1. 46 1 Investment Week 1 21 March 2011
CHIEF EXECUTIVE INTERVIEW
In ashort space of time as CEO of Matrix Asset Management, Angus Wool house tells Emma
Dunkley how expanding the group's distribution capabilities has been essential to navigating
Matrix in the right direction
WOOLHOUSE BRINGS FRESH
DIRECTION TO MATRIX ROLE
After only a couple of months at the helm of in Hong Kong, where he was responsible
Matrix Asset Management, chief executive for developing mutual fund sales across the
Angus Woolhouse is already steering the Asia Pacific region. "It was a pioneering role,
firm in a clear direction. One of his first pri- bringing HSBC Asset Management's manufac-
orities in the newly created role he took on last turing ability to bank distribution for the first
December was to expand Matrix's distribu- time, when Hong Kong and the whole of Asia
tion capabilities, by offering a broader range of Pacific was growing really fast."
products to a wider network of investors. After gaining experience in the institu-
"One of the first things I wanted to do tional and retail spheres, Woolhouse main-
when I arrived was to reinforce to everyone tains he was lured to the CEO role at Matrix,
asset management was one division - there rather than pushed into the position by
were areas of crossover between the prod- Gartmore's ailing business. "The opportunity
ucts we make and our distribution networks. to effectively run your own business and be
We needed to reorganise ourselves as one responsible for 95 people and a £3.25bn asset
division, rather than as a series of individual management firm was too exciting to turn
groups," he said. down. What happened at Gartmore is just
With over 25% of the local authority mar- what happened- I had gone by then."
ketplace as clients and an established rela-
tionship with the major intermediary groups Growth roots
in the UK, Woolhouse aims to leverage upon As an asset management firm with roots
the firm's existing investor base to grow the in pioneering tax-structured products for
business. "What I would like to do is move intermediary distribution, Matrix appealed
to a broader, full service offering, so these
groups and distribution channels are aware of
Matrix's full potential. This is an opportunity "One of the first things I wanted to do when
we can now really leverage."
Woolhouse is not just limiting his vision to I arrived was to reinforce to everyone asset
the UK. As part of his ambitious expansion
plans, the CEO is keen to push the firm's dis-
management was one division ... We needed
tribution capabilities to Europe and Asia,
while seeking to hire a raft of new managers as
to reorganise ourselves as one division,
part of the process. "I am very keen to recruit
and attract good fund managers, particularly
rather than as a series of individual groups"
in the absolute return hedge fund and UCITS
space. We are looking for managers that cover to Woolhouse thanks to its retail-based
UK long and short absolute return, pan-Euro- offerings and the opportunity to grow the
pean absolute return, and macro." business. Established in 1987, Matrix was a currently manufacture, then there is a very
pioneer in the venture capital trust space, compelling argument that says you can con-
Finn objectives which no-one else was offering at the time, tinue to satisfy your clients needs, but you
Having set out his plan after only 12 weeks in he said. do it via somebody else's products."
charge, Woolhouse has certainly cemented "It then evolved very quickly from being a
his position back in the retail arena. Prior to dominant player within that narrow product Capital preservation
joining Matrix, he was running the global space, as the group understood it could lev- In 2006, Matrix shifted from its core VCT
institutional business at Gartmore, providing erage its expertise across broader-based offering towards absolute return hedge
long-only funds and hedge funds to some product lines. It then looked at investment funds and UCITS III funds. "We realised
of the largest pension schemes around the banking, property and a range of different retail wanted absolute returns and the prin-
world. "I was at Gartmore for seven years until investing options, although its core business ciples of capital preservation, but in a regu-
December 2010, which was fantastic, despite has always been intermediary distribution." lated UCITS III format. That is really what
what sadly transpired at Gartmore." Matrix has a dual strategy in terms of dis- the group has focused on in the last 18
His tenure at Invesco Perpetual before tributing internally manufactured products months to two years." Of Matrix's £3.2bn
Gartmore gave Woolhouse experience in and those from third parties. "The benefits assets under management, hedge funds now
building newly merged brands. "I joined of both manufacturing and distributing your account for around £657m. Matrix's assets
Invesco in 1999 and was involved in the Per- product have always been understood. But are also up over 25% year on year.
petual acquisition - running products and Matrix has been clever and led the market "VCTs are designed to reward investors
marketing them across Invesco in the UK, in understanding if you cannot make a who are prepared to put money into compa-
dealing with all the integration challenges, product, distribute those made by others. nies in need of capital. Banks' lending has
establishing the brand and really leveraging If expertise lies outside then distribute it been constrained over the last two to three
some of the positive attributes of the busi- to the intermediary community, where our years, therefore private investors have been
nesses at the time of a massive acquisition." relationships are strong. No-one else has
During his stint at Invesco Perpetual, Wool- really done that."
house worked with Mike Webb, now CEO of This model has enabled Matrix to estab- BIOGRAPHY
Rathbones, in amalgamating two disparate lish some strong long-term partnerships e Joined Matrix in December 201 0 as CEO of Matrix's Asset Management
product ranges into one set, while retaining division. Prior to joining Matrix, was head of global institutional business at
with groups that were not otherwise able
the key fund managers. "This was my first Gartmore.
to access a mass market retail audience.
• Was previously group marketing and product development director at lnvesco
exposure to UK retail, the broader interme- "We provide product structures that enable
UK, where he was responsible for marketing and product strategy across all
diary market and the needs of IFAs." retail investors to invest into some of these distribution channels.
Woolhouse first learnt his trade in new firms. If you have got strong distribution • Held a number of senior marketing positions at HSBC Asset Management,
product development at Pepsi from 1990 to relations, a commitment to the IFA market- based in Hong Kong.
1993, followed by a period with HSBC based place and demand for products you cannot

2. lnvestmentWeek 21 March 2011 47
CHIEF EXECUTIVE INTERVIEW
MATRIX ASSET MANAGEMENT
e Funds of funds • Cash funds
• Hedge funds e Investment management
e UCITS funds e Private equity and VCTs
e Structured products e Specialised finance
FUND RANGE
e Matrix Asia fund, focused on Asian markets.
e Matrix Macro fund, a global macro equity fund.
e Matrix New Europe fund, focused principally on the markets of Russia,
Poland, Czech Republic, Austria, Greece and Turkey.
• Matrix PVE Global Credit fund, focused on global credit markets.
• Matrix Redux EM fund, a macro fund focused on emerging markets.
KEY FEATURES:
e All funds are domiciled outside the UK and listed on the Irish Stock Exchange.
e Appropriate for a SIPP, expert or institutional investment.
e $100,000 minimum investment.
e Fund manager is authorised and regulated by the FSA.
MATRIX ASIA UCITS FUND
e Asian equity long/short fund - typically holds 40-60 stock positions.
e Focus on Japan and China as the two main markets, but also includes Korea,
Singapore, India and Taiwan.
e High conviction fund with a thematic and macro overlay.
e Focus on adding value through the short book.
e Rupert Foster has 16 years investment experience in Japanese and Asian
equities, seven of them as a long/short fund manager.
))FOR MORE ON MATRIX ASSET MANAGEMENT
Search www.adviserhound.com
Capital preservation
Despite a definite thirst fo r income among
investors , Matrix does not offe r income
products , choosing to focus on absolute
r etu rns . "One of th e mos t impor tant prin-
ciples du rin g t imes of market stress and
volatility is th e p ri ncipal of capital sta-
bility. We ar e looking to preserve our cli-
ents' wealth at a t ime wh en I t hin k we are
going to se e equity markets undergo some
volatility over the next 12-18 months."
"I think rising commo d ity prices ar e
now really fully being u nderst ood by con-
sumers, becau se the price of food and
petrol among other things has accelerated
t he largest source of available capital to third of returns from the short book. A lot to such a degree that, on top of t he reduc-
companies desperate for cash flow. The gov- of fund managers just buy the index or tion in d isposable income , you feel you
ernment has a responsibility to continue to shor t the index- they do not short the indi- ar e caught in a vice. The macro environ-
provide some sort of incentive for investors, vidual physical stocks. It is clear which sec- ment in t he UK is going to be ch allenging
so I do not see the VCT product as coming tors will do well and which will not do well, over th e next 12-18 months, I do not see
under pressure." in r esponse to some of the broader macro t hat stopping, but if people are prepar ed
The firm's number one product is its Asia themes we see in the emerging markets. to make investment positions, I th ink Asia
UCITS fund, a long/short hedge fund covering "We like Asia a lot, because GDP forecasts presents a much broader opportunity."
Asian equities, including Japan. The fund is across the region are still at 6.5% and we think Along with Asia, Wool h ouse is bu llish
a high conviction product that has delivered it is a very exciting area for us to be focused, on his ability t o grow Matri x 's asset man-
16.7% per annum in annualised returns since both as a business, and in terms of the fund." agement arm in the role of CEO. "Eve-
inception in 2008. For those investors looking for genuine ryone h ere recognised they ne eded a CE O
"We have just concluded a significant seed growth opportunities, Woolhouse remains for asset management and that there was
deal with a leading European institution. As committed to the Asia growth story, so much a lot of potent ial within t h e division but it
the fund grows - it is now over $100m in size - so, Matrix is planning to open an office in n eeded to b e harnessed. On e of the fi r s t
it starts to gather momentum. We spent a year Hong Kong. things I h ave done is reinforce internally
really marketing the Cayman and the UCITS "This is something we are working on now to ever yone ther e is a real opportunity to
version of the fund and we are now about to - it will predomin antly be an investment be able to leverage what is the most uniqu e
move to daily dealing, which is a very impor- office for Rupert Foster and his team, and manufacturing product development capa-
tant attribute for the retail client base. Daily over time, it will evolve t o become more of a bility I have come across in my career.
pricing makes the product more like a passive distribution arm." "We have m or e sophisticated product
unit trust product - we will be doing this by In a broader sense, Woolhouse said he has creation skills in th is fi rm tha n anywher e
the end of March." concerns about rising inflation, a commodity else I have worked. But where we have per-
Woolhouse added Matrix is in discussion bubble forming and the impact of the deficit h aps faile d historically is being able to lev-
with key platforms including Towry Law, on UK households, all of which could drag on erage those skills to the broadest possible
Standard Life, Skandia, Hargreaves Lansdown economic growth. distribution audience."
and Bestlnvest to offer its Asia UCITS fund to While there are many views on when He added: "I was attracte d to Matrix's
retail investors. interest rates should be raised, Woolhouse diversified fin ancia l ser vices group ,
The fund's manager, Rupert Foster, is believes the full impact of the deficit reduc- with its pr op erty busin ess, investmen t
one of the few that can derive alpha from tion programme, on everyth ing from goods b anking business, and as set m anagement
the short b ook, said Woolhouse. "He is as and services to disposable income, will really business . Strategically, it is so important
aggressive in the stocks he does not own hit within the next six to eight months, which for a group to h ave three strong legs to the
as the stocks he does - he used to make a could corrode confidence. same stool."