Head of Fixed Income at Vontobel explains why it's bringing EM offering to Canadian investors
Last November, Vontobel Asset Management, a global active manager, announced it was making its emerging-market fixed income capabilities available to Canadian investors.
While Vontobel has had a presence in Canada for some time, the launch two months ago represented the first time the firm offered access to its three emerging-market fixed-income strategies – the Emerging Markets Debt Strategy, Emerging Markets Corporate Bond Strategy, and Emerging Markets Blend Strategy – in the country.
“Vontobel Asset Management has a multi-boutique structure; we have boutiques located in Zurich, in London, and also in New York,” says Victor Schraner, relationship manager and director, Institutional Clients, at Vontobel.
“Historically in this part of the world, we’ve been known for the quality growth equity boutique since it was the only one that was founded, headquartered, and present here.”
That began to change that over the last several years. As Schraner explains, Vontobel introduced the capabilities of TwentyFour Asset Management, its London-based global fixed-income manager, for the first time to the North American marketplace over three years ago. The debut of Vontobel’s emerging-market fixed-income offerings in Canada, he says, represented the next step in its efforts to make the most interesting strategies available this side of the pond.
For Simon Lue-Fong, head of Vontobel Asset Management’s fixed-income boutique, or FIB, that was a crucial milestone. “The U.S. and Canadian markets probably represent the highest bar for investment managers,” he says. “Throughout my career, we’ve heard it said that if you can make it here, you can make it anywhere.”
From a business offering public funds, Vontobel has steadily built up its assets, track record, and bench over the course of 10 years. Today, the firm stands as a successful example of a European asset manager that’s carved out a particular expertise in making bespoke solutions available to institutions.
“We have a 12-person emerging market team led by Luc D’hooge, a seasoned veteran with 32 years of experience,” Lue-Fong says. “His deputy is Wouter Van Overfelt, who has 19 years of experience. Then we have Thierry Larose and Carl Vermassen, who have 31 and 28 years of experience, respectively.”
The rest of the team includes specialists and junior analysts, some working in Zurich and others in Hong Kong. That bench strength, Lue-Fong says, has allowed Vontobel to establish itself as one of the biggest global players in the EM fixed-income game.
“Within our EM business, we have several different strategies,” he says. “All those strategies have posted first-quartile performance or higher. To get more granular about it, all but one of those strategies were first-decile performers, while the last one made the cut for first quartile.”
Beyond just performance, the EM business also shows a history of performance persistence. According to Lue-Fong, the strategies have been able to maintain their record of outperforming both their benchmarks and their competition since inception.
“If we were able to show three or five years of outperformance, which are still good, people will still push back on that a bit,” he says. “But when you’ve been going close to 10 years and have a lot more data points people can judge you on, it speaks to the evolution and maturity of our business, and it allows us to now have that confidence to go forward into the best market in the world.”
