‘Proper Pub. Proper Beer. Proper Food’ is how the Broad Chare, a ‘canny’ watering hole near Newcastle’s quayside, describes itself, writes Eleanor Mahmoud. House ales from the Tyne valley, wooden interiors and ham shank and pease pudding as the dish of the day, this seems like the epitome of ‘Pub Club’.
Today we are meeting John Dance and Ekra Vir from Vertem Asset Management. Dance is an investment manager and founder and branch principal of Vertem, established in 2010.
Vir, investment associate, is one of the newest members of the team and tells us: ‘I recently completed my masters in global financial management and joined Vertem in January, after doing some work experience here.’ Expanding on her favourite part of the role so far, she continues: ‘I really enjoy finding hidden gems when stock picking.’
We make ourselves comfortable at our table and immediately eye up some classic British grub or ‘scran’. ‘We were clamming’ (translation from Geordie: where’s me dinner, I’m starving)!
It’s clear that Vir is not the only one who enjoys stock picking. Dance enthusiastically agrees, telling me: ‘We see the value in being expert stock pickers and do a lot of research into stocks. It’s much more useful when speaking to fund managers if you know what they hold in their portfolios and can use that knowledge to challenge their views.’
Dance (pictured) explains that stock-specific knowledge gives them a good grip on the economy and feeds into asset allocation decisions.
We order some wine for our table as he says: ‘International companies will report on a global regional basis, so you can get an early read into the economic performance of different geographic areas, which may influence our global bond and equity allocations.’
I am a little disappointed to report that no-one ordered the dish of the day, but we do make the most of the Broad Chare’s menu. Lancashire cheese croquettes, deep fried monkfish cheeks and bubble ‘n’ squeak make their way over to our table.
The team of 15 at Vertem deliver investment management services to clients, largely introduced by the IFA community. They look after around £325 million of assets under management and Dance is pleased to tell me there has been plenty of new business coming in.
We discuss the firm’s growth and plans to expand its regional client base. Dance explains how he’s seeing movement in the industry: ‘At one time the industry went in a way where it was easier to operate nationally. However, clients now commonly want to be connected to their investments, so it’s almost coming back the other way – they want their investment manager to be local.’
As we make our way through lunch, we get a little distracted – we have discovered Dance has a rather interesting hobby. He owns a number of racehorses which are sponsored by Vertem. He is also involved with breeding and selling the horses at auction. With one horse due to make its racing debut, Dance is in his element talking about them.
In an attempt to bring the conversation back round to work (and a rather good attempt at that), he says: ‘Owning race horses is like a diversified stock portfolio. If you only own one horse, you have a higher chance of losing money quickly whereas if you have more, they help to cover each other’s costs.’
As always, I’m keen to ascertain where the team is finding investment opportunities.
Dance tells me they are currently overweight in European equities and explains how the ‘momentum of European data is generally very strong and there’s some solid sub-sector performance going on’.
They are also showing an interest in emerging market bonds in local currencies, saying: ‘We’re playing into the yield and currency moves.’
With our wine, food and coffee finished, we think about what’s next. Dance concludes: ‘We had an asset allocation chat and decided we’re not ready to commit to being bearish just yet. However, it’s like the cold war, our fingers are poised on the button.’