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Money matters: Big is Best? Part 1
Graham Macdonald
MBMG International Ltd.
Analysis
We were recently asked to analyse UBS Absolute Return - a range of funds and
private banking portfolios offered by UBS to its clients. Its aim is to achieve
“Stable returns regardless of the market environment”.
A more detailed point by point analysis of UBS’s Absolute Return portfolios is
available upon request. However, the analysis started us thinking in general
terms about the value added by private bankers versus intermediaries. The need
to qualitatively re-evaluate our business processes from time to time is
extremely valuable, not only for us but also our clients as well.
Other than measuring success by investment performance or by our own business
performance, which are both by nature historic, this qualitative approach is the
best indicator as to whether we’re remaining sufficiently adaptable to client
demand.
UBS Absolute Return
Basically UBS Absolute Return replicates in many ways the approach
that we suggest taking to investment - since the turn of the millennium we have
been using a presentation called ‘Risk Adjusted Investments’ that covers many of
these same concepts. It would be hypocritical of us, therefore, to do anything
other than endorse these concepts and welcome UBS belatedly aboard!
We have a long record of offering these types of portfolios. In the first 5
years, in its most defensive and most liquid format (this most directly equates
to what UBS call their Defensive Absolute Return Portfolio - the value of the
portfolio shouldn’t fall, it should be extremely secure) we have achieved
returns of 10.32% - 14.77% per annum in a range of currencies including USD,
AUD, NZD, CAD, EUR, CHF, GBP, JPY and Baht. Also, we now offer discretionary and
fixed hedging into all tradable currencies.
Investment Philosophy
Although the stated investment philosophy of UBS Absolute Return
Portfolios is similar to MBMG’s risk-adjusted portfolios, there are some
important differences between MBMG’s approach and that of UBS:
- We try to be ‘closer’ to our clients in terms of understanding their
requirements and we try to offer more ‘bespoke’ solutions, creating a portfolio
individually designed for each investor specifically to suit their requirements.
Individual investor needs, invariably, contain as much uncertainty as life
itself - successful portfolios need to be constructed around the client in terms
of liquidity, consistency, currency choices, flexibility and risk appetite. The
biggest difference in emphasis is that we would say that these portfolios,
whoever we happen to use to create them, are just a tool, a building block
towards a solution.
UBS appears to ask their clients to choose whichever currency suits best from
Sterling, US Dollar, Swiss Franc and Euro.
Quite apart from the number of currencies that this excludes and quite apart
from the fact that this is inflicting the task of currency management back on
the client and quite apart from the fact that relative currency merits will
change, UBS is asking clients to make a one off choice and to live with it. This
is extremely restrictive. A client has to act as the currency manager of their
own portfolio - and with only a very limited set of currency tools.
MBMG, on the other hand, provides portfolios fully hedged into any tradable
currency - if Thai baht is the client’s base currency we can provide a portfolio
fully hedged into baht. We also offer fully discretionary hedging - we wouldn’t
absolutely hedge into baht at ALL times. We’d only use hedging to protect baht
value during periods of actual or apparent baht strength. Therefore, when
clients have needed to withdraw funds at any stage, whether in their base
currency or in any other currency, the results have always been extremely good.
In an age when sufficiently sophisticated tools exist to remove or hugely reduce
risk and enhance return, to match liquidity to each client’s requirements and to
ensure absolute flexibility, the ‘one size fits all’ solution typified by many
Swiss private bankers is an extremely disappointing anachronism (strictly there
are 3 portfolios so actually it’s more like 3 sizes fit all. However, choosing
between growth, balanced and income is still like only being able to choose
shoes that come in Large, Medium or Small).
Private Banking
We are of the view that traditional approaches to private banking are
increasingly out of touch with the demands and the opportunities of the world
that we live in. Historically, the idea that your local bank manager would
recognise that your deposits had become sufficiently sizable that you were
sitting on too much liquidity and that it would be more efficient to invest a
proportion of this into higher yielding, less liquid investments was extremely
valid. The difficulty of accessing alternative resources to do this at local
level made this service even more valuable, as did the fact that your bank
manager no doubt had a good understanding of your needs and requirements. For
expatriates today the good news is that these services are ever more readily
available - the bad news is that these needs are becoming ever more complicated.
Continued next week…
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The above data and research was compiled from sources believed to be
reliable. However, neither MBMG International Ltd nor its officers can accept
any liability for any errors or omissions in the above article nor bear any
responsibility for any losses achieved as a result of any actions taken or not
taken as a consequence of reading the above article. For more information please
contact Graham Macdonald on [email protected]
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Snap Shots: Camera shake and some tips
by Harry Flashman
 “Shake
and shake the ketchup bottle, none’ll come and then a lot’ll”. Those
immortal words from Ogden Nash are probably not relevant to camera
shake, but the end results are the same. Not what you wanted!
With today’s Point and Shooters which are so small they can practically
fit in one hand, the tendency is to do just that – one handed
photography! Let me assure you that one handed picture taking may look
sharp, but the end result photograph won’t be as sharp as you wanted.
With the larger cameras, SLR’s and the like, it becomes even more
important to avoid camera shake. After all, why spend thousands of baht
to buy super sharp lenses and get soft “blurry” photographs. You might
as well have stuck with a cheap disposable “camera in a box” and saved
your money for alcohol – which will also give you the shakes just as
easily and possibly more enjoyably! By the way, do not be fooled by the
small viewing screen on the digital cameras. It is too small to really
see whether there is camera shake, or otherwise.
The simple fact of the matter is that to get sharp photographs, the
camera must be held still while the shutter is held open. Now, in most
daylight situations if the camera is set on “auto” it will select a
shutter speed of around 1/125th of a second, and while that sounds
“fast” it really isn’t. You will still get noticeable “softness” in the
final print if the hand holding the camera has allows any movement.
The secret really is in the grip. And it is a two handed one, even for
the digitals. You will not see any professional photographer taking
shots with one hand, while waving the other in the air and saying, “One,
Two, Three” (or even “Neung, Song, Sam!”). Your camera will most likely
have two “hand/finger” impressions on either side of the camera body.
They are not there for decoration. Use them!
Camera Straps
I was stimulated to write about this after a friend of mine showed me
his new Nikon D70. Straight out of the box, and with no camera strap in
place. I counseled him to attach one immediately! Dropped cameras do not
do well.
Another trap for the unwary amateur photographer is the dreaded camera
strap in the photo routine. Ever got prints back with a strange blurry
dark shape running across the photo? That was the camera strap hanging
down across the lens when you took the shot. With Point and Shoot
compact cameras you will not see this when you look through the
viewfinder, because you are actually looking through a separate viewing
lens system, not through the main camera lens itself.
The answer for this type of problem is to wear the camera strap around
your neck at all times when taking the shot. This way it will not fall
down across the lens. When you are walking around, and prefer to keep
the camera in your hand, then wrap the strap around your wrist. The idea
of having the strap is to stop the very expensive, very delicate camera
falling on the ground where the concussion kills it or into the sea
where it dies a rapid death by drowning.
Camera straps are an important item, not just an advertising space for
the camera manufacturer. Use them!
Skylight Filters
A filter on the end of your lens makes good sense. It protects the
optical glass elements (the glass goodies you paid the big baht for) and
does help your sky colors as well, by removing excess UV light. Use
them!
Lens Caps
These are another frequently ignored, but important pieces of camera
equipment. The quality of the camera’s optics dictates the ultimate
quality of your photographs. The bit of glass at the end of your lens
can ruin the end result if it is not clean, or worse still, if it is
scratched.
This is the reason that you should keep the lens cap on the lens when
the camera is in the bag or not being used. If you tend to lose them you
can always attach a piece of string to it and tie it to the camera. Use
them!
Modern Medicine: Dosage alone determines poisoning
by Dr. Iain Corness, Consultant
Dosage alone determines poisoning, seems to be rather obvious
for some, and rather obtuse for others. That concept was spelled out many
centuries ago by Paracelsus (1493-1541), more properly known as Theophrastus
Phillippus Aureolus Bombastus von Hohenheim (so you can see why he adopted a
somewhat shorter moniker), who was born in Einsiedeln, Switzerland.
In the popular press world-wide, there has been some fairly harsh words
printed regarding the “safety” or otherwise of some of the artificial
sweeteners available over the supermarket counters. Whilst the scientific
data may have been correct in principle, the effects do not necessarily or
absolutely make themselves evident in homo sapiens, the ape that learned to
walk on its hind legs. Us!
The very wise physician, Paracelsus, came up with the scientific principal
of “Dosage alone determines poisoning,” and he was correct and he is still
correct. In other words, some compounds which may cause adverse effects in
high dosages may actually be quite innocuous or even beneficial in low
doses.
Take for example one of the finest drug entities that mankind ever found –
aspirin – a salicylic acid compound. This drug will get rid of most
headaches and other minor pains, lower raised temperatures and decrease
inflammation. No wonder aspirin has stood the test of time. However, if you
look up scientific texts you will also find that aspirin can cause
gastro-intestinal tract irritation, bronchospasm (asthma), bleeding into the
gut and an increase in bleeding time – and that is in the higher but still
therapeutic doses. Increase the dose beyond the therapeutic and the
principal adverse effect can even be death.
So on one hand you have a drug that has saved lives – and on the other it
has killed people. What was the difference? It was simply the dosage.
Taking poor old saccharin as another example; this artificial sweetener was
banned in the United States as it was reported to be cancer producing – and
it certainly did. The cancers it produced were discovered in laboratory rats
at a dosage equivalent to you and I stuffing thousands of tablets down our
throats every day. Fortunately, the scientific world eventually remembered
that man is not a large rat and worked out that we did not have enough time
each day to swallow thousands of saccharin tablets and removed the cancer
producing label.
Another interesting chemical is one called ethanol. This little beauty can
cause convulsions, coma and death – and if we forget about Paracelsus’ wise
words, we should ban it immediately. This is the kind of knee-jerk reaction
which unfortunately is all too often seen in today’s panic stricken world. I
would not support a ban on ethanol, even though it produces lots of other
lingering pathological conditions as well. I just happen to like a nice wine
with my dinner or a beer after work on a hot day. You see, ethanol is the
principal ingredient of alcohol, no matter which fancy labeled bottle it
comes in. In low doses it can lower blood pressure and lessen the risk of
heart attacks – but in high doses causes cirrhosis of the liver as well as
the aforementioned convulsions, coma and death! Once again – dosage alone
determines poisoning.
So even though I do agree with the principal that “natural” is better in
many cases, I do not on the other hand believe that popping an artificial
sweetener in one’s tea today will lead to Alzheimers Disease tomorrow, next
week or even in the next three decades. However, I believe it will keep
giraffes off your front lawn.
Fortunately I do not have to worry, as I always did take sugar!
 Heart to Heart with Hillary
Dear Hillary,
Why do so many of your male correspondents think that sexual intercourse is
the most important thing in their lives? Their whole focus on life is sex,
and it seems that it is the major event to keep them going. I thought men
were supposed to slow down after a while, but it seems that Viagra has
perked up their interest to the stage where they must be an embarrassment to
everyone around them, even though they cannot see it. They talk about their
relationships with Thai bar girls as if they were conquests, but in the ‘pay
for sex’ business there is no contest. Or do they forget this, or blot it
out from their consciousness? Is it the male ego, or is it peer pressure?
This constant need to perform and brag about it interests me. Is it the same
all over the world, or is it something that just happens here? Do you have
any thoughts in this direction, Hillary?
Enquiring Edith
Dear Enquiring Edith,
Whether we like it or not, my Petal, men do seem to equate masculinity with
their ability to perform. It used to be that the ability to procreate was
what indicated virility; for example Charlie Chaplin was still fathering
children into his 90’s, but these days with contraception and Zero
Population Growth (and condoms), for these men, their virility is only
expressed by their ability to talk about their exploits. Something like the
fishermen loudly lamenting the ones that got away, the bordello braggarts
boast of the ones who did not get away, ignoring the fact that the prey was
not running, other than to the bank or the gold shop. “Nailing them down” is
a phrase used which has an obvious allegory associated with it. I believe it
is a phenomenon that exists all over the world, hence the global sales of
Vitamin V, but the actual situation is probably closer to the surface here
in Thailand than it is in some of the more conservative societies. Quite
frankly, I don’t consider it to be a crime, Edith, or if it is, it is a
victimless one. It is really neither contest nor conquest. Let the males
continue with their self delusions, while the bar girls continue to send
money back to the villages and buy motorcycles. It helps the economy, I
suppose.
Dear Hillary,
At lunchtime or in the afternoons I often stroll through my local shopping
mall, and I have noticed a rather dishy young lady sitting there every day.
Usually she is on her own, or maybe with a girlfriend, but she always gives
me a big smile. I have also seen her talking with some foreigners even older
than I am (I am 67 by the way), though it looks to me like she is just
passing the time of day, or even giving them advice on something Thai. (She
is Thai, I am sure of that, even though she has curly hair.) Now I don’t
want to make a fool of myself here, but do you think she is looking to make
further contact, or is this just the usual Land of Smiles stuff? I have not
been here very long, and am on my own, my wife having died several years ago
back home. I am tempted to talk to her, but as I said, I don’t want to make
a fool of myself in public. Hope you understand.
Carl from Carolina
Dear Carl from Carolina,
I can understand you not wanting to make a fool of yourself in public, my
Petal, so you would rather make a fool of yourself, hiding behind a
pseudonym! Carl, let me take you to one side here and whisper a few things
in your ear, where nobody can hear us. Why do you think this “dishy” young
lady is there every day? Why do you think she is smiling at elderly farangs?
Where do you think she gets the money to live every day, sitting in a
shopping center and obviously not holding down your regular 9-5 job? Do you
think that some hairdresser will perm her hair for nothing each month? In
this country, she is also certainly not a supported pensioner. There is no
Social Security in Thailand, the way there is in your country. What you have
to understand is that not everyone who wants an ATM of their own works out
of a bar. There are other areas where lonely foreigners can be found. Cash
cows lining up in the stalls, eagerly looking for places to be milked and
people to milk them, and shopping centers are as good as anywhere else.
However, there is nothing to be lost by making contact with your smiling
goddess. You can always leave your watch off and sit down beside her and ask
her if she has the time. If she says “2.30 p.m.” then she just might be
resting each day and nothing else, but I think it more likely that she will
say “Short time or long time?” after which you can either run away as fast
as your 67 year old legs will carry you, or just open your wallet and say,
“Help yourself.” Beware, Carl from Carolina. Hillary has warned you.
Beyond the Beach: “Divided by
a Common Language?”
Caspian Pike
I had been looking forward to “Beyond the Beach” from New York City for some
time. I’m lucky to get a sneak preview - one of the perks of the job - and I
wasn’t disappointed. One of the first things Andrew Watson does is ask a
question that was lurking in the back of my mind - an uncanny knack of his. “Who
funds this show?” he asks, with a wry smile. It’s a good point. He’s on the
other side of the world, after all. Typically, of course, he leaves the viewer
hanging, before being swept away by the pace of life in the ‘Big Apple’.
Andrew provides a taste of the ‘Big Apple’ in this week’s ‘Beyond the Beach’.
In the land of Walt Whitman, Mark Twain, Bob Dylan, Spencer Tracy, Marilyn
Monroe, Martin Luther King, BB King, Beyonce, Bill Haley, Halle Berry and er,
George Bush, Watson’s quest is to test George Bernard Shaw’s assertion that “The
Americans and the English are a common people divided by a common language.”
Here, in the shadow of liberty herself, he stands, a small fragment of humanity,
a grain of sand in the universe of mankind, wondering whether linguistically at
least, (to borrow from one of America’s great literary geniuses, Edgar Allen
Poe) the pendulum swings both ways? Or maybe, Watson conjectures, “it’s just a
state of mind?”
Of course, it is immediately apparent to anybody who visits New York City, that
it’s a veritable salad bowl of cultures and languages. So whilst English might
be the official first language of the United States, for many of the population,
it is the second or even third. It is with this knowledge in mind that Watson
tracks down a cross-section of America’s finest with subtle irony.
In the centre of Times Square, the heartbeat of America, Watson discovers
someone who is a fabulous caricature of my idea of an American. Someone larger
than life, an individual so outrageous that the phrase, “Beyond the Beach” seems
to sum him up! He’s a six foot four cowboy, sporting only graffitied white
underpants, Stetson, a guitar and a smile. Completely “BYB”! In conversation,
however, this self-proclaimed “Naked Cowboy” comes across as sensitive,
intelligent and articulate. Frankly, it’s not what you expect.
As Watson meanders through the streets of New York City, he makes a solemn
pilgrimage to ground zero. It’s a moment of serious reflection which brings home
to the viewer the ‘new reality’ in which we all live, since 9/11.
Naturally, Watson doesn’t leave us ‘down’ for too long. Other sage barometers of
linguistic inconsistencies include the ubiquitous new immigrant taxi driver and
a collection of rather attractive young ladies. It’s a bold and adventurous show
which left me with a feel good factor and PMTV deserve a great deal of praise
for having the courage to write and produce programmes like this.
Catch Andrew Watson’s trip to New York City, “Divided by a Common Language?” on
Sunday, at the following times:
Sophon at 8:00am - Midday - 4:00pm - 8:00pm and Midnight.
Chonburi at 9:40am - 2:00pm - 8:40pm and 40 minutes after midnight.
Jomtien at 9:00am - 12:30pm - and 9:00pm
Sattahip at 8:00am - 1:30pm - 5:00pm - 8:00pm and 11:00pm
A Female Perspective: Postcard from Rome
with Sharona Watson
It takes a lot to drag me away from my beautiful home in a land which feels
more and more like a real home every day. I love Thailand. It is a place
where I can feel safe and happy, where even the bad things that happen (I
won’t mention any driving incidents) seem much more bearable, somehow. I’m
going to be forty in a month (more about arriving at this crossroads next
week) and I’ve known for a while that my husband has been up to something. I
just didn’t know what. He has to be just about the worst person I have ever
seen at concealing something. His character changes; he becomes quiet and
mills around doing things that usually he wouldn’t even think of doing. So
it was last week, when he started cleaning the house, arranging things here
and there, popping out mysteriously and returning a short while later,
putting on this idiot’s face when I ask him what he’s up to and refusing to
meet my eye.
 At
the Tivoli Fountain in Rome; almost overwhelmingly romantic.
It didn’t take me long to locate a cooler full of drinks, hidden next door.
Ok, so we’re going to have a party. Great! Sure enough, after a while, my
friends started arriving. Then a wonderful cake, with ‘Happy Birthday’
inscribed with icing, in Hebrew. I must say, it was the most wonderful
surprise. But the best was yet to come. Andy got everybody quiet and started
one of his speeches, which can sometimes go on for hours. Happily, this one
was much shorter and was concluded by my daughters presenting me with an
envelope. Inside were air tickets to Italy and Israel. I was in shock. It
was the best present I have ever received and a complete surprise! At
moments like this I sometimes feel that I shouldn’t write such harsh things
about my husband. But the feeling passes quite quickly.
Italy is one of the few places on earth that I would willingly tear myself
away from Thailand to visit.
We arrived in Rome the morning after Italy had won the football World Cup
and there was a carnival atmosphere everywhere. What a city! Laughter,
smiles, animated discussions, the hustle and bustle of a great European
centre, the heat without the humidity; beautiful! And the men! They are all
so incredibly well-groomed! Even the bus drivers look like film stars,
dressed perfectly in close fitting shirts and trousers, with swept back hair
and dark glasses. I had to comment on the way the men looked, to Andy. He
frowned. I think the reason that they look after themselves so well is that
it’s an ‘outdoor’ culture. The climate allows and encourages them to spend
most of their lives outdoors. As a consequence, they become more conscious
of themselves and looking after their appearance becomes a habit, a good
habit. You only have to walk around Rome to realise how important clothes
are to Italians. The place is absolutely full of high fashion stores of
clothing, shoes, perfume and accessories. A shopper’s paradise! (Except try
finding something practical and you’ll have a tough time, I think!)
It’s a city that is incredibly easy to travel around in. Public transport is
cheap, reliable and regular. Trams, buses and the metro combine to make
getting around fun. When you tire of walking you just jump on a tram, which
will inevitably take you past monuments of great historical significance, on
your own personal journey through the past. Here, you can let your
imagination wander. The Italians’ attention to detail is wonderful to
behold. It’s as if Roman efficiency has become part of their souls.
Centuries of evolving fashion are embedded into their psyche and are moulded
to the facades of their buildings. The light is brilliantly clear; the
colours of the constructions reflect the passion of the people. The shadows
cast on the paved paths are intense and deep, as if they have been painted.
Magenta bougainvillea hangs from flowerbeds along balconies and a thousand
scents from a thousand different sources ease their way into my senses.
Shops are tucked under arches with vaulted ceilings, restaurants
proliferate, overflowing onto the pavements, where Romans and tourists as
one, indulge in the art of people-gazing.
I love the sense of celebration of life in Rome. If it’s good to eat, then
it’s better still to bathe in the ritual of it all. The waiters and
waitresses have service down to a fine animated art; it’s as if they are
acting out roles in a Felleni film. They love children (like in Thailand)
and there’s no sense of the ‘get your children to behave!’ that you get in
some countries. Funny that, when they’re not constantly scolded, they seem
to behave better anyway?
And the Gelati! (Ice cream) The Italians haven’t acquired their reputation
for having the best ice cream in the world by accident. Even the
presentation of Gelati is like a kaleidoscopic art-form and the flavours are
as imaginative as they are utterly addictive. The limone (lemon) sends a
shiver down my spine. The fragola (strawberry) tingles on the tongue.
Combining the two is an almost erotic experience … which leads me to the
feeling I get most of all from Rome. More than Paris, more than New York,
more even than Florence, I find Rome almost overwhelmingly romantic. Making
a wish as you throw a coin into the Tivoli fountain, soaking up the baroque
delights of the Spanish steps, drinking cappuccino at a pavement café; it’s
all unbearably lovely. We rented a battery powered four-seater bicycle in
the Villa Borghese and roamed in and out of tree lined avenues. I haven’t
laughed so much in years. Rome makes you smile. There we were, together as a
family, having the best time, living moments that will be frozen in my
memory forever. I looked at my children laughing and my husband’s bright
blue eyes and thought to myself, “If this is what being forty is going to be
about, then “bring it on!”
Next week: “Forty? Bring it on!”
[email protected]
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