CC-BY-SA-2.0, FlickrJimmy Baikovicius
. Sun Partners
Wealth Manager SunPartners based in Montevideo and Geneva, has recently hired a high performance Private Banker team, coming from Julius Baer Montevideo. “This move is in line with our growth plan for the next 2 years, which will include an expansion to North and Central America” commented Michel Genolet, partner at the Advisory firm. “Sun Partners is well established in Latin America, and the hiring has always been geared towards top producers who share our values, which include maintaining the highest standards of honesty, transparency and professionalism. We are confident that this team will meet and exceed our expectations, which will ultimately add value to our firm” explained Genolet.
The new team, who joined SunPartners on September 2, 2019, includes Gabriela Laurutis and German Lieutier.
Gabriela Laurutis worked as a Financial Consultant at ABN AMRO during 8 years before joining Merrill Lynch in New York in 2000. She moved to Montevideo in 2004 and following the 2013 merger, Gabriela became one of the most successful Financial Advisors at Julius Baer. She holds a degree in Economics and a Masters Degree in Business Administration from Cema University in Buenos Aires.
German Lieutier has been working closely with Gabriela Laurutis for the past 13 years at Merrill Lynch/ Julius Baer in Montevideo. He is a Certified Public Accountant and holds a Masters degree in Finance form the Universidad de Montevideo.
Founded in 2012, SunPartners has $1.2 billion of assets under management. The firms offers Wealth Management services to individuals and families based in Latin America, or with stong interests in the region. The firm employs around 30 individuals, including 10 advisors, and books through firms such as UBS, Pictet and Bolton Global Capital
Foto cedida. Bolton muda sus oficinas de Miami a la Torre Four Seasons
Bolton Global Capital has leased the penthouse office suite in the Four Seasons Hotel Tower on Brickell Avenue in Miami. The firm has acquired the 20,000 square foot space to accommodate its continued growth in Miami. Since opening its office at 801 Brickell Avenue in 2011, the firm has recruited several high-profile teams from the major banks and wirehouses in Miami. These recruits now manage 3.5 billion dollars in client assets on the Bolton platform.
“Expanding our footprint with space at the Four Seasons Tower underscores Bolton’s position as the premium brand in the international wealth management space” according to Bolton’s CEO, Ray Grenier. The location of the Four Seasons Tower at the southern end of Brickell Avenue was also a significant factor in the firm’s decision to relocate with increasing traffic congestion in the downtown and Brickell area near the Miami River. “In addition to reduced commuting times” Grenier stated “our affiliates will have ample parking, gym access and discounts on Four Seasons dining and lodging for clients.”
Growing at an average annual rate of 20 percent over the last 5 years, Bolton is the largest independent broker dealer in the international wealth management space with 8.5 billion dollars in client assets. The boutique firm offers turnkey office solutions for advisors to convert their practices at the major banks to the independent business model where they own their client book and retain most of the revenue. Bolton provides affiliated advisors with furnished office space, computer equipment and technologies as well as back office, branding and compliance support to achieve an efficient transition to independence.
Quentin Ecrepont / Pexels CC0. El sector de fondo de fondos domina en los CERPIs, mientras que en los CKDs los de bienes raíces
The market value of the 111 CKDs and 24 CERPIs in circulation ended July at 13.369 billion dollars and capital calls to be made acount for 11.354 billion dollars. 80% of resources are concentrated by CKDS and 20% by CERPIs.
Although the rise of CERPIs is just over one year old, despite its youth, it is already possible to observe a specialization and tendency in each of the instruments where CKDs have leaned towards the real estate sector (29% share of market in committed amount), while CERPIs by the fund of funds sector (57%). Curiously, in CKDs the fund of funds sector the offer is low (5%), while in CERPIs the offer of real estate alternatives is also low (4%).
It could be said that the Mexican institutional investor has so far preferred to invest in real estate in Mexico through CKDs than to invest in real estate internationally via CERPIs; while international investments in fund of funds call it more attention than in Mexico. It is important to mention that CKDs are private equity investments that are made exclusively in Mexico, while CERPIs investments 90% are made internationally and the rest in Mexico (10%).
In the private equity sector, there is also a specialization since while in the CERPIs it represents a 26% market share in committed amount, being the second most important sector; in the CKD market it reaches 15%, being the third most important sector.
A less concentrated market share can be seen in term of resources committed by sector in the CKDs, as is the case in CERPIs. In CKDs 4 sectors represent 80% (real estate 29%, infrastructure 21%, private equity and energy 15% each), while in the case of CERPIs only two sectors have 83% (fund of funds 57% and private equity 26%).
In the 10 years that the CKDs have been, it can be seen how there are years in which the offer is skewed towards a specific sector. For the real estate sector in 2018, the greatest placement of resources was achieved by committing 1.823 (31%) of the 5.911 million dollars of the sector. For the infrastructure sector, commitments were reached for 1.222 in 2015 (27%) of the 4.469 million dollars the market is worth. For energy it was 2014 (28% of the committed resources of the sector) and for credit it was 2015 (34%).
Between January and July 2019, a total of 4 new CKDs and 5 new CERPIs have been seen that add commitments for 1.707 million dollars, of which 79% of the resources have been for CERPIs dominating the fund of funds raising. As for CKDs, preference for the real estate and infrastructure sector prevails.
Pixabay CC0 Public Domain. invertido_mix_gestoras.jpg
The US yield curve has been reversed again and the United Kingdom is about to do so, which worries investors. According to the main asset managers, the fact that it is invested can indicate that, at best, investors expect the economy to slow down and at worst, that a recession could be on its way.
In the opinion of Keith Wade, chief economist at Schroders, “The US curve is a reliable indicator of recession, the UK curve less so. Nonetheless, if the US goes into recession it is hard for others not to go the same way given its importance as a driver of the world economy. So the double signal is important. There is normally a lag of about one year from inversion to recession so the curves are signalling problems for 2020.”
The same concern is shared by Mark Holman, Chief Executive Officer of Twentyfour AM (Vontobel), who acknowledges that the reversal of the curve is not good news. “In our opinion, the reversal of the yield curve is fully justified given the weight of geopolitical events, and one thing absolutely certain is that an inverted curve is not good news. The only question is how bad this news is and how it could convey and encourage greater economic concern,” he says.
“August doesn’t seem as calm as we would have thought. Tensions continue between the United States and China. The German and Swiss yield curve is in a negative territory, European equity markets continue to live out, while gold continues to rise. On the economic front, recessions in China and Germany are being felt. Although the global economy seems to resist, investors begin to fear that a recession is not far. However, the United States is managing to maintain a solid cycle and the latest figures show an acceleration in consumption. Central bank measures seem to have become the last line of defense to prolong the cycle and alleviate political tensions. However, it is by no means certain that this is sufficient between now and 2020,” says Igor de Maack, fund manager at DNCA, affiliated with Natixis IM.
For Holman, the investment of the curves is explained by the global slowdown that is continuing over time, and that keep markets restless. “A consequence of this is that fixed-income investors increase exposure to risk-free pure assets such as US, German or UK Treasury bonds, but to protect the portfolios they must maintain a duration greater than the normal, which is one of the main catalysts of the curve’s shape. As a result, the curves become lower and flatter, which is perhaps more sinister than higher and flatter returns, ”he explains.
This reading is what alerts the investor, who sees the possibility of a recession as more and more likely. But the managers ask for peace of mind and continue to insist that we are not facing a recession. “While we agree that the risk has increased, a recession over the next year is not yet an inevitable conclusion. Unlike the period prior to other recessions in the past in the US, current financial stability risks appear moderate, balance sheets are solid, family debt is manageable and the personal savings rate is high. All these fundamental factors should help cushion any economic recession,” say Tiffany Wilding, US economist, and Anmol Sinha, fixed income strategist at PIMCO.
The same message came out of the BlackRock Investment Institute (BII) in its weekly report: “We do not believe that the investment in the yield curve is a sign of recession and we believe that the accommodative turn of the central banks is dilating the growth cycle… Assets considered refuge, such as gold, rebounded. We continue to observe limited short-term recession risks, since the accommodative turn of the central banks helps to prolong the economic cycle, although we note that commercial and geopolitical tensions pose fall risks.”
“The reversal of the yield curve does not cause a recession, but it indicates that we are in an advanced phase of the economic cycle. So, instead of considering it a cause for concern, it could be a good time for investors to verify that their portfolios are well diversified and that their fixed-income positions can limit excess risk. In the final stages of the cycle it is especially important to determine whether fixed income positions offer diversification with respect to equities, as well as the appropriate level of balance,” concludes Jeremy Cunningham, Investments Director at Capital Group.
Between February 27-28, 2020 experts and thought-leaders from around the world will gather at the Omni Orlando Resort at ChampionsGate to participate on the INTL FCStone’ Vision 20/20: Global Markets Outlook Conference. There, they will be offered a global vision of the future for more financial and commodity markets, along with detailed market forecasts, insight on the latest technology, and macro-economic outlooks to help you get a clear picture of the factors impacting your bottom line.
The conference, which is sponsored by CME Group and Barchart, will be divided into four tracks with focused programming specific to each area.
The Global Agriculture Outlook track will offer a global view toward developing strategy, protecting profits and driving growth with detailed forecasts based on the latest available data. In addition to essential market outlooks, this event provides invaluable opportunities to make new connections and network with peers.
The Correspondent Clearing Outlook event, sponsored by SDDCo Group, StoneCastle, Mediant and Aberdeen Standard Investments, is an invaluable opportunity for US and international broker-dealers and investment advisors to hear from industry thought-leaders and participate in discussions. Attendees will experience the latest internal and third-party technology and learn more about INTL’s Correspondent Clearing group.
The Dairy Outlook track will offer attendees insights into emerging trends within the industry, along with strategies to protect profits and enable growth in the current environment. In addition to the essential market outlooks and price forecasts, this event provides invaluable opportunities to connect with dairy market experts and make new connections.
The SA Stone Wealth Management event, sponsored by Gladstone Land, is an invaluable opportunity to listen to some of the best speakers and engage with industry experts to learn about how to build and grow your practice. You’ll also have the chance to make new connections and network with peers.
These tracks will combine for a welcome reception, general keynote sessions, meals and a trade show.
Registration will open in the fall. For more information you can contact kari.hennigan@intlfcstone.com
HSBC Global Private Banking, Americas announced that Roberto Teofilo has joined as Managing Director and Senior Relationship Manager for the Brazil market. He will report to George Moscoso, Market Head for Latin America.
“We are thrilled that Roberto has joined HSBC,” said Moscoso, “he is a highly skilled professional who brings great experience over many years meeting the evolving needs of ultra-high net worth individuals and families in Brazil.”
Based in Miami, Teofilo will be responsible for bringing the global resources of HSBC to help ultra-high net worth clients based in Brazil manage, preserve, and grow their wealth.
With a career spanning nearly 20 years, Teofilo has worked at Deutsche Bank, JPMorgan, Merrill Lynch, and Credit Suisse. Earlier in his career, he worked in strategic planning at IBM in New York. He has a Master’s degree from the Thunderbird School of Global Management and earned his undergraduate degree from Auburn University where he graduated summa cum laude and was named the student-athlete of the year in 1995. Before moving to the United States, he participated in several professional tennis tournaments after a successful run in the International Tennis Federation’s Junior Circuits, reaching the top three in Brazil and Top 50 in the World Rankings in 1988.
“Brazil is one of our key markets within Latin America and we look forward to continuing to strengthen our team and our proposition so that we can best serve the needs of ultra-high net worth families and individuals,” added Moscoso. In addition to Brazil, HSBC Global Private Banking’s core markets within Latin America include Mexico, Chile, and Argentina.
The Brazil market team also recently added Cristiane Suzzio, as a Relationship Officer from JP Morgan and Rodrigo Medina, as a Client Service Executive from Banco do Brasil. These additions come after the Bank welcomed Alessandro Merjam and Monica Mavignier as Relationship Managers for the Brazil market team earlier this Summer.
Julius Baer has signed a declaration to support the United Nations (UN) Principles for Responsible Banking making it the first Swiss bank to commit to them. The Bank will formally sign the principles on the occasion of the UN General Assembly in New York in September 2019.
The Principles for Responsible Banking have been developed by the UN Environment Finance Initiative (UNEP FI) and 28 banks from around the world and will be officially launched on 22 September 2019. The Principles set out the banking industry’s role and responsibility in shaping a sustainable future and in aligning the banking sector with the objectives of the UN Sustainable Development Goals and the 2015 Paris Climate Agreement. The principles represent a single framework for the banking industry that aim to embed sustainability across all business areas.
Bernhard Hodler, Chief Executive Officer Julius Baer said: “We are very proud to be the first Swiss bank to commit to the UNEP FI Principles for Responsible Banking. At Julius Baer, we continuously include sustainability practices into our business, meeting a number of notable milestones in our pursuit of long-term value creation for clients, shareholders, and society as a whole. We see our responsibility as encompassing all aspects of sustainability: economic, social, as well as environmental. With our declaration to the Principles for Responsible Banking, we affirm our willingness to assume an active leadership role in sustainable changes.”
CC-BY-SA-2.0, FlickrCEPAL building. FDI Flows to Latin America and the Caribbean Increased by 13.2% in 2018
In contrast to the global trend, foreign direct investment (FDI) flows to Latin America and the Caribbean increased by 13.2% in 2018 compared to 2017, totaling 184.287 million dollars, which reversed five years of falls.
Although the figure reached last year is still below the values recorded during the boom price cycle of raw materials, the Economic Commission for Latin America and the Caribbean (ECLAC) reported in Santiago, Chile that, “when analyzing the different components of FDI, it is observed that the recovery of dynamism in 2018 was not based on the entry of capital contributions, which would be the most representative source of the renewed interest of companies to settle in the countries of the region, but in the growth of the reinvestment of profits and loans between companies”.
The study shows great heterogeneity in national results: In 16 countries there is an increase in entries compared to 2017 and in 15 countries there is a decrease. Most of the growth of FDI in 2018 is explained by the greater investments in Brazil (88.319 million dollars, 48% of the regional total) and Mexico (36.871 million dollars, 20% of the total).
They are followed, in terms of the amount received, Argentina (11,873 million dollars, 3.1% increase over 2017), Colombia (11,352 million dollars, 18% drop), Panama (6,578 million dollars, increase in 36.3%) and Peru (6.488 million dollars, 5.4% drop). Entrances to Chile (6,082 million dollars) grew slightly (3.9%), but, as in 2017, capital flows to the country were clearly below the average of the last decade.
“In an international context of reducing FDI flows and strong competition for investments, national policies should not be aimed at recovering the amounts recorded at the beginning of the decade, but rather attracting more and more FDI that contributes to the formation of capital from knowledge and move towards sustainable production, energy and consumption patterns,” said Alicia Bárcena, ECLAC Executive Secretary.
“The increasing incorporation of a sustainable development approach in the strategic decisions of the main transnational companies in the world is an opportunity to design policies that accompany this paradigm shift,” said the senior official. The outlook for 2019 is not encouraging because of the international context. A drop of up to 5% in FDI inflows is expected, according to the report.
In 2018, FDI in Central America grew 9.4% compared to 2017 due to the momentum of Panama. In the Caribbean, the entries decreased 11.4% due to lower investments in the Dominican Republic (2,535 million dollars, -29%), the main recipient in this subregion.47% of FDI inflows in 2018 corresponded to the manufacturing industry, 35% to services and 17% to natural resources. On the other hand, cross-border merger and acquisition megaoperations were concentrated in Chile and Brazil, in the mining, hydrocarbons and basic services (electricity and water) sectors.
Regarding the behavior of Latin American transnational corporations, known as translatinas, the ECLAC document reports that the outflow of FDI from Latin American countries decreased in 2018 for the fourth consecutive year and reached 37.870 million dollars. 83% of direct investment abroad from Latin America originated in Brazil, Chile, Colombia and Mexico.
Most of the capital that entered the region came from Europe (which has a greater presence in the Southern Cone) and the United States (main investor in Mexico and Central America). China, meanwhile, lost participation in mergers and acquisitions in Latin America and the Caribbean, according to the report Foreign Direct Investment in Latin America and the Caribbean 2019.
Finally, the report indicates that 7.9% of FDI received by Latin America between 2012 and 2016 went to the agrifood chain, especially to the agribusiness sector, a percentage that rises to 15.5% in the case of Uruguay, 14.5 % in Paraguay, 14.4% in Mexico and 11.9% in Argentina. “FDI can contribute to the need for changes in regional agri-food chains to meet the environmental and social challenges of the coming decades,” concludes ECLAC.
Wikimedia CommonsAlberto Fernández. International Markets try to Calibrate Fernández in a Distrust Climate
In the midst of the storm unleashed by the victory of Alberto Fernández in the primary elections in Argentina, which predict a possible return to the power of the Peronists, international managers and analysts try to gauge the situation: what measures will a hypothetical new government take? Will there be default, renegotiation with the IMF, capital control? … And, above all, a key question: Is the Argentine risk sworth it?
Luc D´hooge, Vontobel‘s Head of Emerging Markets Bonds, and his colleague Thierry Larose, Senior Portfolio Manager, have entered fully into the risk analysis that matters most to international investors.Thus, they point out the risks of a Fernández presidency is that the new administration will embark on a left-wing populist agenda that includes (classified by ascending gravity):
A loss of independence from the central bank.
A sudden stop of the Macri economic and social reform agenda
A loss of transparency and credibility in inflation figures.
A reimplementation of capital controls.
A repudiation of the current reserve agreement of the International Monetary Fund (IMF)
A possible restructuring of the external debt.
Therefore, Vontobel analysts ask: Are we now negotiating at an attractive price for the risk we take? “For us, the answer is yes. The current risk premium of the external debt includes a decent remuneration in the event of default, and the current valuations of the local debt are in line with a strong depreciation of the currency along with the imposition of capital controls. In addition, the IMF will not only record a cancellation of its $ 44 billion rescue program. In addition, it makes no sense for a country with a large current account deficit to stop paying its foreign currency debt (especially when that debt is governed by foreign law, for example, debt issued in the United States and the United Kingdom).”
For the manager there is another question: What are the risks of Argentina following Venezuela in an economic abyss? “The answer here is more nuanced. Argentina has a long history of political errors. Macri achieved good things, but all his efforts were ruined by his gradual approach and monetary policy errors of late 2017 and early 2018. In fact, we believe that the new administration will have no choice but to continue with Macri’s policies. However, the problem is that they will try to avoid the most unpopular (for example, labor reform and a strict monetary policy), placing the country on the same wrong path again, the one that failed miserably before,” they say from Vontobel. Luc D´hooge and Thierry Larose explain that investors are waiting for some clarity about Fernández’s economic policies and bet that he adopt a pragmatic stance since “power spreads pragmatism”.
The past weighs and Fernandez is surrounded by a sea of mistrust
Markets are discounting with a 78% probability that Argentina fails to comply with its debt obligations with a Peronist government, Schroders says in a long report.
Pablo Riveroll, director of Latin American equities, said that “if Alberto Fernández is elected, as we expect now, the continuation of political orthodoxy is a significant risk. Although Fernández’s economic plan is still unclear, his popularity is driven primarily by his formula partner, former President Cristina Fernández de Kirchner. Kirchner has been very critical of the agreement with the IMF, the elimination of capital controls and increases in energy tariffs, as well as having several accusations of corruption against him. Alberto Fernández himself also made radical comments during the campaign, including the reestablishment of capital controls and the relaunching of growth through the easing of fiscal and monetary policy. If he tones down these views in the coming months is an open question.”
Riveroll highlights the distrust he creates amongst many investors: “It will take a long time to understand what Fernández’s true policies will be, so for the next 12 months we would expect much greater uncertainty, a deterioration in growth due to the lack of confidence and a reversal of the recent fall in inflation. Given the increase in uncertainty, we expect investors to take into account a higher risk premium and significant downward revisions of the benefits The outlook for Argentina, both for short and medium term, has deteriorated sharply after the primary elections on Sunday and, therefore, the stock market is unattractive as an investment destination.”
James Barrineau, Director of Emerging Markets Debt Relative of Schroders, affirms that “the investors in debt will look for two signs in the short term and in the first place, a response of Fernandez. Although for the most part he remained silent in the period before the primary elections, he said some imprudent things about economic policy. However, as it is the clear favorite now and alleged winner, it has an incentive to try to calm the markets and not attract a renewed atmosphere of crisis from day one. Second, a demonstration of the ability of the central bank to limit currency volatility. A substantial depreciation of 20% or more later could trigger another round of higher inflation and an additional depreciation spiral, and make debt metrics unsustainable in the medium term.”
Opportunities in emerging markets?
Fidelity warns that the result of the Argentine primary could reverse its pro-market policies. Andressa Tezine, senior sovereign debt analyst, says markets will focus on “when and how a potential Fernández-Kirchner government would announce new controversial measures that would reverse Macri’s reforms. Regardless of the timing of the official announcements, the markets will discount this in the price before the October 27 elections. Consequently, investors should be very attentive to the political evolution of the coming months and consider whether they can withstand the associated risks. If concerns about Argentina extend to emerging markets in general, opportunities could be created for agile investors in countries with no connection to this electoral process or its final outcome,” concludes Fidelity.
CC-BY-SA-2.0, FlickrPhoto: CAIA Miami. CAIA Miami To Host an Alternative Investments Educational Event
CAIA Miami prepares an educational event, titled Private Equity / Venture Capital Outlook, which will take place on Wednesday, September 18th.
The event, sponsored by Lloyd Crescendo Advisors, brings together industry professionals to discuss alternative investments market trends and opportunities in the current market environment.
Starting at 5:30 pm, guests will meet at 801 Brickell Avenue to hear from Roque Calleja, BlackRock Head of Alternative Specialists, Yuval Avni, Crescendo Ventures, Israel Tech VC, Nayef Perry, Hamilton Lane and Amy Lawrence, US Trust / Miami Finance Forum.
For more information or registration, follow this link.
