ABOUT THE 300

We are a group of leading investment professionals from across the globe, raising awareness of the potential impact of current market thinking and behaviours, and calling for immediate action.

OUR MISSION

The 300 Club is a group of leading investment professionals from across the globe, established in 2011 in response to an urgent need to raise uncomfortable and fundamental questions about the very foundations of the investment industry and investing.  

Since its launch, the mission of the 300 Club has evolved to concentrate on the purpose of investing and asset management, which is the creation and protection of wealth for asset owners and their beneficiaries.  However, we remain on the verge of a catastrophic pensions and savings crisis for multiple generations through a combination of the investment management industry’s lack of alignment with asset owners, vagueness about the certainty of many asset owners’ future promises, and low contribution rates.  The harsh reality is that many beneficiaries will risk retiring only just above the poverty line.

With climate change, geopolitics and macroeconomic factors rapidly changing the investment landscape, the 300 Club believes that we need to continue to challenge and change the mentality of the investment management industry and encourage investment managers to concentrate on the creation of value and wealth for the asset owner.

We appear to be at an inflexion point every bit as dramatic as the one that launched the basis of modern investment thinking in the early 1950s. The 300 believes that current financial and investment market theory and practice is very likely to fail investors at their time of greatest need.

Investment Trends and Related Problems

There is an increasing belief that complex and expensive financial models and investment structures deliver better outcomes for investors.

This thinking has severe limitations, particularly when stressed by market dynamics. These dynamics are likely to be atypical relative to market trends upon which these models and structures have been based.

Also, the high level of structuring and investment cost buried in these structures will invariably lead to relatively poor performance, irrespective of the market outcome.

The consultant-led best practice model of today does not serve our clients well.

Instead of a ‘beat the benchmark’ approach, we should provide the counsel to help investors, (private or institutional) achieve their real-world goals.
The advice we provide requires a holistic view of the challenge. This takes the industry away from being component part suppliers to a much more rewarding and valuable (to the end client) role.

For 50 years, markets have encouraged the view that a “risk-free” baseline exists and that markets will always rise. These are false and very dangerous assumptions.

History has shown that countries, governments and markets are far from risk-free. Over- reliance on maintaining the status quo is likely to prove extremely costly to those who ignore the potential ultimate impacts of emerging instability.
Much of regulatory and “fiduciary” conduct is driving investors towards so-called “risk- free” behaviour. This happening while the evidence points towards these strategies being far from risk-free, is a testament to the folly of current collective wisdom.

We might not be able to offer all the answers, but, like the original 300*, we hope that by our actions we can raise enough awareness of this threat and allow the industry time to realign itself to meet the challenges and minimise their ultimate impact on the end investor.

*The “300” refers to the legendary 300 Spartans who in 480 BC held off the vastly numerically superior invading Persian army at the Battle of Thermopylae to give sufficient time for the remaining Greek forces to regroup. The story of the 300 has become a symbol of what can be achieved by a small band of high conviction individuals against overwhelming odds.

Conclusions

The above trends are likely to have material adverse consequences for investors. Together they represent an unprecedented convergence of flawed market theory and misaligned behaviours, with all the ingredients to create a “perfect storm” for investors and the economies in which they operate.

ONE

The consequences for markets is the herding of investors into increasingly overpriced assets with the false promise of de-correlated return or lower risk.

The basis of these fashionable products and the basis of most modern models that assume a risk-free
baseline is equally flawed. Coupled with this, the orchestrated shift of investor interest away from “risk
capital” is a major blow for Western economies. They desperately need investment capital to help regenerate their competitiveness and restore the health of their accounts.

TWO

The irony of the situation is that current trends reflect an ambition to recognise, measure, manage and minimise risk.

This focus is not just a knee jerk reaction by individual investors to perceived greater risk and uncertainty. It is in the thinking of regulators of investment markets across the globe, in strategies pursued by major investing institutions and in the sponsors of Pension Funds and their advisors.

THREE

Recent economic and investment trends will change the investing landscape over the next two decades. We are at a turning point which presents huge risks for ordinary savers.

The 300 formed to address an urgent need to raise the difficult questions about the very foundations of
the investment landscape. “We might not be able to offer all the answers, but, like the original 300*, we hope that by our actions we can raise enough awareness of this threat and allow the industry time to realign itself to meet the challenges and minimise their ultimate impact on the end investor.”

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