What is OBSR?

Old Broad Street Research Limited (OBSR) was established in July 1999, as a result of a Management Buy-Out of the research business within Buck Consultants. OBSR’s two Executive Directors had previously been the key players in Buck Research, and have over 50 years of directly relevant experience between them.

The team has grown through the acquisition of highly motivated individuals from all areas of the industry – asset managers, independent financial advisors (IFAs) and product providers. All bring relevant experience to boost the research and consultancy capability of OBSR for the different types of client.

Research Approach & Methodology

Old Broad Street Research (OBSR) uses an investment research approach that has been in place since 1994. The emphasis is on looking forwards, not backwards; and for this reason, we place a great deal of importance on the qualitative aspects of our research. Our conclusions are nonetheless informed by detailed statistical (quantitative) analysis. This means we are aware of past results rather than driven by them and we use the information to validate our qualitative research.

Philosophy

At OBSR we believe that by undertaking detailed and thorough qualitative research, informed by quantitative analysis, we are able to identify funds that are capable of fulfilling their objectives and therefore of meeting clients' expectations in the future. We believe that we are able to achieve this by gaining an in-depth understanding of each fund and in particular the investment philosophy that lies behind it, the environment in which it is managed, the effectiveness of the investment process and how risk is defined and managed.

There are many different, successful ways of managing funds. Our role is to enable our clients to understand these different approaches and to identify the best of each so that appropriate funds can be selected for their clients.

Process

We devote the greater part of our efforts to qualitative analysis and base our judgements on face-to-face discussions with the senior business managers and other key personnel, as well as the investment managers at fund management groups.

We believe that, irrespective of what type of fund is being evaluated, it is important to understand fully the context within which an individual fund manager or team operates. We seek to satisfy ourselves that a given manager has a clearly defined investment brief, a reference benchmark against which performance can be judged, the necessary technical and human resources to deliver consistently good results and a robust methodology, including effective risk control procedures. Our qualitative analysis involves careful consideration of the following aspects of an investment management group:

• Ownership and stability: is the owner of the management group committed to the retail (ie unit trust and OEIC, life, pensions and or multi-manager) business? Is the investment team resourced properly and does it have the capability to deliver the investment objectives?
• Investment philosophy: what is the investment philosophy that lies behind each fund, how does the manager think he or she can add value and why?
• Investment process: what process does the group, team or manager employ to ensure that the philosophy is applied effectively and consistently?
• Personnel: does the group have sufficient resources to deliver the investment objectives? Does it have strength in depth or is it highly reliant on the special talents of a few individuals? We also consider whether the organisation promotes a star manager culture or uses a team approach.
• Research resources: to what extent are ideas generated within the group and what emphasis is placed on the use of external resources, for example brokers, economists, media services, etc.?
• Risk controls: how does each organisation think about and define risk? Is there an effective method for monitoring risk and ensuring that managers adhere to the guidelines for portfolio mandates, and to what degree is such scrutiny independent of the fund managers?