian. Investors should satisfy themselves through their own due-diligence that the institution they entrust their assets to is financially sound in a well regulated environment. Whether you prefer a life insurance company structure (often useful for creating trusts) a bank or an on-line trading system Elgin will always recommend the larger well established organisations that are in regulated areas.

Account. What does the account that holds the assets consist of ? What restrictions apply? Are trust services available? Can it hold the type of assets you want to buy ? What are the fees? A bank for example can offer several different types of account, as can a life insurance company. Elgin will be particularly diligent in this area and ensure you are made fully aware of all terms and conditions regarding fees, commitments and restrictions.

Strategy

Every investment has a strategy. Be it a large portfolio of diversified assets or a stand-alone fund it should have a defined investment strategy with pre-determined parameters and goals.

Risk. Interpreting your appetite and attitude to risk is of paramount importance to us if your expectations are to be met. If you take high risk and it succeeds, all is well – but, if significant falls in value occur always make sure you have sufficient reserves to avoid the need to liquidate at an inopportune time. One investors low risk may be another’s aggressive.

Amount. The size of your investment is irrelevant to us. What is relevant is the percentage the investment represents of your total net worth. The higher the percentage, the greater the risk. A solid rule of thumb is to invest enough to make a meaningful impact on the future value, but not enough to hinder you today.

Time. Simply put, the longer your investment time horizon the better, particularly in equity markets, in order to be able to sit out the inevitable troughs that will occur as time passes. Risk is reduced if the time to sell is dictated by you rather than circumstance so if you plan to save for a property, a child’s education or retirement start as soon as you can. The ‘cost of delay’ can be significant.

Securities

“if it looks too good to be true, it usually is” could not be more applicable than when it comes to investing. Individual security selections that comprise a portfolio is vital – the landscape is littered with ill-informed choices that have ended in disaster. There are literally hundreds of factors that will influence the success of any investment but these are the main headliners. Whether you make your own selections, or opt for us to help you out, the same guidelines apply.

Liquidity. Most retail investors – ‘The men on the street’ never check this most fundamental of issues. If a security has liquidity issues – i.e. it cannot be sold quickly to other buyers – its value and performance become irrelevant. Property , property funds, Student Accommodation and other ‘solid asset’ funds like wine or trees are prime examples. If there are no buyers for whatever reason the exits can become very crowded.

Transparency. Warren Buffet famously said during the .com boom of the late nineties that he did not buy these stocks as he did not understand them. Like complex funds and ‘structured notes’ offered by so many banks they are opaque, difficult to understand and have hidden fees so are best avoided. Our mantra is “We buy what we understand and we understand what we buy”

Value. Buy low, sell high. If only it were that simple but a few checks will give a reasonable assessment whether an asset is either ‘cheap’ (oversold) ‘expensive’ (overbought) or ‘fair value’. Never an exact science but (as Buffet constantly avoids) buying assets that are priced at 140 x their earnings just didn’t add up. He was right.

Q & A

How can you help me manage my investments more effectively?

By aligning our interests with yours. Elgin’s fee-based Service Menu takes a multi-step approach to wealth management and follows a philosophy that reviews an investor’s total financial situation to ensure that their needs, goals and aspirations are both realistic and achievable. Our success is tied to yours: we understand that as long as your expectations are met over the long term you will remain a valued, satisfied client.

How will you manage my enquiry?

Once you decide that you’d like to find out more about us, a Senior Advisor will contact you by e-mail and provide any additional information you request or arrange a telephone session with you. If you already have an idea of what you are looking for, simply complete a Proposal Request to to enable our analysts to offer some suggestions. Our promise is that we will start our discussions, keen to listen, with a blank piece of paper and an open mind.

How do you assess my needs?

In order to fully understand your individual requirements and Risk Profile, we have developed a straightforward investor questionnaire that will help us develop appropriate solutions for you. Part of this process is to give an unbiased assessment of what you already have in place and how it fits with your expectations which we will take into consideration before making any suggestions.

Will you give me options?

Potential solutions will be presented in draft form for you to consider – we acknowledge the fact that most firms make detailed proposals at this point in a bid to ‘sell’ their products. This is where Elgin differs significantly – we offer solutions – not products..

What happens next?

One – five, six and seven if necessary – we will listen to your likes, dislikes, wants and needs until we have a workable, flexible solution whereby we can meet your expectations. From the outset, you’ll have direct access to your own Advisor and we’ll make sure you receive regular communications and progress reports on your investments with us. In addition, you will have full on-line access to view your investments at any time.

How do you accurately interpret my requirements?

To support each of our programs we have created the ProfilerPro™ service, offered free of charge, for investors to assess their current profile and appetite for risk. This service, in combination with Elgin’s professional portfolio analysis provides a totally unbiased report on the risk/reward status of your current investments.

The Investor Questionnaire is comprehensive and will probably take around 20 minutes to complete, for most of our clients this is the first time they have ever documented their true financial status and conducted a risk-assessment on themselves and the assets they currently hold. Please be assured that the information is completely confidential and will only be used to assess your financial status in order to make appropriate suggestions. Most people find it time well spent, even if only for their own records.

Risk Profiler

Risk Profile Assessment

The statements below are designed to help you decide which risk profile describes you best. Note that the risk profile you choose at outset is completely flexible and can be changed at any time. Please do not hesitate to contact us if you have any questions on info@elginamc.com

Risk Profile: Conservative

I do not expect to see my capital reduce in value
I like very low risk even though the potential returns might be conservative
I will be happy if the value of my investment keeps pace with inflation

Risk Profile: Cautious

I will be happy with 10% return when equity markets are up by 50%, and expect a loss of 10% when markets are down 50%
I like low risk even though the potential returns might be conservative
In the medium to long-term I would like to see my portfolio average a return of 4-6%

Risk Profile: Balanced

I will be happy with 15% return when equity markets are up by 50%, and expect a loss of 15% when markets are down 50%
I will accept medium risk to get medium returns
In the medium to long-term I would like to see my portfolio average a return of 6-8%

Risk Profile: Growth

I will be happy with 30% return when equity markets are up by 50%, and expect a loss of 30% when markets are down 50%
I will accept high risk to get potentially high returns
In the medium to long-term I would like to see my portfolio average a return of 8-10%

Risk Profile: Growth Plus

I want to follow the equity markets both on the upside and the downside.
I will accept higher risk to get potentially higher returns
In the medium to long-term I would like to see my portfolio average a return of 10+%

	Cash/Money Market	Fixed Income	Developed Equity	Emerging Equity	Alternatives
Conservative	0-35%	20-70%	0%	0%	0-50%
Cautious	0-35%	40-90%	0-15%	0-15%	0-50%
Balanced	0-40%	20-65%	10-30%	10-30%	10-35%
Growth	0-40%	0-50%	15-45%	15-45%	10-35%
Growth +	0-20%	0-10%	20-60%	20-60%	5-20%
Themes
Absolute Return	0-15%	15-35%	0%	0%	40-80%
Equal Weight	0-5%	25%	12,5%	12,5%	45-50%
Income Builder	0-5%	0-100%	0-100%	0-100%	0%
Best of BRIC’S	0-5%	0%	0%	95-100%	0%

Risk Questionnaire

Every investor is unique with very personal ideas regarding risk – one may view a particular asset as ‘risky’ whilst another may view it as ‘balanced’

As part of our risk profiling process we ask a number of questions to ascertain each investors tolerance for risk and make suggestions accordingly. Please contact us by email info@elginamc.com or even by phone +357 22 41 56 04 so that we can help assess your risk profile.

All enquiries are treated with the strictest confidentiality and your data will not be shared with anyone else

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