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Porthos to D’Artagnan: "You, boy, are arrogant, hot tempered and entirely too bold. I like that. Reminds me of me" |
THERE IS A thin line between supreme self-confidence and arrogance. And where arrogance would normally be seen as an unwelcome characteristic, in the world of fund management, self-confidence – having the courage of one’s convictions – is a prerequisite.
As a trader in a London investment house says: "All the fund managers in our place are completely full of themselves. But then again, that’s what makes them successful."
Raphael Kassin, the new head of emerging markets fixed income at Credit Suisse, is clearly well endowed with self-confidence. But his clients, and his peer group, will see this as very much a strength.
Entirely at ease in front of the photographer’s lens, Kassin is not shy of the spotlight. Although many large fund houses have gone out of their way to emphasize the benefits of teamwork and a collective, inclusive decision-making process in their investment culture, the star fund manager, as embodied by Kassin, is still very much alive and well.
Given his track record over nine years at ABN Amro, which he left in April, he has no reason for self-doubt. His dollar-denominated fund, from 1999 up to his point of departure, grew 300%, with no full-year losses. That compares strongly to a 204% return in the same period for the JPMorgan Chase EMBI benchmark.
Following his departure from ABN in April, Standard & Poor’s immediately placed the fund under review. Clients voted with their feet and by July had redeemed about $4 billion, nearly 50% of the total assets. With the fund’s performance so strongly based on Kassin’s decision making, it was no surprise they would want to move their money where he went.
Early ambitions
Right from his first days on the buy side, Kassin was prepared to test himself against the biggest names in his field.
Robert Kyprianou, now chief executive of Axa Framlington, was the head of fixed income at ABN Amro Asset Management who brought Kassin into his team. Kassin remembers his brief from his boss.
"He said to me: ‘I want you to become the Mark Mobius of bonds’, – and I like to think that I did that for the most part."
Mobius, executive chairman of Templeton Asset Management, is a living legend in emerging markets, indeed Kassin is inspired by such names. Indeed, mention his peers in the asset class, such as Mohamed El-Erian (who is returning to Pimco after a stint as chief executive of Harvard University’s endowment fund), or Jerome Booth and Jules Green of Ashmore Investment Management, and Kassin’s eyes light up. "Those are my favourite competitors," he says.
If Booth, El-Erian and Simon Treacher of BlueBay Asset Management are the three musketeers of emerging market debt, then Kassin makes a good D’Artagnan: the latest to join the elite of investors in this asset class.
The 42-year-old was born in New York but raised in Brazil, although he returned to New York to study mathematics and economics at Cornell University and then took an MBA from New York University.
His career in finance started at Sakura Bank as a money market trader. He moved to Chemical Bank as a trainee in emerging market fixed income in Susan Segal’s team before joining ABN Amro in Amsterdam as an emerging market bonds trader a year later. Then came the call from Kyprianou to switch to the buy side. "Robert made me a very nice offer," he says. "The idea was to create a fund, a winning track record and then an institutional business."
Nine years on, with funds built up to some $9 billion, Kassin decided it was time to move. He says the time was right and that his ambitions could only grow with a bigger name. "I always thought that if I made a move from ABN, that would be the last one," he says. "I wanted to go to a place where I could catapult the business, and not just be the little guy in the corner of a large European bank but be responsible for running a global business in a truly super-global name. With the additional benefit that my style and the Swiss way of doing business match well, this was a winning combination for both parties."
He was not attracted to the hedge fund world, which he describes as "very cold blooded". Now at Credit Suisse, he says he can reset his target up from the $9 billion he achieved with ABN Amro to $20 billion.
Credit Suisse certainly moved fast once they knew he was looking for a change. A chance conversation with a friend working in the Swiss bank led to an introduction the very next day.
"We discussed what I had done, the plans that I had. I said I wanted to create the same business but bigger. I wanted a dollar fund, a local-currency fund and a hedge fund. It’s essentially what Ashmore did on its own, but in a truly AAA business."
Kassin says the discussion was brief. "We talked about it for about five minutes. I mentioned obviously that I needed to have some kind of logical reward and I needed to have a good degree of independence to make the business work as before. In exchange, I offered to create a strong, long-lasting team."
Aggressive style
Standard & Poor’s pulls no punches in its description of him. "Kassin’s investment style is characterized by aggressive country positioning," it says. "Typically the top three countries will account for more than 50% of the portfolio and [he] selects these based on his conviction over prospective returns with little regard to their position in the benchmark JP Morgan EMBI Global."
S&P ranked his ABN Amro fund top of the global emerging market debt in euros peer group by cumulative performance from launch in June 2003, with consistent outperformance across each calendar year.