Incentives. Alignment. Performance.
The investment industry is highly conflicted. As the CBC reports have demonstrated, a vast majority of investment “advisors” are driven by sales quotas. These salespeople and the financial institutions they represent are not aligned to you. They have no incentive to protect or grow the wealth you have spent a lifetime building. They are motivated to sell you stuff. Much of it may do you harm.
Things are done differently at Meritocracy Capital Partners Inc. (“MCP” or “we”).
MCP takes a meritocracy approach to the business of wealth management. It does this by closely aligning its incentives to clients’ objectives for wealth preservation and growth. We assert incentives are vitally important when managing our clients’ wealth. Billionaire investor Charlie Munger frequently speaks on the topic of incentives. According to Warren Buffett’s right-hand-man:
Show me the incentive and I will show you the outcome. – Charlie Munger
MCP aligns itself to its clients by:
1. Providing a performance-driven fee structure, and
2. Eating its own cooking.
Performance-Driven Fee Structure
The first way we align our interests to our clients’ objectives with an performance-based fee structure. It was designed this way to deliver value and performance to our clients. To ensure intelligent decisions are made, performance fees are contingent or earned only when investment performance simultaneously exceeds two (2) performance thresholds. This pay-for-performance structure motivates us to protect and grow our clients’ wealth.
Otherwise, clients only pay a base management fee that is a fraction of what the average equity mutual fund charges in Canada. The two (2) performance thresholds were designed to reinforce the fiduciary duty we have as a wealth manager. They are also a constant reminder of our commitment to always act in the best interest of our clients.
Eating Our Own Cooking
The second way MCP aligns itself to its clients is by having its Chief Investment Officer (“CIO”) as a client. In fact, the CIO has $250,000+ his retirement money invested right alongside clients. Our clients have told us they sleep better at night knowing their investment portfolios hold the exact same stocks and bonds as the CIO’s investment portfolio.
MCP is confident this unconventional approach in managing its clients’ wealth helps minimize the conflicts of interest that are inherently common in the investment industry. It is also in stark contrast to how many of the big Canadian banks have operated in the recent past. By eating our own cooking, we treat our clients’ money like our very own.
How Could You Be Better Served?
Accountability & Integrity
MCP practices a meritocracy approach to the business of wealth management. We do this by aligning our interests to our clients objectives for wealth preservation and growth. This inextricably ties our reputation to our clients’ fortunes, which creates a culture of accountability and integrity. This drives us to treat our clients’ money like our very own.
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