Investment Managers
Asset hybridisation is an innovative concept at the heart of Sienna IM’s multi-expertise business model. In practical terms, it involves combining traditional listed assets with unlisted assets, such as private debt, private equity, infrastructure and property, as part of a strategic allocation.
A pioneer in hybrid investment strategies, Sienna IM provides private investors with differentiated investment solutions combining several asset classes. This innovative approach helps to reconcile the need to finance the economy and the need for yield over the medium to long term, with the added bonus of lower volatility. The philosophy behind this investment strategy is based on 3 pillars: Asset Allocation, Decorrelation and Diversification.
On average, the French start saving for their retirement at the age of 42, providing an investment window of around 23 years. The ‘hybrid’ investment strategy is suited to extended time horizons. Private assets are characterised by their lower correlation to capital markets, making them less sensitive to market volatility. They also tend to generate higher returns over the long term thanks to their growth potential and stable cash flows. Listed assets, on the other hand, offer immediate liquidity and visibility on the financial markets.
Another advantage of hybrid funds is that they are accessible to the vast majority of investors, including those in employee and retirement savings schemes. Traditionally, access to unlisted assets required a significant initial financial commitment or calls for funds spread over several quarters, which meant that they were reserved for institutional investors and the very wealthy. This is what we call the democratisation of real assets, accessible to all with a modular risk/return profile.
To have a gross supplementary income of €1,000 when you retire, you need to have almost €300,000 of accumulated capital. And it’s not with returns that barely cover the risk of inflation today that savers will have a significant amount of capital built up by the time they retire. Hence the concept of diversification and the idea of including riskier assets, such as non-listed assets, in an allocation. This is essential as part of a medium- to long-term allocation
Opinion of Xavier Collot, Managing Director – Listed & Hybrid Assets
The French Green Industry Act, which will allow a proportion of non-listed assets to be included in managed funds, will be a major catalyst for this democratisation, which is already under way. It will enable savings to be channelled into a less carbon-intensive real economy, and to generate a higher return than inflation, exceeding 5% on the most aggressive profiles.
Investing in private assets, is about giving meaning to your savings by focusing on tangible, visible assets.
Opinion of Xavier Collot, Managing Director Listed & Hybrid Assets
