Margot Lorenz, Partner in Portas Capital Ltd
Today our interview with Margot Lorenz, Partner in Portas Capital Ltd, Zurich based top ranking Asset Management.
Is this a correct statement: you „believe“ in an asset class.
Must a client go after his intuition ?
Generally speaking, you should only invest in asset classes which you are familiar with. However, this is different from believing in and investing exclusively in one asset class.
Long-term and steady wealth accumulation – in addition to a professional/entrepreneurial career – is possible through a diversified investment strategy across different asset classes such as shares, real estate, commodities, etc. The earlier you start, the more you can take risks and therefore achieve higher profits in the long term.
Do you believe that an asset management is an upgrade over a regular portfolio management or advisory within a swiss bank and why?
If you have a passion for investments, the relevant know-how and enough time to manage your finances alongside your job and everyday life, you don’t need an investment advisor. If one or more conditions are not fulfilled, you should consult an expert for assistance. In order to find the right financial offer among millions of possibilities, you should preferably look for an independent advisor.
Banks in particular cannot give independent advice, although they like to claim that they can. First of all, banks have a huge block of costs to bear for e.g. front office staff, back office, research, HR, compliance, etc. Profits should also increase steadily. A bank achieves income, for example, by issuing its own funds or certificates. These are also often used in the bank’s own mandates. In this constellation, a bank has already earned 1.5% – 2.5% before the client starts to see a performance.
Therefore, I can only advise every client to have a trustworthy and independent advisor at his side to find his way through the “jungle” of finances.
What is this, that makes Portas Capital Ltd. special?
As an owner-operated asset manager with a multi-family office approach, our core business is independent asset management and investment consultation for discerning clients. We have been successfully providing our clients with valuable private and institutional asset management for the last 12 years. We handle portfolios entrusted to us and family office services with the utmost care and expertise. As a regulated asset manager, Portas Capital AG belongs to an exclusive network of bank-independent asset managers in Switzerland. Being bank-independent we are not subject to misconceived incentives, incomprehensible management decisions or sales targets. All partners at Portas Capital AG gained experience in private banking at renowned institutions. As a company, we are comitted to the tradition of the (formerly) owner-operated private banks. The individual goals and priorities of our clients are always at the heart of our investment strategies. Our clients enjoy the advantages of an efficient and secure safe deposit with a pure depositary bank, a fair fixed fee (without hidden costs), as well as skilled, active and independent consultation and /or asset management with a gratifying performance record. For the 6th time in a row, we were honoured to receive the Elitereport/ Handelsblatt Award in the category “Successful support of wealthy families” in 2021.
Who are your clients ?
We consider ourselves very fortunate to have a very diversified clientele among our valued customers. In addition to grown family fortunes, self-made millionaires and billionaires, charitable foundations, pension funds and corporates, we are equally committed to serving clients who are only at the beginning of their passive wealth accumulation.
Which services do you focus at the most ?
Our main service is liquid asset management. Our clients’ portfolios consist of equities, bonds, ETFs, commodities, precious metals and, to a small extent, actively managed funds.
What is long term today? Do you believe in a classical asset management approach, as we know it from the studies 20 years back etc or it is outdated for now, and now we say – 5 years is actually a new long term and 3 is midterm and all shorter than 1 is short term.
Longterm is still longterm today and we are convinced of the classic asset management approach. For example, we recommend a client with a balanced risk profile to allocate his equity investments according to the 80%/20% idea. 80% so-called “moat stocks”. These are companies with a long and successful history, promising business model, very good capitalisation and, in the best case, regular distributions to their shareholders. Shares such as Nestle, Roche, L’Oreal, Alphabet, Microsoft.
We invest the remaining 20% in promising growth companies that have the potential to sustainably lift our world to another level. These include topics such as the Internet of Things, Big Data, Renewable Energies and Waste Reduction.
Here, the long-term approach is indeed outdated. Younger companies first have to prove whether they can achieve their ambitious goals. Often they have high debts and are only in the black in a few years. This means that one or the other company has to be replaced in the short/medium term.
What asset class you like over the other and for what reason?
Personally, I prefer shares. With shares you achieve higher returns than with other asset classes. On average 8% – 10%. With a return of 10% per year, the capital invested doubles approx. every 7-8 years.
Diversification – is this a wise principle and right over all other principles
Or is there a solid argument when we choose concentration or high conviction and overweight one asset class or one currency or one region?
The answer depends on your personal risk profile. In retrospect, for example, everyone should have invested all their assets in Tesla shares on 29.10.2010. (IPO) In the meantime, 17 USD became 5000 USD (stock split 2020). If you had invested 100,000 USD, a fortune of 30 million USD would have developed. Over the years, however, one had to endure great volatility and it was often said that it was doomed to fail. So you would have needed nerves of steel if your entire fortune had been invested in this one share.
What I mean to say is, that your investments should be geared to your risk appetite. From my own experience, I can say that you sleep better when you have several irons in the fire.
I would like you to choose a message to be brought to the audience about anything you find important to consider while investing, or instrument to introduce, or common mistake, which you see and want to warn to avoid, or any piece of advise as a blessing for successful investments – what would it be, share it with us please
Keep in mind, shares always rise in the long term. Stock market corrections are buying opportunities. Adjust your portfolio according to your personal risk profile. Don’t look at it every day. If you don’t have the time or knowledge to manage your assets yourself, find a reliable advisor. Keep an eye on costs. The larger your wealth, the more diversified your investments should be. Invest in real assets, assets that will still be there after inflation.
I would like to end with a piece of stock market wisdom by André Kostolany:
“In the stock market, 2 times 2 is never 4 but 5 minus 1. You have to have the nerve to endure minus 1”.