BSI’s holistic approach to selection

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Swiss bank BSI looks for virtues such as consistent behaviour and patient stock selection, explains Luca De Biasi, vice president and head of multi-management and fund selection.

Coherence in investment behaviour, patience in selecting stocks and an openness to admit and learn from mistakes. These are the top attributes according to which Luca De Biasi (pictured), senior vice-president and head of the multi-management and fund selection unit at Swiss bank BSI in Lugano, selects portfolio managers.

“We take an holistic approach when selecting managers,” De Biasi says. “I choose experienced and skilled management teams in terms of personality,

unconventionality and way of thinking. Transparency in portfolio activity and communication and consistency of returns in absolute terms, relative to the benchmark, peer group, and adjusted for risk are also very important.”

De Biasi joined the Swiss group in 2007 from Effegestioni, the asset management company of Fondiaria-Sai, where he was senior portfolio manager and head of multi-manager funds.

At BSI, he is responsible for the management of funds Income and Balance profiles, Global Themes, US equities and Absolute return. He also runs the BSI Multinvest Income Euro fund which, despite the current economic climate, has delivered a 5.75% performance as of 20 June.

“We have been one of the first banks to launch a multi-manager product with an absolute return approach. In 2012, we have also launched a Private Banking service where we select the best Ucits funds with daily liquidity for different absolute return categories,” he says.

Fund selection at the bank is divided into two teams: “The first in the relative return space and the second in the absolute return environment,” he explains.

The relative return team manages the ‘Best in class’ list, which selects the best funds in 54 different categories. “About 100 funds are on this list and the investment universe from where we select includes about 10,000 funds. In 2010, we have created a similar list for our branch in Asia. The ‘Best in class’ for our Asian clients includes about 31 funds in 24 categories” De Biasi says.

In the absolute return space, in January BSI launched an absolute ‘Best in class’ list, which features most of the funds included in BSI’s absolute daily product. A separate team also manages the fund of funds, and takes care of trading activities.

Fund selection at the bank follows a strict due diligence process based on qualitative and quantitative metrics, De Biasi explains. The ‘Best in class’ list represents the approved lists for the whole bank. According to De Biasi, it is important to centralise third-party funds analysis.

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