Winners rationale

Challenging traditional portfolio management theory, both equities and fixed income struggled to deliver in 2018, thereby motivating Asia’s investors to revisit their reluctance towards relatively less transparent, illiquid investments and increase exposure to alternatives via private markets and hedge funds.

While the industry, in general, continues to focus on providing exclusive access to leading managers, Goldman Sachs Private Wealth Management has successfully differentiated its alternatives proposition by building an impressive pipeline of relevant opportunities and, crucially, negotiating more favourable terms for its clients.

Throughout 2018, Goldman Sachs’ private clients benefitted from access to over 20 private equity offerings built around four key themes: emerging managers, secondary unicorn opportunities, real estate secondaries, and leveraged buyout opportunities.

Specifically, the bank has tapped into the divergent emerging managers universe — which includes women- and minority-owned firms — through a private equity seeding fund, while it advises clients who want a piece of the US$1 trillion unicorn pie to invest through a global tech late venture and growth equity fund alongside a US-focused tech growth equity fund.

Goldman Sachs has also utilised a global secondary real estate fund with high exposure to Asia and EMEA to capture Asia’s growing secondaries market which now represents 23% of global private equity. And to take advantage of the evolving energy opportunity set caused by a shift from appreciation-oriented strategies to cash flow and growth-centred strategies, the bank selected a play focused on real asset investing in the upstream and midstream segments of the North American oil and gas industry.

Within hedge funds, Goldman Sachs added new offerings and enhanced the proposition available to smaller clients by introducing a new programme with a significantly lower minimum investment amount compared with the existing programme. Goldman Sachs Private Wealth Management distinguished itself further by effectively negotiating for favourable terms, such as better fees, with more than 60% of its managers — the benefits of which are passed directly to end-clients.

The bank’s customers have responded in kind, with Goldman Sachs Private Wealth Management recording net inflows into alternatives of over US$1 billion for the sixth consecutive year. Not one to rest on its laurels, the bank continues to improve its proposition with enhanced client coverage, greater tools for reporting and risk management, and the expansion of its China onshore platform.

Goldman Sachs Private Wealth Management separated itself from the crowd in a hotly contested competition and is deservedly Asian Private Banker’s Best Private Bank – Alternative Advisory for the fourth year running.