Chiara Mauri from Fideuram AM SGR, is our Fund Selector of the Month

Chiara Mauri currently works as Head of Fund Research & Alternative Investments in Fideuram Asset Management SGR where she conducts regular meetings with fund managers and produces key investment case literature and defines approved investment lists. She leads a team of 9 professionals specialized both in liquid and private markets. She is responsible for the Funds’ research and selection and her focus is mainly on developed equity markets; she is also portfolio manager of some equity funds of funds and segregated accounts. Moreover, she recently got a specialization in ESG Analysis & Investing at the MIP Management Academy. She joined Fideuram in 2007 and previously worked for 7 years in the asset management team at Banca Profilo where. She was a mutual fund analyst and portfolio manager.

Could you please tell us about the Fund Selection process at Fideuram Asset Management SGR?

In Fideuram AM the Fund Selection process is based on a quant-qualitative approach. Selecting funds is both a science and an art. The first step is quantitative in order to filter and reduce the universe of reference: we rank funds classified in the same peer group according to standard quantitative metrics such as alpha, beta, sharpe ratio, information ratio, and then we focus our analysis typically on players that are not included into the last quartile. For each fund of interest, we perform detailed due diligence that both take in consideration quantitative metrics and qualitative considerations. Key elements of our analysis are the meetings with the portfolio managers and follow up conference calls to understand his/her DNA and be aware of any style bias embedded into the strategy, the portfolio analysis and the Team debate that takes place for any single strategy subject to be included into our opportunity set. It is precisely this debate that enrich the analysis being based on different point of view and considerations.

How many people are in your team, and how is it organised?

The Fund Research & Alternative Investments Team is made of 9 professionals: 6 analysts dedicated to liquid solutions and 3 dedicated to private markets. Our liquid investment funds analysts are specialized by macro asset class, sectors or regions, while all the private markets’ analysts have a deep knowledge of the Fideuram Alternative Platform and share all info. They monitor new and existing alternative funds in a collegial way.

What parts of your role do you find more challenging? And what parts would you say are the most interesting to you?

The biggest challenge in my role is to find the best balance between research and analysis of new and existing funds while staying up to date with regulatory compliance changes. Moreover, my role as Head of Fund Research & Alternative Investments requires leading a group of people in accomplishing both personal tasks and common goals while achieving organizational goals coordinating with other teams of the Group… Thus, the work never ends!

The most interesting part of my job is to learn as much as possible about financial markets from colleagues and portfolio managers I regularly meet; you can’t select a good fund if you’re not familiar with the related asset class.

What processes do you have in place to identify a good manager? What are the differences between a good manager and a not so good one?

Good managers included in our investable universe are ones that show portfolio implementation consistent with the investment process, resilience in different market conditions, an excellent level of transparency and a liquidity profile in line with our expectations. There are a number of reasons why a fund manager doesn’t fit our criteria; for instance managers who don’t have clear buy and sell discipline and typically are used to take more risks than allowed by the investments process.

Do you have any red lines when selecting a fund? Are there any sectors, or themes where you would never invest in?

Concentration and liquidity are two areas of risk we monitor with attention.
Furthermore, in the last two years there has been an increasing emphasis and attention on sustainability and the selection of funds is moving more and more in line with the ESG policy of the asset management company and with the ambition of being an asset management company committed to the objectives by NZAMI.

How are you navigating the current inflation and volatility in the markets?

2022 has been a challenging year with several headwinds for markets and for fund selectors. Higher interest rates and inflation, geopolitical risks, the possibility of a recession in developed economies have become the new normal scenario. To navigate in this environment, we hold a cautious and flexible approach adding diversification into portfolios; we combined both directional ideas with alternatives and absolute return strategies that can be more resilient, uncorrelated to broader markets, benefitting from periods of stress and higher volatility.

Which sectors and trends do you think will perform better in 2023?

My investment outlook for 2023 is more positive. Even if investor sentiment is still dour as the global economy is facing challenges, I think a widespread recession is unlikely and few good news are supporting a more positive stance for the next year. Earnings estimates have declined, but corporations are navigating the economic environment extremely well; inflation has been high and persistent, especially in the U.S. and Europe, but signs point to moderation ahead; in China, the government has committed to additional loosening of the dynamic zero Covid policies moving the country towards a re-opening going into next year. Looking at equity in particular US Small and Mid-cap could be a sweet spot as they offer domestic exposure and robust earnings at attractive valuation; we still think that banks, energy and, as anti-inflation assets, infrastructures could offer interesting upside in the year ahead.

How would you define yourself in 3 words?

Pragmatic: being reasonable and practical
Passionate: being curious with a lot of interests and enthusiasm
Perceptive: being astute and a great observant
Persistent: never give up
Professional: being reliable with a professional attitude