About Arete
What protections are there from key person risk?
It is true that Arete depends substantially on the services of David Robertson, although we believe there are many factors that vastly mitigate key person risk for Arete clients. First, Mr. Robertson is 43 years old and in excellent health. As a result, there is very little risk of untimely death (to be exact, death probability for a 43 year old male is only 0.003127 according to Social Security’s actuarial tables). We do not consider this to be a material risk.
We also believe the nature of our investment philosophy and process guard substantially against the dangers of anything happening to a key person. Due to our long-term investment horizon and relatively low turnover, there are simply very, very few situations that require the urgent attention of a key person in order to maintain investment performance.
In addition, we believe that an important consideration in evaluating key person risk is determining for how long an investor may be able to benefit from the services of a skilled fund manager. Fund manager turnover at many organizations can occur every two to three years. Due to the substantial vested interest Mr. Robertson has in Arete, we believe you have a much better chance of receiving an enduring commitment from Arete than at many other larger organizations.
Masthead image copyright © 2006 by Kenneth Blackwell. Used with permimssion.