CEO interview: “My aim is to create multidimensional value for our clients”

Mr Cresswell, what brings a Brit to Germany?

Both professional and personal reasons. I have been living in Germany for more than 20 years now and feel more German than British nowadays. Indeed, as of 2017, I became a German citizen, something which I am very proud of, although I have still retained my British citizenship. They even call me “Nigel the German” back in the UK, which I guess says it all.

You joined Quoniam as CEO on 1 July. Why did you decide to make this change?

In my 30 years in the investment industry, I have always been focused on solving clients’ problems, albeit from different perspectives – as an actuary addressing the liability side, from an investment banking perspective addressing corporate finance angles, and in investment consulting for 15 years providing a holistic approach to investment issues.

When I was offered the opportunity to become CEO of Quoniam I didn’t need to think twice about it. It is a fantastic opportunity to bring all this experience together and to apply it within a cutting-edge asset management framework to provide clients with asset management solutions for the future. I already knew Quoniam well from my investment consulting days, and its analytical systematic approach always appealed to my mathematical nature, but even more than that, it had always been a positive experience for my clients.

It sure is an exciting time to be a quant, seeing all these developments in AI, Big Data etc. But there are also a lot of challenges in asset management right now. What are the main ones in your view?

In the last two years, we have experienced unprecedented market conditions with extreme asset price inflation. At some point this will be unwound, and hence more than ever, the key question is how to build robust investment strategies for the future. That is not only true for asset managers, but also for investors – they need to build portfolios across a mixture of different styles and factors that, altogether, remain stable and mitigate risks over different market regimes. More and more investors are aware of the role of the component parts across each of these regimes, e.g. that defensive strategies underperform in a turbo-bull market, but in other regimes they will counter the more higher risk strategies.

A structural change is the rising importance of sustainable investing which poses challenges, but also provides great opportunities. Regulation is a driver for many market participants, but similarly investors’ need to establish their own beliefs. I believe that in the long run, investing sustainably will have a better risk-return profile, although in the short-run this may not be the case – here investors have to decide what is important to them. I am convinced that together in the financial industry we can make a major contribution to the sustainable economic transformation required.

How can Quoniam help address these challenges and add value?

Delivering alpha is what we do and furthermore we successfully manage risks, which has led to a good track record over long time periods. This ultimately demonstrates our ability to add financial value across the cycles. But value creation is more than that. Going forward, the added value provided by asset managers should have a lot more dimensions than pure performance. What asset managers need to do is capture the beliefs of their clients and, on this basis, offer solutions or products which give them a range of options for implementation. And this is what Quoniam aims to do.

ESG is a good example: we offer individual sustainable investing solutions so that the strategy really reflects our clients’ goals and convictions. They can benefit from our knowledge on processing and analysing huge amounts of data. We are able to meet sophisticated ESG criteria and still take advantage of a broad investment universe. In general, customisation is key: we can solve our clients’ individual problems with the help of our innovative investment platform and a transparent, efficient investment process.

Innovation is also key. We look to constantly tap into new sources of alpha and enhance our product range, e. g. using AI NLP techniques combined with innovative new data sources. This determination for constant improvement for the benefit of our clients cuts across our firm – from back to middle to front office. A collaborative culture built around a clear purpose is very important in this context.

What does corporate culture mean to you?

I place great strategic importance on a purpose-driven culture that empowers our colleagues to identify and unleash their individual talents. Diversity plays a very important role, as different personalities and perspectives can accelerate our development as an organisation. That’s why we will further strengthen diversity. I want to encourage our employees to realise their full potential and actively contribute to innovation and change in the company – that’s what a positive corporate culture is all about.

Winter is just around the corner. What are your reading recommendations for the dark season?

If you would like to read more about why cognitive diversity is a success factor, I recommend “Rebel Ideas” by Matthew Syed. Another great book is “The End of Everything (Astrophysically Speaking)” by Katie Mack. It is written for the layperson, to explain why, how and when the Universe will come to an end. The good news is, the models indicate that we will be around for billions of years more – more than enough time for long term investment thinking, as always, to be rewarded!