Philippe de Weck

Philippe de Weck is easy-going on the surface, but intense at heart. It’s a rare combination and one that’s tempting to stereotypically attribute to his American and Swiss heritage. More importantly, it’s probably exactly the personality needed to be responsible for all equity investments of Pictet Asset Management (PAM). If you’re in charge of the largest part of the franchise, it helps to be both cool and focused.

Both his grandfather and father were members of the Group Executive Board of UBS, with his grandfather also serving as CEO and Chairman of Switzerland’s largest bank. I caught up with Philippe for lunch at our 5th floor client restaurant in Geneva. Somewhat like “Lunch with the FT”, but probably with far better food.
 

Tell me how you got to where you are today.

I grew up about 80 percent in the US and 20 percent in Zurich, went to an Ivy League University and the normal thing next was to go to Wall Street. So I did that, and because of my Swiss roots I chose Credit Suisse First Boston and worked there for six years in New York and London. I didn’t want to work at UBS because of the family connection. I felt a certain degree of independence would be better.

And then you joined Pictet from Credit Suisse?

Yes, I was in New York during 9/11, and it made me realise that I distinctly identify more with the values of Switzerland. So I decided to look for opportunities in Zurich and Geneva, and Pictet offered me a role as an analyst for one of our early thematic funds. That was 18 years ago and we managed less than CHF 400 million in our thematic franchise.

How long were you an analyst for that fund?

Actually only for one year. After a year the fund manager went on to do something else, so I ended up getting to run the fund. It was the predecessor to Pictet-Digital and it was a small fund, a little less than CHF 100 million.

What’s it like to manage money?

Is there a day where you don’t look at performance?Looking at daily performance actually leads to a lot of mistakes. You can’t come into the office and say you will make performance in one day. We need to keep an eye on the long term, because we want our clients to be long term as that’s an edge in the market. We can hold investments when others have to fold their cards.

So where does the stress come from?

For most investments you make, you’ve bought when the market is not thinking like you. So you have to wait until other investors learn and process the information that you’ve seen early and then the stock price moves in your direction. That waiting for the market, which can take a long time and can go against you before reverting, is where the stress comes from.

Is there a particular mentality you look for in a fund manager?

There are no rules. Generally a good fund manager will be someone who has an independent mind, someone who doesn’t want to be popular, but who wants to be right. It’s not easy to buy a stock when it doesn’t look so good and sell it when it looks good. You don’t get a lot of applause for that. Successful fund managers are usually not looking to be the star of the cocktail party.

And what’s it like to manage people who manage money?

It helps to have managed money yourself, because you understand how lonely it is when things are going against you. That’s when you need to provide support. And when things are going well, you have to make sure people don’t fall too much in love with their results. Investors tend to mistake positive performance for skill and poor performance for bad luck. The reality is that there’s luck and skill on both sides. I also think it’s key not to be directive as a manager on investments. We have smart, capable people in our investment roles. So you ask questions about decisions and convictions and you analyse the process, but you don’t tell people what to do. Because once you start interfering, you have to stay involved, and that’s impossible for every portfolio all the time.

So which of your investment strategies are you most excited about at the moment?

That’s like asking me which of my three sons I’m most excited about. There’s not one who has more potential; they just have different potential.