Publications

- June 1, 2021: Vol. 8, Number 6

5 Questions: Taking note of a world of investment strategies

by Kim Catechis

There is no shortage of investment strategies. There is value investing, growth investing, momentum investing, endowment model investing, contrarian investing, dollar-cost averaging, and the options go on and on from there. But what investment strategies truly work and bring sustained returns over the long term and during various economic conditions? It’s a question that has obsessed and bedeviled investment officers and asset managers since financial time immemorial.

One of the latest efforts to better understand that rare Midas touch has been undertaken by Franklin Templeton, the giant investment house, which established the Franklin Templeton Investment Institute in February. The new organization’s investment strategist is Kim Catechis.

What is the purpose of the Franklin Templeton Investment Institute?

In a nutshell, we created the Investment Institute in February to provide a platform to harness the unique global scale and scope of our firm’s autonomous investment managers and select academic partners. We generate data-driven research and insights from experts in more than 70 offices around the globe. Our long-dated thought leadership addresses complex investment issues with the intent of providing novel insights on market trends, opportunities and risks.

The institute is essentially organized as a think tank. Can you elaborate?

Investment team collaboration is central to what we do. We operate regular discussion groups that bring together diverse investment teams from across the firm. We hope to foster rich debate and discussion, and if we are successful, we will capture unique perspectives. These conversations are then made available to our clients and investors through published insights, giving an insider view to the thinking that’s driving our investment decisions.

What kind of investment insights might be culled from both across the organization and with outside partners?

As an organization, we have a multitude of investment teams operating in every asset class worldwide. As a result, the range of our analysis and themes is exceptionally broad. You can see some of our latest work in the insights section of our website, including long-term outlooks, investment papers and bespoke research. Our priority is to talk to clients and find out which investment themes are most relevant to them. Things like investing in an extended low-rate environment, ESG factors, alternatives, inflation, emerging market opportunities, etc., drive our conversations and insights. We also engage industry partners and academia to broaden the conversation. One of our key academic partners is the Green Templeton College at Oxford University. We participate in joint webinars and host exclusive in-person meetings, bringing together senior-level clients for a week of shared learning.

Why did you decide to launch this investment institute now?

The concept of an investment institute is something that Jenny Johnson, president and CEO of Franklin Templeton, had discussed for many years with Stephen Dover, who was previously Franklin Templeton’s head of equities. He was appointed chief market strategist and head of the institute when it was created in February. We have a unique structure of truly autonomous boutique investment teams. There is a tremendous strategic advantage in having these independent investment perspectives within one firm. With the acquisition of Legg Mason, we increased the number of specialist investment managers, and it felt like the right time to launch the investment institute.

You left your post as head of investment strategy at Martin Currie to become an investment strategist at the institute. What motivated the move?

I have more than three decades of investment experience spanning developed and emerging market equities. I joined Martin Currie in 2010 to develop its global emerging market capabilities as a portfolio manager and sector analyst before transitioning to become head of investment strategy in December 2019. My new role is a natural evolution of the work I was doing at Martin Currie — sharing investment insights on global themes — but it allows me to reach a much broader group of clients. I relish the intellectual stimulation I get from talking to clients and colleagues on issues that affect investors. I find interesting people everywhere and enjoy using my language skills. I am fluent in English, Spanish, Portuguese, Greek and French, with intermediate language ability in Russian, German and Italian.

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