Why Active Investments Support a Personal Service

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“Shaping investments around the individual, rather than shaping the individual around a model”

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In a landscape increasingly dominated by automated platforms and low‑cost, index‑tracking solutions, it is easy to mistake standardisation for progress.  Passive portfolios and generic model strategies undoubtedly serve a purpose: they offer broad exposure, simplicity, and efficiency.  But investing is not a one‑size‑fits‑all exercise, and investors are not homogeneous.

This piece explores why many investors choose an active approach grounded in fundamental research, long‑term thinking, and thoughtful customisation. It does not predict future returns or imply that active management is inherently superior.  Investments can fall as well as rise, and investors may get back less than they originally invested.  Instead, it outlines the considerations that often make a personalised active strategy more aligned with an individual’s objectives, risks, and financial circumstances.

Tailoring A Strategy to Real-World Objectives

Passive strategies typically target market exposure, while Active strategies can target client outcomes as active managers can incorporate client objectives which are not purely a function of market exposure, volatility, and efficiency.   These can include:

• aligning investments with client values

• managing existing holdings which cannot be sold for tax or professional reasons

• adapting portfolios around major life events

• providing clients with a sense of partnership, engagement and enjoyment

• being able to provide reassurance during times of stress

• educating the next generation

  
  

By not just focusing on statistically measurable goals, an active approach can shape investments around the individual rather than shaping the individual around a model.  In short, a passive approach gives access to market exposure, while active managers sell a broader service which incorporates exposure.

A Long-Term Framework for Better Decision-Making

Ptarmigan Capital’s investment process emphasises three principles that matter enormously over time:

Benefitting from long‑term compounding

Compounding works best when investors remain invested through cycles. Owning companies that reinvest effectively and generate cash sustainably can amplify this effect.  Importantly, a company must survive to be able to compound.

Trusting our investments

Our process recognises that a company’s own management team is best placed to navigate operational and strategic challenges, and we therefore focus on assessing the ability of a business to respond to changing opportunities and threats instead of assuming we can predict or direct their actions more effectively.

Not mistaking a good company, for a good investment

Public markets offer investors a price which can be good, or bad.  Our style framework forces us to search for good investments and not be drawn into only buying good companies at any price.  We aim to buy good companies, which are also good investments.

We rely on fundamental research to find companies which can survive and compound, we search for management teams with a good strategy and good incentives so that we can trust them to respond to opportunities and threats for us, and we study risks, valuation, and broader investor thinking to determine if we’re making a good investment.

Understanding What You Own

At the heart of Ptarmigan Capital’s process is a belief that not all businesses are equal, and we always ask some simple questions:

• what does the business do?

• how does this business resist competition?

• why do customers want its product or service?

• why can this business generate more profit for shareholders?

• do we agree with management’s strategy?

• how is management incentivised?

• what risks can management control?

• what risks are outside management’s control?

• what do we think this business is worth?

• what do other investors think about the business?

Layered on top of these questions is a portfolio construction approach focused on direct single line securities that means we can understand our portfolios, not just our holdings.  Our portfolio managers can see and understand the building blocks, and they have the autonomy, flexibility and accountability to assemble them into a portfolio which they believe will best meet each client’s needs.  Passive and model‑driven services often separate “client interface” from “investment decision‑making”.  Ptarmigan Capital’s approach unifies them.

Flexibility and Judgment in Changing Conditions

Passive approaches implicitly assume that yesterday’s composition is optimal for tomorrow.  This often works well in the short term, but when circumstances change yesterday’s composition is rarely optimal for tomorrow.  This is not about attempting to forecast short‑term macro trends but is about responding to new information thoughtfully and applying judgement in a measured, disciplined manner. 

This allows active managers to decide when to move with the crowd, and when it’s sensible to stand apart and be different, taking advantage of market stress or implied expectations which feel unrealistic.

Ptarmigan Capital's Approach

Most active managers claim to offer “fundamental research”, “judgement”, and “personalisation”. What differentiates Ptarmigan Capital is not the language but the structure, process, and incentives that make those claims real:

Portfolio managers are the actual decision‑makers

Many firms separate the “relationship manager” from the “investment manager”, which dilutes accountability and weakens the link between client objectives and portfolio decisions. At Ptarmigan Capital, the client speaks to the portfolio manager constructing the portfolio, and this portfolio manager is also an influential shareholder who must justify business decisions to the client.  This accountability helps create genuine alignment and ensures personalisation isn’t superficial.

A deliberately low client‑to‑PM ratio

Ptarmigan Capital limits each portfolio manager to around 20 clients, enabling genuine customisation and ongoing dialogue. Most competitors operate at far higher ratios, making truly bespoke management operationally impossible.

A research framework built on repeatable discipline, not “storytelling”

Ptarmigan Capital’s process (market power, cash‑flow potential, strategic alignment, actual risks, valuation, perceived value) is unusually explicit and transparent. Many firms reference “research”, but few show clients exactly how investment decisions are made and what must be true before a company enters a portfolio.

Direct securities are more flexible building blocks to create customisable client outcomes

A portfolio manager relying on funds to build a custom portfolio can deliver an element of customisation, but they can’t control what securities are held within the underlying vehicle.  This creates a challenge when trying to justify to the client why they hold an underlying security, particularly in times of stress when an active manager can explain why they continue to hold a security; it also makes it challenging to incorporate the investment values of the end client at a security level.  Furthermore, third party funds, particularly ETFs, incorporate unintended factor, style, or geographic biases which may be undesirable.  Active managers can cherry pick the desired characteristics.  This approach of delivering a transparent and researched group of basic building blocks is quite different from managers who mostly allocate to funds yet still describe themselves as “active”.

True personalisation with documented justification

When two clients in the same mandate hold different portfolios, Ptarmigan Capital documents why. That is rare. Many firms say everything is “bespoke” but manage portfolios that are effectively identical.

In short, Ptarmigan Capital’s differentiator is not claiming to be active, it is structuring the entire firm so that genuine active management is possible.

Thoughtful Investing for the Individual

Active investment management, when grounded in fundamental research and shaped by long‑term discipline, offers a way to build portfolios that reflect the complexity of real individuals. It is a commitment to understanding, analysis, judgement, and adaptability.

While no investment approach can guarantee outcomes, in a world that increasingly values automation and scale the ability to think deeply, act deliberately, and tailor portfolios to the individual remains not only relevant, but often essential.

Risk Warning & Disclaimer

This article is provided for general information purposes only and is not intended to constitute investment advice, investment research, or a personal recommendation. It does not take into account the investment objectives, financial situation, or particular needs of any individual or entity.

The value of investments and any income derived from them may fall as well as rise, and investors may receive back less than they originally invested. Past performance is not a reliable indicator of future results. Where investments involve overseas assets, returns may be affected by movements in exchange rates.

The views expressed are those of Ptarmigan Capital as at the date of publication and are subject to change without notice. References to investment concepts, asset classes, or portfolio construction approaches are included for illustrative purposes only and should not be construed as a recommendation or a solicitation to buy or sell any security or financial instrument.

Ptarmigan Capital Limited is an employee-owned investment management firm providing discretionary investment management services to private clients, trusts, charities, and family offices. This article is intended to explain the firm’s perspective on bespoke investment management and the factors some clients consider when choosing such an approach. It does not relate to any specific investment product or strategy.

Ptarmigan Capital Limited is authorised and regulated by the Financial Conduct Authority (FRN 940407). Registered in England and Wales (Company No. 12715470). Registered office: 17 Cavendish Square, London W1G 0PH.