Anne-Valère Amo from TrackInsight is our Fund Selector of the Month

Anne-Valère Amo is Head of ETF Selection & Strategies at Trackinsight, responsible for expanding its tailor-made institutional client offering related to ETF selection – including advisory, independent ETF due diligence and model portfolio solutions.

Prior to joining Trackinsight, Anne-Valère Amo spent more than two decades in the financial sector. She worked at Bank Lombard Odier & Co Ltd where she headed Quantitative Research, Investment Risk Management as well as ETF Selection and Advisory. Before that, she held roles as Senior Quantitative Analyst at Union Bancaire Privée SA and as Senior Statistician at MSCI Inc where she contributed to the creation of the Global Industry Classification Standard (GICS).

Anne-Valère Amo holds a Ph.D. in fractal analysis applied to Finance from the University of Geneva where she worked as a Teaching Assistant in Mathematics and Statistics.

Why and how did you start your career in the financial sector?

I was fascinated by Fractal Geometry created by French Mathematician Mandelbrot in the seventies. Without any computer, his new representation of the world enabled a more realistic formalization of fat-tailed events such as financial crashes. With the advent of super computers, it was too tempting to apply his theory in the financial sector collecting loads of data.

Taking a brief look at your working life, what would you highlight about your professional career?

Looking back, I realize that fund selection is above all a human adventure. The mission of a fund selector is not only to master the investment process of an asset manager but also to establish a relationship of trust while maintaining an objective distance. The challenge is to find the right balance over time. AI and Big Data cannot replace this inescapable human touch.

What aspects do you consider most important when selecting a fund for a portfolio?

Fund selection is one of the ingredients of the alpha generation recipe which must support market timing and asset allocation skills. In other words, the fund must fit into a broader landscape by responding to asset class, country, sector and style bets.  

What mistakes are most frequently made in fund selection?

The following mistakes are commonly made, unconsciously or consciously:

• chasing past returns and expect an asset manager to outperform in any market condition,
• the Bandwagon Effect, i.e., to be influenced by fashionable ideas,
• thinking that - unlike active fund managers - passive fund managers do not deserve a thorough due diligence. The significant growth of thematic ETFs since the 2020 Covid Crisis is an excellent case study of a real need to know your tracker: no two ETFs track the same index which has an active tilt most of the time.

What assets do you think will perform better in 2024?

Fixed Income should offer an appealing risk-return profile in 2024 after a rocky road in 2023 and a dreadful year in 2022. The bond market rallied over Q4 2023 with yields hitting their highest levels since the 2008 Global Financial Crisis, partly spurred by the Fed’s expected interest rate cuts in 2024. Investors should therefore be in the market and earn a high carry while waiting for price gains, which should come through at some point during the year.

When you have free time, what do you like to do?

Spending quality time with my three boys. They bring me back to basics.