It is a simple question, yet one that sits at the very heart of financial advice. When a client hands over their life savings, their retirement fund, or the proceeds of a business they have spent decades building, they are not simply transferring capital. They are extending trust. And that trust flows in two directions: from the client to the adviser, and from the adviser to the fund manager they have chosen to recommend. The weight of that chain of responsibility should never be underestimated.
This week, we welcomed two groups of visiting advisers from Japan to our offices. It was a reminder of just how seriously the international advisory community takes the process of knowing who they are working with. They did not come because a brochure impressed them, or because a fund factsheet showed attractive numbers. They came because they wanted to look people in the eye, ask difficult questions, and form their own judgement. That instinct is entirely correct.
Thorough due diligence should include verification of the management company, the experience and track record of the people behind the fund, and the stability and alignment of interest of the investment team. They are the foundations upon which any serious professional relationship must be built. The fund manager is the single biggest driver of outcomes, and evaluating their capabilities and integrity is a critical part of the due diligence process. An adviser who skips this step is not merely being careless with a process; they are being careless with a client’s future.
The investment universe offers no shortage of choice, which is precisely what makes selection so demanding. Global equity funds captured significant investor interest in 2025, with passive index funds proving particularly popular as investors sought simple, diversified global exposure. Passive structures have their place. An S&P 500 tracker, an MSCI World fund, a NASDAQ index vehicle will each serve a client reasonably well in a rising market, and the cost argument for passive investing is straightforward on the surface. But markets do not only rise, and cost alone is not a strategy. When volatility arrives, when geopolitical shocks emerge, when correlations converge during periods of genuine stress, a passive fund offers no judgement, no adjustment, and no defence. It simply follows the index downward.
This is precisely the space that active, experienced fund management is designed to occupy. Selecting the wrong manager and landing in the bottom quartile exposes investors to significantly greater underperformance. Choosing the right manager, therefore, is not a peripheral concern. The dispersion of outcomes across active managers is wide, and the marketing materials of almost every fund manager tell a compelling story. The only reliable way to cut through that noise is through direct engagement.
The roles of the financial adviser and the fund manager are complementary rather than competing. Advisers focus on client relationships, financial planning, and the service dimension that clients value. Fund managers focus on portfolio construction and the ongoing discipline of investment management. Each requires specialist expertise and depends on the other functioning well. When that relationship works, the client benefits; when it is poorly formed or based on insufficient knowledge, the consequences can be serious.
Assessing whether a manager has meaningful personal capital invested matters, because alignment of interests strengthens accountability. That kind of assessment does not emerge from a document review alone. It emerges from conversation, from challenge, and from the direct dialogue that only comes with in-person engagement. Sitting across a table from a fund manager, asking them to justify a decision made during a period of market stress, understanding how they think about risk and downside protection; these interactions reveal far more than any written report.
At Dominion Capital Strategies and Pacific Asset Management, we have long believed that visits to our offices in London and Guernsey are not a courtesy. They are a professional necessity. The adviser who has walked our floors, met our teams, and engaged with us during periods of market concern is an adviser who understands what they are recommending. They can explain it clearly to their clients, defend it when questions arise, and know who to call when they need answers.
We are, in the end, in the trust business. The integrity of that chain depends entirely on the quality of the relationships within it. Building those relationships takes time, commitment, and a willingness to ask hard questions and expect honest answers. It is not glamorous work, but it is the right work, and it is work we welcome.
Disclaimer: The views expressed in this article are those of the author at the date of publication and not necessarily those of Dominion Capital Strategies Limited or its related companies. The content of this article is not intended as investment advice and will not be updated after publication. Images, video, quotations from literature and any such material which may be subject to copyright is reproduced in whole or in part in this article on the basis of Fair use as applied to news reporting and journalistic comment on events.
