The Brandywine Difference
Brandywine is uniquely positioned to provide investment management and portfolio allocation services to the CIO of your family office. Listed below are some of the key differentiators that distinguish Brandywine:
- Longevity and actual trading experience. Since 1982, Brandywine and its principals have accumulated extensive trading skills across a broad variety of investment products and instruments. In addition to being proficient in the equity and fixed income markets, we have developed – through actual trading – a core competency in non-correlated alternative investments, including managed futures, crisis alpha, market neutral equity, tactical asset allocation, venture investing and entrepreneurship, real estate development, residential rentals and construction, risk arbitrage, swaps, structured products, equity options and other equity derivatives.
- We bring a trader/investor’s knowledge, as opposed to the perspective of an allocator. This is significant in that a trader/investor has a completely different viewpoint than that of an allocator. An allocator views a portfolio from the top, first determining areas to allocate assets, and secondarily looking to find the “best of breed” managers for each bucket. While this sounds like a laudable approach, almost by definition it misses investments that are not easily categorized, which often include some of the best opportunities for both return generation and risk mitigation. Simply creating an “alternatives” bucket to allow for these investments is not enough in that the portfolio will still be biased towards correlated investments during periods of market unrest (think equities, corporate bonds and real estate all suffering simultaneously during the financial crisis).
- Institutional focus on risk management. We literally wrote the book on portfolio allocation and risk management. Our founder’s best seller introduced the use of Return Drivers and true portfolio diversification to properly identify and manage portfolio risk. He was clear in our belief that the use of current portfolio “optimization” techniques and passive investing to create 60-40 portfolios is akin to gambling.
- Belief in the future, not the past. We don’t believe investing is as simple as “doing what worked before.” Future risks and opportunities only become obvious in hindsight. The “buy-and-hold” mentality is fraught with exceptional risks, most of which we cannot even identify today. That is the nature of risk. Brandywine remembers the threat of “Japanese dominance” to the world economic order in the late 1980s. We were trading in the Japanese equity derivatives markets at the time. But today, after decades of being ravaged by multiple extended recessions, the Japanese stock market remains more than 30% below the peak it reached in 1989. We subscribe to the belief that “anything can happen here.” And we will prepare you for the “anything.”
- A legacy of continuing innovation. We love research. Although the majority of our research ideas have been derived from our market trading experiences, we also collect, catalog and prioritize numerous other ideas for ongoing research. We are voracious readers and students of the markets. And unlike others who think primarily of stocks when they hear the word markets, Brandywine has a much broader view. Since 1982 we have developed strategies and traded in more than 100 global financial, currency and commodity markets. We also don’t constrain our research to asset classes, but instead research and employ strategies across disparate Return Drivers. This provides us with a natural ability to structure truly diversified portfolios.
- Hands-on personal approach in our relationship with you. Brandywine has only recently made the shift from trader/investor to Chief Investment Officer. Your family is highly important to us. From the first meeting on, you will receive hands-on attention from Brandywine’s principals. Every decision will be made by the owners of Brandywine and we have structured our business to ensure you will have our full attention.