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«Take 6 percent return and translate that to a potential shortfall of 10 or 12 percent – you will see the person’s expression change as that sinks in,» Vincent Magnenat, the new CEO Asia of Lombard Odier, tells finews.asia.

Vincent Magnenat, in Asia Lombard Odier is focussing on families. How do you intend to expand this business?

Lombard Odier’s long history as a business run on family business lines means we have a first-hand understanding of our clients and their priorities. The need for structure and governance within a family business is bigger than ever.

We help clients to professionalise how they organize, protect and pass on their wealth. As the world becomes more and more global and so do our clients, the importance of reporting its financial situation is key for every family.

«You cannot be everything to everyone»

Having said that, another pillar of our offering is our technology, our platform. We are looking at technology as a client servicing tool and not as much as, say, a robo-adviser. And thanks to our technology we are also able to cooperate with our clients’ other banks as a global custodian.

Some of your competitors offer investment banking services. Lombard Odier doesn’t, why?

You cannot be everything to everyone. Our clients have several bank relationships. Nowadays we see that clients choose their bank or banks for the needs they have.

In a sense, clients always use the bank for what it stands for, for example you can go to a bank that can offer you the best corporate finance, but that is not necessarily the best discretionary portfolio manager.

How do you find out the risk tolerance of a client?

With regard to investment philosophy, Lombard Odier’s core-satellite approach is a pace-setter in Asia. Its core portfolio management service is based on a discretionary and risk-based approach, focusing on investment risk management while offering returns that meet our customers’ goals throughout their investment terms.

«The risk-based approach mitigates volatility swings and large valuation drawdowns»

Complementing the core are the satellites, which serve to enhance the portfolio through high convictions and/or client preferences. The key benefit of our discretionary offering is precisely the robust nature of our investment process: the risk-based approach mitigates volatility swings and large valuation drawdowns, and effectively helps to compound returns and grow private client capital over the long term.

«Lombard Odier certainly has strong values after 222 years of existence»

To understand the risk tolerance of a client, we help clients to put any potential return in relation to a possible drawdown. Take 6 percent return and translate that to a potential shortfall of 10 or 12 percent – you will see the person’s expression change as that sinks in.