ANTYA Delivers for Its Wealth Management Clients – Trounces Passive and Active Strategies
Q1. Tell us about yourself and about ANTYA Investments Inc. (“ANTYA”)
Answer: ANTYA is a portfolio manager regulated by the Ontario Securities Commission. We are registered to serve clients in Ontario, Alberta and British Columbia. All client accounts are protected by Canada Investor Protection Fund upto $1million against fraud or theft. Earlier in my career I was a strategy consultant at Bain & Company, and subsequently for approximately 14 years I pioneered the independent equity research movement in Canada alongwith my partners at Veritas Investment Research. I started ANTYA in late 2015 because I believed that there is a better way to service informed clients via lower costs and deep-dive research. My experience in forensic accounting, strategic analysis, corporate governance is an added asset for my clients.
Q2. How is ANTYA’s investment approach differentiated?
Differentiation is in the results that ANTYA has achieved for our clients. After four years of investing history, the ANTYA 20-20 portfolio is ahead of the S&P/TSX 60 by 20%. That is a value addition of 5% every year. Since inception, our emphasis has been on adding value to client portfolios via astute asset allocation, and by investing in asymmetrical investment opportunities. What that means is that ANTYA 20-20 attempts to capture the market return at its core at the least possible cost. Outside the core ANTYA’s actionable and results-driven investing process is based on extensive fundamental research to identify asymmetrical investment opportunities. For example, ANTYA has held Tesla Inc. in client portfolios since inception. During 2018 and 2019 every market observer and media channel has been espousing bearishness on Tesla and forcasting the company’s bankruptcy. Nonetheless, ANTYA’s extensively published research ultimately triumphed over the naysayers and some of that is available on our website. Patience and belief in our work ultimately rewarded our clients.
Q3. How do Canadian investors especially benefit from your approach?
A unique feature of ANTYA’s global investing process is that we are overweight outside Canada. That also means our clients have no direct exposure to commodity stocks; be it Gold, Oil or other industrial or precious commodities. That appears counterintuitive given that Canada is a resource rich country. However, ANTYA’s holds the view that an overdependence on resources, real-estate and inbound immigration has created significant imbalances and misallocation of resources within Canada. Furthermore, commodity stocks are driven by factors beyond the control of producers and hence our time is better devoted to assessing factors that managements can control. Therefore, since the establishment of the portfolios on April 01, 2016, commodity returns, or a lack thereof, have been captured via market exposure in the core of the portfolio and not stock-specific exposure. Our approach yields results, with excess returns exceeding $200,000 over four years, on a million-dollar portfolio. That is 20% of a client’s initial capital.
Q4. What are your views on the unfloding COVID-19 crisis?
COVID-19 has once again exposed the inability of mainstream money managers to protect client capital in times of duress. However, the mantra of all money managers is that stay invested, and “this too shall pass”. ANTYA differs from this mainstream view and believes that over the next 12-18 months significant wealth destruction and a redrawing of industries is in store. It is unlikely that mainstream Canadian corporations will be a party to redrawing this landscape. Therefore, what has worked in the past , will not work going forward. Since 2000, we have witnessed permanent wealth destruction via ill-advised but well-marketed investments before, in technology stocks (remember Nortel and Blackberry), income trusts ( remember Yellow Pages), Oil & Gas Stocks (repeatedly), Gold stocks (in vogue currently), cryptocurrencies, and most recently in Marijuana Stocks. What is coming down the pipe will be more destructive, irrespective of the recent bounce in global equity markets. COVID-19 is a one in a one hundred year event, and its impact will be equally lasting. Therefore, clients need to work with wealth managers capable of providing intellectual leadership and independent advice in the best interest of the client. Most investors that are focussed on the next news item or next years earnings could suffer additional and sudden capital losses. Others could continue to underperform and keep paying high fees.
Q5. Why are fees important, now that you bring it up?
Given that interest rates are approaching almost zero, and stocks have declined significantly from the peak, and in ANTYA’s view are about to enter a medium-term bear market, investors need both; an intellectually robust wealth management services, as well as, lower fees. Management fee plays a critical role in determining accumulated capital at the end of the investment horizon. ANTYA’s all-inclusive fee of 1.25% per annum, charged monthly in arrears, saves clients upwards of $100,000 on a million-dollar account over ten years. Any returns earned on those savings would compound over time as well. That compares to most people charging 2.25%-2.5% per annum. At that rate, the wealth manger accumulates wealth at a faster rate than the client he/she is servicing. We do not charge any success fee either. ANTYA’s approach and philosophy is based on our status as a fiduciary towards servicing its clients.
Q7. Are there clients that are not suited to your investment approach?
That’s a very good question and I’m glad you asked. Those interested in providing trading ideas, those in the habit of calling their wealth manager on a daily or weekly basis and those clients that are always on the lookout for the next hot idea are not our ideal clients. We want our clients to be successful at what they do, so we can devote our time to doing what we do well. While all accounts are accessible online, we provide updates on a quarterly basis and discuss investment strategy on an annual basis. It is in time of stress that out investment process shines by protecting the downside, and we did that both in 2018 and once again in early 2020 during the current COVID-19 crisis.
Q6. How do you compete against the big guys in the room?
The beauty of our business is that intellectual capital is no one’s property. Beyond that, our entire process is electronic. That means that client accounts are opened electronically and we never touch client cash nor do we have access to it. Client bak accounts are linked directly to their respective investment accounts. Reporting on client returns is done by NDEX, which is the largest 3rd party asset reporting platform in Canada with $100 billion of assets. Our brokerage is owned by CI Financial which is Canada’s largest mutual fund company and assets are custodied at Computershare Trust company of Canada. Once an account is set-up, it is seamless, client friendly and client centric with top-notch cybersecurity given that the entire infrastructure is managed by large well-funded insttutions.
Q7. Where can prospective clients reach ANTYA?
Given the current social distancing norms in place, we are easily able to set-up meetings over, SKPYE, Facetime or Zoom. Clients can call 416.860.9797 or write to firstname.lastname@example.org. We can also send you a no-obligation corporate presentation outlining our philosophy, results and background electonically.
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