Investing for clients as principal, not an advisor, with a long-term, endowment-like approach
Clients turn to LGT Capital Partners to leverage the experience of a principal investor, not simply an advisor. We bring over 20 years of experience in investing the Princely endowment portfolio for our Firm's shareholder, the Princely Family of Liechtenstein. Our clients often invest alongside into the whole portfolio or into individual components or subsets. When designing customized solutions for our clients we apply the same philosophy and principles we use in managing the Princely endowment.
This means targeting a long-term horizon in order to capture the full range of opportunities that may present themselves. It entails taking a prudent approach to risk, one that includes diversification along the full range of risk and return drivers, with a strong emphasis on alternative asset classes. Liquid alternatives provide a strong diversifying impact, while private market assets enhance returns. Our approach also entails robust risk management, where all investments are fully vetted prior to investment by a seasoned investment committee and independent risk managers. While we make use of the full investment toolbox to drive compelling risk-adjusted returns, we do take a conservative approach to leverage.
Taking this approach on behalf of the Princely endowment has enabled us to achieve sustainable, long-term asset growth with moderate volatility since the portfolio was launched in 1998. Since then it has solidly outperformed public equities. Part of the success of the endowment, which carries over into our work with institutional investors, is the strength of our team approach to investing. We are sceptical of the ability of investment “stars" to deliver compelling, consistent returns over the long term, as we believe success comes from the work of the whole team. We rely on the combined insights of more than 200 asset class investment specialists working across private markets, liquid alternatives and multi-asset topics to design and implement robust portfolios for clients. We also work with a carefully selected stable of external managers, who are specialists in their strategies, to bring additional expertise to the table.
Our endowment heritage also cultivates close alignment with investors, as we face similar investment risks and rewards. The Princely endowment typically invests in the same assets as our clients portfolios, and our team members also invest in them through the Firm's co-investment plan. This helps to further entrench prudent risk taking and strong risk management in the Firm's culture. The approach is also extended to our work with external managers, where their willingness to co-invest in their portfolios is a significant factor in choosing to work with them.