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OUR INVESTMENT PHILOSOPHY

About Us

QuayStreet Asset Management Limited (QuayStreet) is a specialist funds management firm with a team based in Auckland, New Zealand and Sydney, Australia.  QuayStreet offers a range of diversified and sector specific investment funds for investors.  Our specialists seek to deliver superior investment returns for our clients by actively managing the funds.

Our Investment Managers, Andrew South and James Ring, are investment specialists, with a depth of experience and expertise within the New Zealand and global markets.

Our Investment Philosophy and Process

The QuayStreet investment philosophy is that an actively managed and concentrated selection of investments can provide better returns than market benchmarks. We maintain that market inefficiencies do exist, which from time to time result in attractive investment opportunities. Examples of these include:

  • Short term investment mentality by market participants
  • An over-reliance on broker analyst earnings estimates and faith in company management
  • A lack of understanding or appreciation of a company’s business model
  • Trading volatility related to specific events e.g. Index changes

We target investments which have good and sustainable underlying business models which are trading at an attractive valuation in relation to their “intrinsic value”. The “intrinsic value” is the valuation we derive after extensive analysis that values the future cash flows of the investment at today’s prices. This basic philosophy applies to all security types and assets that we invest in.

Following this investment philosophy, our Funds tend to be more concentrated than their respective market benchmarks. We have a high level of conviction in our investment ideas which is reflected by larger investments in a smaller number of securities that differ from market benchmarks. However an appropriate level of diversification relative to the Funds’ risk profile is maintained at all times.

We believe in the benefit of being proactive, but not hyperactive in terms of managing the portfolios. We do not transact frequently and generally buy securities with the intention of holding them for the long term. However we do monitor investments closely and add to holdings that we believe are good value relative to their outlook and reduce those which we believe may be facing increasing risks.

In regard to our general investing approach, we do not favour one particular style e.g. large companies over smaller companies, growth over value. Markets are dynamic, the way they price securities changes constantly and every investment is assessed on its merits. However, a high emphasis is placed on underlying investment fundamentals including:

  • Quality of company management and corporate governance structure
  • Evidence of disciplined capital management with appropriate investment hurdles
  • Industry structure and competitive positioning
  • Earnings volatility and visibility
  • Exposure to structural and regulatory change

The investment team spends a great deal of time understanding all aspects of an investment. We meet regularly with company executives, research analysts, industry contacts and attend industry conferences. This is in addition to analysing financial statements, undertaking scenario analysis and valuation modelling to determine “intrinsic values”.

All investment ideas are subject to peer review and rigorous debate on the underlying investment rationale. We have regular investment team meetings where all investments are open for review and where new research is discussed. This is also the forum for discussing quantitative tools that are used to filter for new investment ideas, monitoring the performance of existing investments and monitoring the risk exposure of each Fund.

There is also oversight by a separate compliance team. The compliance team have full visibility of all investment positions, and they monitor adherence to each Fund’s investment guidelines.  

Responsible Investing

QuayStreet Asset Management Limited promotes and encourages responsible investing through the Balanced Socially Responsible Investing (SRI) Fund, which launched in 2007. The Fund currently adheres to a Socially Responsible Investment Policy and screening process which seeks a balance between the financial and the socially responsible performances of an investment. 

Signatory to the United Nations-supported Principles for Responsible Investment (PRI) initiative
In February 2017 QuayStreet became a signatory of the Principles for Responsible Investment (PRI). Established in 2005 by the then United Nations Secretary-General Kofi Annan, PRI is regarded as the world's leading advocate of responsible investment globally.
Find out more

Corporate Governance

We do not handle our clients’ money. All money is held in bank accounts controlled by an independent licensed Supervisor, The New Zealand Guardian Trust Company Limited (NZGT). All payments and receipts of monies are made between the client and the Supervisor.  All investments are held in the name of the Supervisor via an independent custodian, Citibank N.A.

NZGT has been granted a full licence by the Financial Markets Authority under the Securities Trustees and Statutory Supervisors Act 2011 to act as Supervisor of the funds.  Further information on the Supervisor’s licence is publicly available on the Financial Markets Authority website: www.fma.govt.nz

Both the Supervisor and the Custodian are independent of QuayStreet Asset Management Limited.

QuayStreet Asset Management Limited (QSAM) is the Manager and Issuer of the QuayStreet Funds and KiwiSaver Scheme. Please refer to the QuayStreet Funds Product Disclosure Statement or the QuayStreet KiwiSaver Scheme Product Disclosure Statement.