When people hear the word "holistic," health and wellness is often the first thing that comes to mind. Mackenzie Investments, which manages $64.3-billion in assets and serves more than 1 million clients, believes thinking holistically holds the key to building healthier portfolios.
Taking a 360-degree view of investing is essential because conditions are changing constantly, says Barry McInerney, president and CEO of the nearly 50-year-old firm. "We're evolving because we know investors want and need new solutions from asset managers."
For instance, since the 2008-'09 financial crisis, central banks have been using monetary policy to try to bolster economic growth, Mr. McInerney explains. "This has created a different environment, with different policy risks, that investors and investors and advisors have to navigate," he says. "Investors need more engines, like enhanced diversification, to add value to their portfolio returns."
Weaving through the different central bank policies to manage investors' risk is especially tricky, given that the global economy remains persistently volatile.
Toronto-based Mackenzie works as a partner to financial advisers, offering a wider selection of products and services than any other independent Canadian asset manager. These range from exchange-traded funds (ETFs) and balanced mutual funds to the firm's Symmetry Portfolios, a series of diversified and balanced portfolios managed by a team with deep pension management experience.
Understanding trends is another skill that Mackenzie brings to the table as a holistic asset manager. "Demographic shifts are prompting many investors to take market volatility much more seriously," Mr. McInerney says. "The leading edge of the baby boom generation is focused on retirement and de-accumulation of assets, so their needs for portfolio growth and income are changing."
Canadian baby boomers are also on the cusp of the biggest-ever intergenerational transfer of wealth: almost $800-billion over the next decade.
Mackenzie aims to ensure that the 30,000 advisers who distribute its products have the tools to build bridges to the next generation of investors.
"Millennials are an even larger group in North America than the baby boomers, and they're accumulating assets," Mr. McInerney says of the generation born between 1981 and 1997. "Young investors have their own take on investing within their needs for overall financial planning, including budgeting and debt management."
Millennials "are a more socially engaged group, so as investors, many of them focus more on applying environmental, social and governance [ESG] values to their portfolios," he adds. "Plus, they want better service from asset managers through technology, including mobile applications."
Knowing how to deploy and improve the technology that serves clients and their advisers is another part of being a holistic asset manager.
"There's a paradigm shift in how we use tools and how clients use them; robo-advisers is an example," Mr. McInerney says. Most financial firms are closely watching the advent of robo-advisers, even if they haven't established their own products.
"Both the pace of change and the needs of investors have accelerated over the past 10 years, and we're reshaping Mackenzie to better serve investors and their advisers," Mr. McInerney says.
Women are another demographic poised to transform the investment world. In 2014, Boston Consulting Group estimated that women controlled a third of all financial assets in North America. Research firm Investor Economics calculated that the Canadian portion equaled about $3.2-trillion, with $1.1-trillion of that total in intangible assets such as bank and investment accounts and securities.
As female investing power grows, so will women's demand for professional advice and financial management expertise. "As an industry, we have to reinvent ourselves to meet those changing needs," Mr. McInerney says.
For Mackenzie, the goal is to broaden the choices available to investors and their advisers in a strategic way. "We've launched new solutions that help investors enhance portfolio diversification and deal with increased volatility, and which focus more on risk-adjusted returns, not just investment returns," Mr. McInerney says.
He points to the firm's $100-million Diversified Alternatives Fund, which provides reliable risk and return patterns that for decades were available only to large institutional investors and ultra-high-net-worth individuals.
Mackenzie has also launched its own line of ETFs. "An ETF is a terrific vehicle that is efficient and effective for supporting investment strategies alongside mutual funds," Mr. McInerney says. "We're expanding the number of innovative investing options that investors or advisers can use to build portfolios."
The firm is proud of its other solutions such as the Charitable Giving Program, which helps investors to manage their philanthropic efforts, and the Registered Disability Savings Plan, an investment vehicle that allows families with members who are disabled to access government funding otherwise not available to them. Mackenzie is the only independent Canadian asset manager to offer both of these. And to keep clients up to speed on the latest developments in the global economy, the firm has brought in experts in international and economics who can share their knowledge of new regulations and offer a planetary perspective.
"Investors, markets and economies are changing in remarkable and exciting ways," Mr. McInerney says. "In this environment, we want to be an excellent asset management partner for advisers. We're trying to support advisers with quality, end-to-end asset management expertise and solutions that they need to help their clients succeed."
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