The Magallanes, Azvalor or Cobas funds are surely among the first that would come to mind for any investor considering an independent manager. In fact, of the 33 billion euros that this group of companies manages in Spain in investment funds (which represents a market share of almost 9%), 26% monopolize it only among these three firmsaccording to Vdos data, having been able to attract thousands of participants thanks to its value strategy.
This trio of signatures is increasingly close to the ten-year mark of life (Magallanes is doing it this year), a period that represents the maturity of its collective investment vehicles since, after having gone through different market cycles, the strategies of those responsible should have already borne fruit and demonstrated their coherence.
But while Magallanes, Azvalor and Cobas are the most prominent names, they are not the only funds to have emerged during this period. Avantage Fund, Bluenote Global Equity, Ábaco Global Value Opportunities either Numantia World Heritage Site These are just some of the products that have also completed a decade of existence, and the result, as in the case of the funds of Iván Martín, Álvaro Guzmán and Fernando Bernad, and Francisco García Paramés, can be considered satisfactory for their investors.
Although it is not common for these funds to be measured against a specific index, if we take into account the evolution of the MSCI World index since 2014, the benchmark index par excellence for analyzing the behavior of the world stock market, we see that it has revalued by 7.46% annualized from January of the same year to September 12, 2024. And this percentage is exceeded, in some cases largely, by the majority of these products.
It must be taken into account that, although it is generally associated with the fact that all independent companies follow a strategy valueThis is not always the case and although they may exhibit characteristics of this investment philosophy, each has its own particularities. In fact, Morningstar classifies them differently depending on the investment universe they manage.
In addition, by prospectus, many of these funds prefer to be classified as mixed products, with a wide margin to invest in stocks, and have the possibility to reduce their exposure to the stock market if they deem it necessary. The profile of your investors also influences this aspect.
For example, funds such as Magallanes European Actionswhich is listed as a European flexible capitalization stock market vehicle, largely exceeds the 3.97% of the MSCI Europe and even the 7% annualized of the MSCI Europe Small Caps including dividends, just like Valentinewhich has gained 7.75% since 2014. For its part, Abaco Global Value Opportunitiesdirected by Pablo González, or Advantage Fundled by Juan Gómez Bada, achieved a performance of 7.96% and 9.2% respectively, while Bluenote Global Actions gain 6.31% and Numantia World Heritage Siteadvised by Emérito Quintana, is close to a 12% revaluation.
After the manager of Iván Martín and Blanca Hernández, the second most famous to see the light of day was Azvalor, whose star fund, the Azvalor Internationalhas appreciated by almost 10% since 2015. Cobas Internationalled by Francisco García Paramés, born later due to the waiting period that the famous manager had to respect after his departure from Bestinver, provides 12.29% since 2017. Percentages that show that the magic Compound interest works in the long run, considering that the minimum return required would be 7% annualized, if you have the patience to tolerate the volatility you experience along the way.
It could be argued that they are, however, less than 11% of what the S&P 500 has achieved in the last decade, but there are funds that manage to exceed it, for the moment, and the results show that the Spanish independent management sector can compete with international companies.
Although these funds mentioned are those that have already completed a decade or are about to do so, they are not the only ones that exist in the independent universe of Spanish investment vehicles. Merchfond, Lierde, Muza, EDM International Equities, Metavalor Global, Global Allocation, B&H Shares…there are other funds of companies of this type which already have a significant history of their strategies, without forgetting Bestinver, the parent house of independent management in Spain.
Overcoming obstacles
But the success of the profitability of these funds does not correspond to a greater volume of assets. It is true that many of these strategies started from family wealth management projects and have managed to open up to other types of investors by demonstrating their good work. In fact, having a long history allows them to access most institutional investors, although the volume of assets under management continues to be an obstacle in many cases. The control of the distribution networks exercised by financial entities does not facilitate their commercial work either. And sometimes, it is the pressure of private banking clients that imposes the possibility of being able to contract these funds in their entity.
A situation that, according to independent firms, will change in the coming years. Iván Martín, president and investment director of Magallanes Value Investors, explains that open architecture has been opened to international managers, but not to Spanish ones. “Perhaps it is the fear of losing the relationship with the client. Omnibus accounts should help to lose this fear, but we resist it,” he emphasizes, considering that the new European regulation that encourages the disappearance of retrocessions can be an incentive for projects. . independent.
“We need to increase the number of independent advisors, advisors who offer their clients what they consider to be the best funds because they do not have a conflict of interest with their own products. And independence and not having their own product forces them to look after the client’s interests, as well as educating the client to pay for advisory services,” Martín emphasizes.
A consideration with which Fernando Primo de Rivera, advisor to Bluenote Global Equity, agrees. “Despite the age of the fund, Distribution is not easy due to the enormous difficulties faced by most Spanish banks. to be able to subscribe to it by its customers. This is something that I hope to be able to correct in the future and move towards more adequate Mifid compliance,” he emphasizes.
Gonzalo Recarte, CEO of Cobas AM, goes further and believes thatThe best measure would be to remove the tax advantage of the transferability of funds in Spain.“so that the low profitability of many products cannot be masked by moving them from one to another. Customers would be more selective when purchasing a product and would have a very long-term vision,” he emphasizes.
Juan Gómez Bada, director of eaf Avantage Capital, who acts as advisor to the Advantage Fund for Renta 4, emphasizes that having reached the decade of life means that “many more people know us, but We remain unknown to the vast majority of investors who invest in funds. But the fact that it recently completed ten years with very good results means that more investors are taking us into consideration. Advantage Fund It already had 5 Morningstar stars at 3 and 5 years and, for a month now, also at 10 years”, which allows it to envisage that it will be able to double its assets in the years to come.
Although winning muscle Equity is an aspiration, these companies are not obsessed with growth either. “We don’t set a volume target, our obsession is profitability. In fact we think Valentum is a fund that Its size should not be excessive, in order to remain flexible when investing.r in companies that larger funds cannot enter,” explains Beatriz Valdecantos, head of investor relations at the manager. And precisely this bias in favor of mid- and small-cap companies means that “in different economic cycles there is a different appetite for a product like ours.”
María Pont, director of investor relations at Ábaco Capital, emphasizes word of mouth from clients to attract new investors. “The trust we have generated over time is key to our growth, and this is reflected in close relationship we maintain with our customers“, besides the fact that “the fund’s track record and results have given us a lot of credibility. With an annualized return of around 8% over 15 years, this certainly facilitates the process, but it is also essential to convey our long-term vision. Our main clients are investors retailbusinessmen and family groups who appreciate both the stability and the potential for revaluation of the fund,” he emphasizes.
