Pie Funds is set to launch a wealth advisory arm after snaring former Westpac financial planner, Simon Hepple, to head the venture.
Mike Taylor, Pie chief, said another adviser was slated to join the Auckland-based Hepple in a few weeks as the wealth management operation goes live.
Taylor said wealth management would be a complementary service for the approximately $730 million boutique fund manager.
“We want to have a full offering,” he said. “Wealth management will also enable us to compete with peers such as Milford and Fisher Funds.”
The $5 billion Milford, for example, has a private wealth division of 13 including nine authorised financial advisers (AFAs) while Fisher, with assets over $7 billion, reports an advice team of seven.
According to Taylor, once operational, the Pie investment advisers would help grow the wider business as well as provide advice to the manager’s existing 2,000-strong clientbase – most of whom have arrived direct via word-of-mouth referrals.
“Some of our existing clients may want advice,” he said. “We expect other [advisory] clients will come through word-of-mouth too.”
Taylor said the Pie wealth advisory process would focus on getting client asset allocation right first with product selection a secondary factor.
“We’re working through the approved product list now but we will recommend our own funds where appropriate,” he said. “Plus, we will be able to include other products – say, a client wants to keep an existing fixed income investment, for example – as needed.”
Pie was still working through some of the finer details of the financial advice offering, including investment platform and risk-profiling tools, but should be ready to launch soon, Taylor said.
“Simon is looking at those now,” he said.
Prior to joining Pie Hepple served nine years with Westpac as a financial adviser. Previously, he spent nine years in the UK as a high net worth lending specialist and derivatives adviser.
Known primarily as an Australasian small caps specialist, Pie has broadened its investment offer since inception to reach nine products (albeit one, the Chairman’s Fund, is a best-of compilation) covering mainly Australasian and global equities.
Latest addition, the-now almost $40 million Pie Multi-Strategy Fund, launched last November to provide a hedge fund-like strategy. In January, Pie also changed the name of its Cash Plus product to the Conservative Fund to reflect its 20 per cent target weight to equities (invested in underlying Pie funds).
As well as expanding the product range – with another more broad-based global equities fund in the offing – Pie has made several senior hires recently including former Financial Markets Authority (FMA) director of external communications, Paul Gregory, as head of investments last December and Doug Jopling, as Australasian unlisted investments co-portfolio manager this January.
The two Pie funds tracked by consultancy firm Melville Jessup Weaver – the Australasian Growth and Emerging Growth funds – were down the bottom of the pack last year with the former losing 4.1 per cent during the 12 months to December 31, the only one in the MJW peer group to fall into the red. However, over longer time periods both Pie funds in the MJW survey recorded well above median results.
Documents on the Disclose website show the total expense ratios of most of the Pie range hover close to or above 4 per cent with performance fees typically representing more than half of the fund charges.