Growing practice the perfect stage for young advisor

Growing practice the perfect stage for young advisor

Growing practice the perfect stage for young advisor

Whether he’s in front of a client or on stage performing Chekhov, Sean Moir believes communication is the key to a positive outcome.

The portfolio manager at Team Moir, Mandeville Private Client Inc. believes that, as in the wider world, problems arise when the conversation breaks down. The 33-year-old counts himself lucky that a lifetime in theatre has fostered good communication skills – not just with fellow thespians but also with clients.

Moir once harboured dreams of making it as a professional actor and studied theatre at Brock University for a while before a remark from his doctor cut to the cold reality of his prospects.

Moir said: “He made a joke that had a morale attached: ‘What’s the difference between a 12-slice pizza and an actor? The pizza can feed a family of four’. I realised that going to school for theatre was very different from actually being in theatre.”

The next step was not so much a Plan B but a reversion to family values. Moir grew up in finance, with his father John running an investment practice that he started in the 1990s.

He said: “I used to vacuum the floors of the office and he’d bring me to all his client appreciation and speaking events. The money I made from my paper route went into mutual funds. I grew up in the world of Canadian equity markets.”

The closing of the professional acting dream door – he still performs regularly in local theatre – prompted the opening of another. In the intervening years, John had sold his book and was kicking his heels in retirement, regretting the fact he’d given up working with individuals to run mutual funds.

The result? They joined forces in a bid to provide continuity between clients of different age groups, marrying the older man’s firebrand passion and creativity with his son’s analytical and calmer nature. Fourteen years later, things have worked out.

Moir explained: “The industry talks a lot about the inter-generational transfer of wealth, but it doesn’t talk about the inter-generational transfer of wealth management or knowledge. That is why we went into business together.

“He was late 50s, I was early 20s; he’s now mid-60s and I’m 33. The clients are comfortable knowing that they have someone with decades of investment experience with John and the decades ahead of them with me. We’re a little different to what’s out there.

“People gravitate towards us because of our respective ages – and then we find a happy medium as well. We probably average clients in the 40s and 50s and we do have a decent millennial portfolio in our book.”

As well as the personal father-and-son selling point, Moir believes the practice can boast other differentiators that appeal to prospective clients.

Mandeville’s approach to alternative investments was a big draw for Team Moir, whose philosophy dovetails with Mandeville’s CEO, Michael Lee-Chin. Both want to duplicate the type of portfolio you would find at the CPP or Ontario Teachers and both are proponents of the Berkshire Hathaway cocktail of public and private investments.

Moir, with an AUM of $40 million and growing, said this approach has resonated with high-net-worth clients and believes there are three main considerations as to why the alternative space can benefit clients. The first is the value of “true” private and alternatives compared to the marketed versions.

He said: “If you are going to invest in a private business, it’s not publicly traded anywhere – no liquidity. You are in on that company and you are in on its future venture, and you are not entirely sure when there will be a liquidity date. With the public market, you’re paying a premium for that liquidity, and it’s sometimes very steep. You could have a public and private company that have similar characteristics, in a comparative field, and you might be able to buy a piece of the private company for 25-40% discount to its public peer. That can translate into meaningful long-term outperformance.

“That’s not for every single investor and the investment allocation needs to be appropriately sized. Because of that I can’t see that being anything other than bespoke.”

The second point Moir makes about alternatives is that you can’t escape volatility and human psychology – but you can make it more palatable. People will always be buying or selling and affecting prices, but investors can change the amount of times you evaluate something and focus more on fundamentals than fund flows or emotional volatility.

Providing the investor doesn’t need to cash it in tomorrow and he/she believes the fundamentals of their underlying investment, the alternative universe can provide true diversification and a dampener to volatility.

Moir said: “Whether we are watching the news or any landing page of a newspaper website, they are always shouting at us about which way the market is going. The nice thing about private investments is that you not so much avoid the volatility, it’s that it’s not waved in your face every single day; it’s maybe every 90 days or 365 days.”

The final attraction in this private trifecta is the consolidation of many big, stable businesses in the 2000s, meaning many are no longer on the market having been swallowed up by private money. Moir points to how long Uber waited to go public and how long Twitter took to go to market as an indication that the public markets are not as alluring as they were in the 1990s, for example.

“Once you go public, you get the winds of quarterly reports and the demands of Wall Street end up running the business,” Moir said. “That’s the advantage of a private enterprise because it can look long term and answer to fewer people, and it doesn’t always have to follow the current. That can only be found in the private atmosphere.”

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