Discovery Group has launched Cogence, a discretionary fund manager (DFM), to provide investment solutions for local investors.<\/p>\n
The new DFM is in partnership with the world’s biggest asset management firm, BlackRock. It aims to help financial advisers try to realise improved investment outcomes for their clients by looking into clients’ health and Vitality profiles.<\/p>\n
Adrian Gore, Discovery Group Chief Executive, said the impetus behind entering the DFM space is based on two distinct areas that have been disrupted.<\/p>\n
\u201cFirstly, investment markets are more sophisticated and complex than ever. At the same time, we\u2019re seeing local investors increasingly looking to invest more globally.”<\/p>\n
For South Africans, it\u2019s been hard to do so, but with the recent regulatory changes, pension funds and mutual funds are now able to invest up to 45% in offshore assets, said Gore.<\/p>\n
This means we can invest nearly half of our retirement savings in offshore assets, and research and understanding of risks and the opportunities that global markets present is crucial.<\/p>\n
\u201cSecondly, more than 90% of people in South Africa can\u2019t afford retirement, relying on their family or state, and often the elasticity of savings behaviours is more important than investment returns.”<\/p>\n
Cogence is built on BlackRock\u2019s asset allocation views and has been designed to pair Aladdin Wealth’s technology with Vitality\u2019s data and analytics to incorporate personalised health and longevity metrics, which essentially map out every aspect of a financial plan, said Discovery.<\/p>\n
According to Gore, BlackRock’s asset allocations have been designed to pair Aladdin Wealth technology with Vitality’s data and analytics to incorporate personalised health and longevity metrics that aim to map out a financial plan<\/strong>.<\/p>\n “These metrics consider how long you will live, how healthy you will be, how much money you need and importantly, supports financial advisors in making recommendations to their clients,\u201d said Gore.<\/p>\n Kenny Rabson, CEO of Discovery Invest, said, \u201cNavigating financial planning for the future is multi-dimensional and is compounded by complexities and difficulties. The ability to use technology to model the impact that these factors will have on retirement provision is becoming vital, and investors need global expertise with local applicability.\u201d<\/p>\n Through Cogence, financial advisers can gain a full and unique picture of their client’s investments along with access to a wide range of sophisticated analytical tools, such as portfolio stress testing.<\/p>\n Discovery said these tools aim to provide a better understanding of the drivers of risk in a client\u2019s portfolio, thereby enabling the advisor to make more informed investment decisions.<\/p>\n \u201dOur combined behavioural science and global investment expertise will support local financial advisers to deliver more timely information, deeper insights, and superior service to clients that can ultimately result in an optimal retirement outcome,” said Gore.<\/p>\n With lifespans extending, clients need the financial means to retire comfortably and drawdown at a sustainable income level; and most importantly, also good health to ensure they can enjoy it, said Gore.<\/p>\n
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