Track record

We have a long track record of producing superior risk-adjusted returns. This has been in part due to consistently identifying managers who outperform their benchmarks.

An illustration of a man doing tai chi

We use our proprietary Factor Model to disaggregate the returns of our potential third-party managers.

  • At Saltus, we harness our bespoke Factor Model to systematically identify managers whose returns can be attributed to skill.
  • We believe manager skill does persist in financial markets, and our investment team is continually searching for managers who demonstrate this. 
  • We look for managers where outperformance has been consistent, to try to ensure the outperformance isn’t down to luck.

We can measure the excess return generated by each manager we use over their benchmark and compare it to the costs of investing with that manager. For our middle risk band portfolio the ‘Saltus MAC Balanced (PA)’ , the results over the last 6 years are summarised in Chart 1 below.

On average, the extra cost of 0.8% per annum for using active managers has been paid for by outperformance of 2.3% per annum. Over the last 6 years, we added 8.7% through using active managers, net of their fees.

An illustration of a man looking through a looking glass

Chart 1: Manager Excess Return vs Cost

Manager Excess Return vs Cost

Source: Bloomberg/Saltus. Full calendar years from 2017 – 2022. Past performance is not a guide to the future. Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested. We measure the gross excess return generated by each manager we use over their benchmark and compare it to the costs of investing with that manager. This is then multiplied by the amount of our portfolio invested with that manager at the start of each month to determine the results.

Chart 1: Manager Excess Return vs Cost

Manager Excess Return vs Cost

Source: Bloomberg/Saltus. Full calendar years from 2017 – 2022. Past performance is not a guide to the future. Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested. We measure the gross excess return generated by each manager we use over their benchmark and compare it to the costs of investing with that manager. This is then multiplied by the amount of our portfolio invested with that manager at the start of each month to determine the results.

Successful active asset allocation alongside effective manager selection is key.

  • If exceptional managers cannot be identified and the exposure to the underlying asset is still desirable, we will use passive funds to implement our decisions.
  • Many of our asset allocation decisions within our core range would not be achievable with passive instruments. Our allocations to some alternative investments and Private Equity, for example, do not have viable passive counterparts.

Chart 2 highlights the years in which positive performance versus competitors was derived from both active asset allocation and manager excess return or ‘skill’. The peer group benchmark is the ARC Private Client Indices. More information on the benchmark can be found at the bottom of the page.

Successful asset allocation and identifying skilled managers led to outperformance of the peer group by 12.9% over the last 6 years.

An illustration of a man spinning a plate

Chart 2: Manager Excess Return and Asset Allocation

Manager Excess Return and Asset Allocation

Source: FE Analytics/Saltus. Full calendar years from 2017 – 2022. Performance is quoted net of third-party manager fees & Saltus DFM Fee. Net Outperformance is shown versus the Balanced ARC PCI benchmark. Asset allocation is calculated as the difference between manager excess return in any given year and the benchmark return for that year. Past performance is not a guide to the future. Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested.

Chart 2: Manager Excess Return and Asset Allocation

Manager Excess Return and Asset Allocation

Source: FE Analytics/Saltus. Full calendar years from 2017 – 2022. Performance is quoted net of third-party manager fees & Saltus DFM Fee. Net Outperformance is shown versus the Balanced ARC PCI benchmark. Asset allocation is calculated as the difference between manager excess return in any given year and the benchmark return for that year. Past performance is not a guide to the future. Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested.

Our approach has produced industry leading risk adjusted returns.

The combination of effective manager selection and nimble unconstrained asset allocation has resulted in outperformance versus our competitors.

Chart 3 provides overall discreet performance for our middle risk band portfolio, the ‘Saltus MAC Balanced (PA)’ portfolio, versus the ARC peer group. This is shown alongside the return on cash over the same period.

The Saltus portfolio achieved a return of almost double the annualised return of our competitor benchmark over a 6 year period.

An illustration of a man on a tight rope

Chart 3: Annual Performance vs ARC

Annual Performance vs ARC

Source: FE Analytics/Saltus. Full calendar years from 2017 – 2022. Performance is quoted net of third-party manager fees and the Saltus DFM Fee. Past performance is not a guide to the future. Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested.

Chart 3: Annual Performance vs ARC

Annual Performance vs ARC

Source: FE Analytics/Saltus. Full calendar years from 2017 – 2022. Performance is quoted net of third-party manager fees and the Saltus DFM Fee. Past performance is not a guide to the future. Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested.

The peer group benchmark is the ARC Private Client Indices.

 

What is the ARC Private Client Indices?

ARC (Asset Risk Consultants) provide an independent benchmark that assesses us against all of our competitors. We have no input on the benchmark and how the data is presented. The Indices are the only market benchmarks composed of real results from real investor accounts—a total of 350,000 investment portfolios from over 140 firms. “The Indices are the definitive guidepost for good investment performance under any condition” – ARC.

 

Who is included in the benchmark?

Nearly every major Wealth Manager in the UK is included in the benchmark. For a list of all the firms included, please click here.

 

Do you need help managing your investments?

Our team can recommend an investment strategy to meet your financial objectives and give you peace of mind that your investments are in good hands. Get in touch to discuss how we can help you.

Request a call back

looking glass illustration
Investments do not guarantee a return, the value and the income from them can fall as well as rise. You may not get back the amount originally invested. Past performance is no guarantee of future returns.
Get in touch