Farringdon to open new office in Labuan and appoints a new CEO

image001 (1)

Over the past 11 years, we have amassed a client bank of well over USD1 billion across our offices and with a recent addition of Dubai, we are now proud to announce our new set up in Labuan.

Labuan FSA announced at the beginning of 2019 that all companies registered in Labuan, will need to maintain an office and staff in Labuan or face changes to the way they are taxed and monitored.

Screen Shot 2019-04-09 at 15.44.44.png


Stuart Yeomans Now CEO of Farringdon Asset Management (Dubai) stated that “Although we are moving and setting up a physical operation in Labuan, we will still maintain our offices in Kuala Lumpur. We have made some changes to the office and are happy to announce Daniel Carnie will replace me as the new CEO of Farringdon Asset Management (Malaysia: Formally – Farringdon Group)

Daniel has been working under myself for over 8 years and is 100% ready to make the big step into becoming the new CEO and to run his new office. There is no end to changes to our industry and even this week we have been informed by clients that competitors are saying we are closing our door. It just goes to show that no matter what you do; like expand into Singapore and Dubai, then into Labuan, not to mention break the USD1 billion barrier, there is always a way in which our industry twists things. These types of rumours are exactly why we need someone knowledgeable at the top and Daniel is the right man for the job.

Daniel commented that “It makes us glad that we made the move to asset management and have expanded the team significantly to ensure that client assets are managed correctly.

Our main aim now is to focus on managing current clients and we are not focused on dozens of sales people; we are now strongly working from referrals and introducers and no longer need to focus on a core sales team. This is good news for prospects as we see the curtain coming down for these heavily sales driven teams as opposed to selecting the lowest cost investments that perform and working from referrals.

The office has gone under some recent restructuring to ensure that in the long term it is viable; we have new introducers that pass us business that they can’t do anymore, and we are always on the look out for good quality consultants. We are specifically after people with USD10 million in AUM to join and we have the correct set up to ensure that they are looked after correctly.

New members of our team will have an existing book that our asset management team can assist on lowering fees for the end client, whilst getting them better performance. This really is possible with our knowledge and because we control a relatively large AUM we can get better deals than most companies.

Stuart closed by saying that people will be surprised that very soon, we are on target to exceed US$2 billion under management this year which will make us one of the dominant players in the offshore wealth space in the world.

Robo-Advisors gaining traction in ASEAN – The Asean Post


Farringdon Group CEO Stuart Yeomans speaks to The Asean Post during an interview at his office in downtown Kuala Lumpur, Malaysia on Aug. 3, 2017. (Joshua Paul for The Asean Post)


The growing Muslim population worldwide, coupled with the increasing demand from the same for Shariah-compliant products, is creating a huge opportunity for the development of financial technology (FinTech) in terms of Shariah-compliant investment-related products.

It offers a massive potential for digital investment advisory services providers to tap into the growing needs for robo-advisors in Asia particular the ASEAN markets, which has more than 600 million population.

Although the usage of Shariah-compliant robo-advisors are still in the nascent stage in Asia, but there are already signs for embracing these new FinTech in the market as investors are looking for an alternative platform with lower cost and high-quality services.

Farringdon Group’s CEO Stuart Yeomans said the robo-advisory services can be used at a very low cost and caters for both the common man on the street to the ultra-wealthy.

Malaysia has higher chances of becoming a global hub for Shariah-compliant robo-advisors in the Southeast Asian region, as there is a huge market for Shariah-compliant investment products.

“Somehow, we have a massive legacy here in Kuala Lumpur, such as building software products and coding system. And it is very economical and cheaper,” Yeomans told The ASEAN Post in an interview.

Farringdon Group, which launched Shariah-compliant robo-advisory services in Malaysia on July 10, is also looking at broadening its horizon in the Southeast Asian markets by tapping into the Indonesia market, which has a large quantity of Muslim population as well.

The platform known as Algebra is based on Shariah investment guidelines and uses a Shariah investment strategy that has been approved by Amanie Advisors’ Founder and Group Chairman, Dr Mohd Daud Bakar.

Algebra, which uses Virtual Mutual Fund Technology (VMFT), is charging only 0.85% fee annually with a minimum initial investment of US$4,000.  

“Yes, Asia has a lot of potential but we have to see the take up rate here first, before penetrating into newer markets,” he said, adding that the company is also planning to make presence in Middle Eastern and Indian markets.

Assets under management (AUM) managed by robo-advisors in the Asian markets is expected to grow exponentially, with the shift from the traditional advisors.

Consulting firm A.T. Kearney forecasted that AUM by robo-advisors will grow by 68% annually to a whopping US$2.2 trillion by 2020. The robo-advisory services adoption rate is forecasted to grow by 5.6% of the total investment assets using robo-advisory services within the same time period.

Robo-advisory is the next step evolution for asset management and financial advice as it is fully digitalised and priced low. The strategic implication of the emergence of robo-advisory services could be profound with increasing consumer expectation for transparency, low-cost products and digitally agile solution.

Having human financial advisor would restrict the quality of the investment management with room for human error and insufficient analysis as there are possibilities to compromise on investors’ interest.


Courtesy of Premalatha Jayaraman – The ASEAN Post

FinTech service to offer PE deals to Asia’s HNWI

Singapore’s Farringdon Asset Management plans a service matching ultra-high-net-worth investors (UHNWIs) with private equity investment opportunities.

The new application called Mercury is designed to match UHNWIs with private equity opportunities valued between $100m and $500m.

It will be launched during Singapore’s Fintech week in November, the company announced.

Farringdon is in negotiation with “several investment banks and PE firms” with a goal to establish a deal pipeline, according to Martin Young, CEO of Farringdon Asset Management.

The firm is targeting individuals with demonstrable assets of at least $30m and institutions with at least $500m. It plans to offer deals in the equity and debt space with a minimum investment of $5m per client. The service will be available to institutional clients worldwide, but it will also target individuals in the Asean countries, Young told FSA.

“We have seen an increasing trend for ultra high-net-worth individuals to invest directly into the kind of debt and equity deals previously reserved only for banks and large institutions,” Young said in a statement. “Mercury is designed to support that trend and get these investment opportunities out to a wide network of potential buyers.”

“Many Asian investors seek out high quality investment opportunities in places such as Europe,” said Ana Isabel Gonzalez, director of Farringdon Asset Management.

“The greatest opportunity for such investment is in the $100m to $500m space. This investment size is often too small for investment banks and institutions but too [high] for single investors. Such projects are turning more and more to so called ‘club deals’ which Mercury will help to facilitate.

Farringdon operates Algebra, a robo-advisory service offering sharia-compliant portfolios to investors in Malaysia, which was launched in July.

Mercury will use the same robo-advisor technology. “The underlying investment preference algorithms will be adapted to private equity- type investments and away from the security-based investments that Algebra uses,” Young said. “Over time we intend to incorporate machine learning into this to help better capture investment preference.”

Farringdon has announced that the service will be accessible via mobile channels, through iOS and Android apps. “There will be a website as well although the fast paced nature of such deals will mean that most transactions will take place via mobile apps,” Young said.


Courtesy of Fund Selector Asia

Robo-Advisors ready to morph Malaysia’s Islamic Finance Industry

Fintech plays plow forward in Southeast Asia as robo-advisor technology emerges as an important trend in Shariah-compliant investments – especially in Malaysia

As the fintech space continues to transform Southeast Asia, robo-advisor technology is emerging as a unique trend in Shariah-compliant investments. This is especially true in Malaysia, where artificial intelligence (AI) could endanger fund managers’ jobs while introducing new investment options to stakeholders.

Robo-advisors are algorithm-based products designed to manage asset portfolios by matching individual risk appetites against stock indexes. They’ve been around for years, but have yet to truly penetrate the global Islamic fund and wealth management market, whose assets under management (AuM) at the end of the first quarter of 2017 stood at $70.8 billion, according to estimates by the Malaysia Islamic Financial Centre and Thomson Reuters.

Shariah-compliant robo-advisors emerged in Malaysia in mid-2016, said Natasha Ishak, manager of banking and financial services at recruitment agency Hays Malaysia. Ishak works closely with the country’s banking industry executives, and her work includes research into the potential disruptions that technology will bring to the sector. She estimates Malaysia will likely see a surge in robo-advisor activity within the next three years.

“Right now robo-advisors are still mainly being used for high-frequency trading, so it’s not as developed as it could be,” Ishak told Salaam Gateway. “If we look at Malaysia itself, in terms of the infrastructure and the algorithms they’re plugging into the robo-advisors, it’s not as sophisticated as I’m sure it will be ten years from now.”

Robo-advisors can potentially shake up the wealth management industry in Malaysia by offering cheaper and more efficient options to a segment that has historically not had much access to investment advice.

Malaysia is in a unique position when it comes to robo-advice due to its leading position in Islamic finance and its Muslim-majority population of middle-income earners.

Islamic finance has an established presence and is highly visible on Malaysia’s financial landscape. The country has the highest number of Islamic funds in the world, totalling 328 in 2016, with assets under management (AuM) of 149.64 billion Malaysian ringgit ($34.9 billion), equivalent to 21.49 percent of total AuM, according to Malaysia’s Securities Commission. The nation’s Islamic funds AuM is second only to Saudi Arabia. The size of the nation’s Islamic capital market was 1.7 trillion ringgit in 2016.

Policy-wise, Malaysia’s government released its five-year Islamic Fund and Wealth Management blueprint in January this year that sets out strategy to position the country as a global hub for Islamic funds, establish it as a regional centre for Shariah-compliant sustainable and responsible investment (SRI), and develop it as an international provider of Islamic wealth management services. At the same time, the country’s securities regulator and central bank are working to hash out regulations for fintech companies looking to establish themselves through a sandbox initiative, which is currently underway.


New York-based Wahed Invest, the world’s first Shariah-compliant robo-advisor, was built on the theory that the biggest value-add of the tech is its ability to be hyper efficient without compromising on ethics. “We built this to provide an efficient alternative, and to prove that there does not have to be a cost to being Muslim,” the company’s CEO Junaid Wahedna told Salaam Gateway.

Wahedna points to excessive charges imposed on clients, particularly those who choose to invest in line with Shariah. Costs such as custody fees, management fees and brokerage fees can come up to a whopping 3 percent of the total investment, and are opposed to Islamic laws with relation to interest rates. For players like Wahedna, these elements are seen as impediments to efficiency, resulting in an industry that lags 20 years behind its conventional counterpart.

“The whole process is inefficient; people are paying up to 3 percent in fees just for investing in a halal way,” he explains. “No active manager can beat the market consistently after its fees are taken into account, and studies and math show that.”

According to PricewaterhouseCoopers (PwC) 2016 Global Fintech report, robo-advisors come into play by introducing “more transparent, traceable, efficient and customer-centric standards along the overall value chain” by delivering “easier, faster and more user-friendly investment based solutions.”

Wahedna says his company’s robo-advisors reduced the inefficiencies in the market by cutting out ‘middleman fat,’ while also charging a single “wrap fee” capped at 0.99 percent of the total transaction.

“You’ve got too many people with their hands out,” Stuart Yeomans, CEO of Malaysia-based Farringdon Group told Salaam Gateway. Farringdon owns Asia’s first robo-advisor named Algebra. To Yeomans, middlemen aren’t just wealth managers, but include the lawyers, sales teams and strategies that bloat costs and weaken supply chains.

“For us, being efficient and ethical is a premise, regardless of whether it slows us down or we don’t make as much money,” adds Wahedna. “I feel that’s really the point of Islamic finance – you have to put the ‘Islamic’ before the ‘finance’ because it’s quite an oxymoron otherwise.”


The introduction of robo-advisors may very well open up key markets for the Islamic wealth management industry via competitive pricing and the promise of Shariah compliance, which is a tricky process even for seasoned wealth managers who usually only get certified once per year.

Shariah-compliant robo-advisors come with the assurance that all portfolio plays have been thoroughly vetted and cleared as permissible. Negative screening approves of stocks that meet the thresholds for non-permissible income, debt, and investments, and do not engage in certain business activities such as gambling, adult entertainment, pork, alcohol, tobacco, or firearms. Wahed Invest is signed off by U.S.-based Straightaway Ethical Advisory and Farringdon by Malaysia-headquartered Amanie Advisors.

The Muslim market also intersects with the growing global middle class that has largely been excluded from the investment market. According to Hay’s Ishak, middle-income earners are currently a target market for financial institutions as they make up the majority of Malaysia’s Muslim population, and are largely uninvolved in investing.

“Lower income people tend to do their own research and trade themselves, while higher income earners will have their own wealth advisors and fund managers,” she said.

Wahedna pointed out that the majority of Muslims live in the developing world, and many of them don’t possess the capital necessary to qualify for wealth managers’ services. Robo-advisors will likely be most beneficial for investors coming from this segment of the population as they do not discriminate between the assets of a middle-income earner and a high-net-worth individual.

“Even if you only have $100, your expected return capital is the same as someone with $10 million,” says Wahedna. “It’s bringing democracy to your investing.”


The biggest losers of the rise of robo-advisors will be traditional wealth managers and advisors, who will have to compete to stay relevant amidst a technology revolution. Ishak pointed out that robo-advisors are dominating more than 80 percent of daily traded stock in mature markets. Wealth managers will likely lose out in the retail sector, which is where robo-advisors will make the biggest impact.

The cheap AI version will easily claim 50 percent of that lower segment of the investment spectrum in the next decade, said Yeomans.

However, wealth managers won’t face serious competition for their high-net-worth clients, who prize a personalized experience over cost. Yeomans said it is highly unlikely we will see millions being invested via a robo-advisor, and in fact, Farringdon core traditional wealth advisory business is subsidizing the tech. He added that Farringdon maintains its traditional services to cater to its high-net-worth clients with more complex portfolios and bigger risk appetites.

PwC’s report suggests that certain high-net-worth clients might not see robo advice as adding value, as they will not be able to handle the more complex aspects of their portfolios.

“If we were to look at funds that are a lot bigger in size, where the risk appetite is higher, you can’t really take out the fund managers and financial advisors completely because the risk exposure and compliance aspect of things are not going to be covered,” said Ishak.

($1 = 4.2820 Malaysian Ringgit)

Courtesy of – SalaamGateway.com