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U.S. Bank Offers HNW Families Thematic Investment Exposure

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U.S. Bank’s Ascent Private Capital Management, which serves multigenerational families with $75 million or more in net worth, and Motif Investing, which provides thematic investing for individuals and financial advisors, announced a partnership last week.

“We believed that we needed to provide our clients with advice that’s long term in nature, and thus, we’ve developed a capability and a discipline that we call our thematic investing discipline,” Ascent’s chief investment officer Dan Rauchle said in an interview.

“In that context, we’ve developed knowledge around seven long-term themes that we think are going to play out over 10 years or more.”

According to Rauchle, Motif is collaborating with Ascent’s professionals on constructing a proprietary portfolio that is designed to benefit from each theme.

Work on two of the themes is nearly complete, he said, while work is just beginning on the others.

Rauchle ticked off the seven themes:

  1. Aging of the world’s population
  2. Expansion of the global middle class
  3. Reurbanization of America
  4. The U.S. energy advantage
  5. China transforming into economic adulthood
  6. Robotics
  7. Cybersecurity

“We continue to monitor and review the trends we’ve developed, and we continue to develop new trends over time,” he said.

If a theme plays out as Ascent’s assessment has suggested, Rauchle said, exposure to those investments will likely do better than the average market return.

How It Works

Rauchle said Motif has a research philosophy approach and capability that can help Ascent construct investment portfolios that are highly focused on its themes.

As an example, he cited the theme of global aging. The percentage of the world population 65 and older will grow massively over the next 25 years, from 8% at present to 16%.

Retired people will live longer than in the past, and will continue to consume good and services.

“One question is, what are the primary industries and within them the primary companies that will benefit from the aging population?”

Using proprietary technology, Motif can go into each company within a sector and analyze its product line, service offerings and earnings streams, and determine what percentage of that company’s overall revenue is driven by those who are 65 or older.

Ascent and Motif work together to construct investment portfolios or investment exposures that they believe will dominantly benefit from each theme.

Ascent then determines whether its client believe in the themes, are comfortable with them and would like some investment exposure that is consistent with those themes.

“When we talk to clients about investing in these portfolios, we encourage them to have the perspective that this is a long-term investment that should be in place for 10 years or more,” Rauchle said.

“There may some volatility on this investment over time, but that’s not what this investment is about. It about seeing a trend play out over long periods of time.”

Rauchle said the partnership with Motif “is a wonderful combination of a large firm that has a significant and trusted client base where we provide a very high level of touch partnering with a firm that has much more nimble technology capabilities.”


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