As part of our (Lunch) time is money investment series, yesterday I had the pleasure of interviewing Brian Huerta, Portfolio Manager from WCM Global Investment Management. Such a great conversation with lots to share.
WCM is a California based investment management firm specialising in active global and emerging market equities, managing assets of A$85 billion.
Since adding WCM to our approved investment list in 2017, as part of their international investment allocation, we’ve been drawn to their somewhat unique company research process. Equally, we have been very impressed with their own corporate culture, which they attribute to their own success over the years.
Aside from qualitative analysis (the numbers), WCM bury their heads deep under the bonnet to assess the health of the culture within a business before they invest client money.
Ultimately, businesses are nothing without their people. As much as one could be led to believe that ‘people’ are increasingly being replaced by technology, let’s not forget technology is created by humans.
WCM want to invest in companies with a growing moat. In company terms, a ‘moat’ is the competitive gap between a company and its competitors.
Having a moat today is important, but it’s likely that any existing competitive advantage is already factored into the current value. A growing moat ensures that fundamentally the company value will grow into the future.
To succeed in the future, WCM believes that a company must not only have the right people today but also incorporate a strong positive culture that will keep their people long term.
WCM look for a culture of innovation, employee incentives (how a company cares for their staff) and a flat power structure that fosters meritocracy and debate. Interestingly, WCM focuses on these attributes within their own business to improve staff retention and high performance. After all, you need to practice what you preach!
Brian explained that at some point every company will experience a rough patch, but the key to addressing most issues is having a strong positive organisational culture that can demonstrate a strong resolve and resilience to see them through to calmer waters.
Hewison Private Wealth (HPW) believes that diversification is the key to any successful investment strategy. WCM applies a unique research methodology when assessing investment opportunities which compliment many other international investments on our recommended list.
At an individual client level, HPW advisers determine the appropriateness of international investments within a portfolio which ultimately depends on a client’s personal objectives.
At HPW, we focus on fostering our own strong, positive culture. It’s been the key to our success (measured by happy staff and happy clients) to date. Naturally, the WCM strategy resonates with us and since launching in Australia in 2017, they have returned around 22% per annum. If you would like to watch a recording of yesterday's conversation you can watch it HERE.
Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email firstname.lastname@example.org or visit www.hewison.com.au
Please note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.