Jefferson L. Matias Oliveira, Director of Asset & Wealth Management at PwC Luxembourg is our Advisor of the Month

Jefferson L. Matias Oliveira, PwC Luxembourg - Currently serving as PwC Asset & Wealth Management Director with major focus on LATAM-Europe cross border investments targeted to Asset & Wealth Management, Banking & Capital Markets sectors. With over twenty five years of experience covering Central Europe, Latin America and Southeast Asia markets, Jefferson has advised Asset Owners (Private and Institutional), Asset Managers, Entrepreneurs, Supranational Institutions, SWF and Corporate-Investment Banks in a wide array of mandates including x-Border In/Divestment initiatives, Fundraising-DCM, Fund Services, Tax Structuring, Project Portfolio Management, M&A, Corporate Strategy and Value-chain transformation. Jefferson holds B.S. in Accounting (PUC-SP), MBA (USP-SP) and attended Executive Education programs at INSEAD Singapore and Wharton.

What made you want to work in the financial sector? What attracted you the most about the sector?

Financial literacy has always been an important foundation of what I believe is the basic “framework” for people to properly and actively manage their lives towards their dreams and wishes. Financial Literacy combined with Education and Health habits form, in my opinion, the robust framework that people should put in place to have better control over their future.

The Financial Sector has always been one of the main catalysts of fundamental changes in the old, the modern and the contemporary Economy. Despite the destructive role finance played in past global economic crises, the convergence of Finance and Technology that we’ve seen more lately has undoubtedly the potential to improve billions of people’s lives and at a pace we’ve never seen before.

I believe that Finance is a force for good, and that’s what attracts me. 

How is a normal day in your role as a Director Asset & Wealth Management at PwC?

Above all, everyone at PwC starts and finishes the day knowing that we are part of a global community of solvers that come together in unexpected ways to solve the world’s important problems. 

A typical day can start over a video call with an Asian fintech entrepreneur that is looking for alternatives to scale up its Digital Securitisation Platform across Europe, by mid-day I could be assessing the implications that the new Pension Reform in Chile may bring to European Asset Managers and by the end of the day I might be meeting a Canadian Alternatives Asset Managers to elaborate potential growth strategies to tackle Private Investors in the DACH region. 

Although as widely diverse as my day can be, it has a clear motto and target which is building trust and finding sustainable solutions to our clients, clients’ shareholders, stakeholders and the wider society. 

Being one within a community of 290.000 PwC people certainly helps. 

What portfolio recommendations would you offer right now to an investor with a conservative approach?

Due to the nature of our assurance business at PwC we have to be fully independent from any sort of very specific investment advice, at the sametime when serving  international institutional and private investors on strategic asset allocation matters we clearly see that uncorrelated investment strategies associated to a global investment approach seems so fulfill notably well this sort of investor that has a conservative profile. 

It is true that within the investment front, the common saying of one size fits all does not necessarily apply. 

Institutional investors, with conservative approach for instance, can easily have access to global investment thesis that are, first, uncorrelated to the domestic markets where they operate and second, it could even meet the low volatility need while benefiting from a certain risk premium. I am referring to High Yield investment products that could be of interesting appeal to this specific investor segment. 

Private investors, with conservative approaches, that are usually more susceptible to short term market fluctuations should - this year in particular where we see several countries battling with climbing inflation - consider investing into either sovereign or corporate fixed income markets. And for those private investors where short term liquidity is not an issue, I would certainly assess the pros-cons of investing into very specific private debt/equity investments, knowing that an in-depth analysis here is a must. 

What type of portfolio allocations do you believe would be more interesting under the current market situation?

Despite the general belief that 2022 would start a bit softer, the reality is presenting itself very differently though, it is very much unlikely that the global economic recovery phase will kick in now in Q1 2022. Moreover, on the geopolitical front the new year has started with unexpected turmoil including the escalating tensions on the Ukraine border, an UK prime minister with bumbling behaviour, new important political figures emerging in Europe, presidential elections in France, Philippines, South Korea and Brazil. All of this comes along with a persistent inflation growth in several countries around the globe. 

From a scenario planning perspective 2020 will undoubtedly bring unexpected challenges, hence I presume that investors in general will reassess their overall risk exposure within their global portfolios by optimizing it with less volatile and low duration investments, that may represent a good opportunity for AM players highly specialized on the Fixed Income and Private Investments fronts. 

Which themes or sectors do you think are particularly interesting at the moment? And what themes or sectors do you think would be interesting in the near future?

The fintech boom will certainly continue in 2022, and specially on what I call the interoperability of traditional & digital finance markets. While most fintech players are at this moment anchoring their value proposition sufficiently well on the digital world, I believe that great opportunities will emerge this year on leveraging the value of real assets into the digital economy. This is the case of Untangled Finance for instance, a start up company that I spoke to the other day.

The royalties business as an investment class is another front where I see interesting potential in the near future, especially because of its cash out structure where investors might benefit along with the creator-author on the distribution of royalties in the long run. Imagine investing into a music catalog of a well established musician where a consistent flow of royalties is expected within the next 10 years let’s say. Now let’s imagine investing into a music catalog of a prominent musician where beside the royalties cash flow there is still the appreciation of the catalog price. 

Besides these two specific themes, the more obvious ones where I would expect a good outcome this year are the Health, Biotechnology and ESG Transitional Infrastructure sectors. 

How would you define yourself in 3 words?

I like when I see a collaborative mind-set, solid loyalty principles and authenticity in other people, which are the same values that drive me forward.    

Do you have any advice for anyone wanting to pursue a career in the asset management industry?

There will certainly be plenty of days where you will question yourself if you are doing the right thing working in that specific industry or with that specific company, which may lead you to endless reflection and misleading conclusions. 

I believe that a more constructive way to see things is defining what is your real purpose and if what you are doing is actually leading you there. You have to be the driver, and the company or industry you decided to work with the co-pilot.