The UK has seen a catastrophic slide in interest rates compared to rising inflation within the past 6 months. Already interest rates have been going down for the past couple years but now we are seeing even worse conditions.
Investors today are now used to taking as low as 0.01% per annum in their standard savings account. They have been beaten into submission, now only relying on banks and corporations to hold their own money and do nothing with it, giving very little returns which are not even near proportional to the rising cost of living. This begs the question; what are the impacts of this?
We interviewed senior Portfolio Manager at Barton Medlock Mr Sebastian Goldstein on what he thinks will be happening and he said ‘Well what we are seeing already in the last few years are investors moving away from traditional investments such as your basic ISA and fixed rated bonds to more alternative ways of investing, there’s been a massive spike in things such as whisky cask investments and wine but the thing is these returns have no reliable statistical table in regards to your ROI’.
Mr Goldstein manages a portfolio of over £300 million which primarily deals with Fixed Term Deposit accounts, Stocks, shares, equities and derivatives so I asked him what he’s been seeing within his own portfolio. He explains ‘ So most of my clients I primarily deal with are HNW individuals starting at a minimum of £250k and what I like to do is get an insight into their appetite for risk, goals, realistic ROI and what they really are trying to achieve within their time frame, so basically I tailor make each account which means some work autonomously with our algorithmic trading systems and a lot of accounts I will manually execute some trades if not all if they are wanting that human touch, as this will normally bring a lot more money a lot quicker but the risk is higher.
Barton Medlock have been trading since 2006 with just over £1.5 Billion under management. Although they have always dealt with the corporate section of the market, they have now opened up to retail investors with a minimum at just £10,000. It seems there may be hope just yet for the retail market who have been subjected to abysmal rates of returns with no where to go but to the bank.
It seems the banks are no longer monopolising the fixed rate of return market with Barton Medlock introducing their Fixed Term Deposit account at a whopping 6%. This account has all the protection and if not more than what banks offer and with a flexible approach to being locked in to an investment. Mr Goldstein says ‘it doesn’t make sense why people should have money eroding in their account with no solution’ ‘our ATS accounts achieve roughly 15-20% so providing the retail world with a fixed 6% in which the system will achieve more for us just makes sense for all parties’
An interesting take from Barton Medlock and what’s to come, have they revolutionised the retail market and will it make our savvy investors comfortable or will they still be sticking to the standard low rates of return they have been used to for the last decade.
Sebastian Goldstein review
AUTHOR: Katheryn Devine