| Biography Nadir assumed the role of head of Investment Consulting Strategy at Alexforbes in October 2022, overseeing the research and best practice division. His expertise covers various areas, including formulating default investment strategies and adapting to legislative changes affecting investment strategies. Nadir’s insights assist advisors in optimising the use of different investment products for both mandatory and optional investments. His work in developing investment frameworks and solutions has established him as an integral member of the Investment Solutions Discretionary Fund Management team at Alexforbes, facilitating the integration of best investment practices into advisory services. |
What makes your business distinctive?
Leveraging South Africa’s largest multi-manager platform allows us to truly implement the most flexible model in working with clients in a way that suits them best. This ranges from completely outsourced investment management and market access for clients with a lower risk budget all the way to a highly customised bespoke investment strategy and research design for a large IFA or wealth manager with complex needs for their client base. The second element which differentiates our DFM materially is tapping into a truly independent global manager research partner of scale.
Who is your ideal client?
Investment Solutions by Alexforbes’ flexible business model enables clients to tap into the time, resources and expertise they need from us. While we have seen significant appetite for larger, custom-built investment strategies suited to specific IFA practices, our houseview model portfolio and unit trust strategies have all been exceptional top-quartile performers offering credible outsourced CIO solutions to IFA practices looking to delegate non-core functions and focus on the business of financial advice.
Who are not your clients?
Clients that require bespoke solutions to be built with assets that are subscale and do not offer sufficient economies of scale to construct such desired bespoke solutions in a scalable and efficient manner.
What role do you believe DFMs play in improving client outcomes?
DFMs should improve client outcomes across the following factors:
- Provide more time for IFAs to focus on where their effort is best spent – providing financial advice. By focusing on where
they are most productive, they would compound the positive impact on their clients’ financial journey. - Improve investment outcomes through focused and scalable investment research as well as portfolio construction. A DFM should have greater depth of investment research resources focused solely on this task.
- A DFM should have the capability and insight to advise their IFA practices on how to run a more efficient, scalable and profitable practice through leveraging adviser impact reporting and best practice thinking.
- A DFM should be able to use scale to negotiate more competitive asset management fees from underlying asset managers utilised within a solution.
Some argue DFMs are just another layer of costs for clients. Your response?
One should consider value as opposed to just costs. Should a DFM achieve its intended outcomes of greater practice efficiency, enabling advice to be provided at scale to more members of the public by freeing up advisers’ time and improving performance outcomes on a net of fee basis, you have an entire retail investment industry that is better off for it.
Some have the view that DFMs should have performance tables like fund managers. Your perspective?
One of the challenges of the DFM industry overall is a lack of ubiquitous performance transparency as we so readily have within the unit trust industry. Greater performance transparency promotes sustainability, accountability and adopting an evidence and data driven approach to measuring enhanced client outcomes.
What are the biggest challenges you see facing DFMs in the next decade?
As the industry continues to grow and increase its presence in the retail market, regulation would need to keep up with the rate of innovation happening within the sector. Examples of this include gaining exposure to alternative asset classes and clearer standards for performance measurement and accountability with regards to model portfolios. However, regulations such as RDR and COFI have addressed several nascent retail market concerns.
