Brandvoice
“Psagot’s major growth will be due to its security finance company”
Yohan Kadoche, CEO of Psagot Investment House, plans to bring capabilities to the investment house that did not exist before – with an emphasis on international investments and opening markets abroad
Yohan Kadoche, CEO of Psagot, helped lead the sale of Psagot last year from Apax Partners and Altshuler Shaham to Valio Capital, led by businessman Rani Zim. The deal included mutual fund activities, portfolio management, and stock exchange member activities. Kadosh has been appointed CEO of Psagot, also in light of his impressive record and mainly due to his connections, expertise, and extensive experience in the local and international investment market, to which he directs Psagot.
Kadoche came to Psagot with impressive achievements in the past – he began his financial career 25 years ago in London, at the international finance company Cantor Fitzgerald. After a brief stint at the company, he was promoted to head of the Paris branch and head of the international corporate bond division. “These were significant years in the world of finance and the global economy,” says Kadosh.
In 2005, he immigrated to Israel and founded the Camelia Capital Investment House. Camellia was a great success, and in 2012 was acquired by Meitav Dash Investment House. Kadoche then acquired Magna and developed advanced investment activities and financial solutions. Magna was later acquired by More Investments. In 2020 Kadosh left Magna which has since become a significant growth engine for More Investment House.
“Psagot was an opportunity – a financial company with a reputation of knowledge and experience of six decades, it had significant potential that I thought should not be missed,” explains Kadoche.
“Throughout the negotiations with Apax and Altshuler Shaham Investment House, it was important to me to maintain quality human capital. We cared about the employees – most of them experienced and knowledgeable in their field – and not just the financial asset, unlike other financial companies interested in Psagot.”
“I run a marathon”
“Faith always guides me – I am a believer. Along the way, I felt something strong pushing us forward. By nature I am a marathon runner, I do not run short distances. Therefore, the future of Psagot is very clear to me. Psagot is a financial company with high growth potential and ordinary professionals. “First, the finance and product industry is growing rapidly and at the same time, the range of options that can be provided to customers continues to expand. In order to grow, Psagot will present innovation in products and brokerage investment activities in the international market.”
Psagot is considered a leading body in the field of portfolio management.
“I plan to build long-term processes and activities. Psagot is a leading investment house and will continue to be a major player in the field. We intend to develop a range of advanced financial products and enable our clients to invest worldwide.
“Along with the company’s veteran and experienced executives, we have recruited a new team with extensive experience in the capital market. A successful and high-quality team that will allow us to accelerate our growth strategy. We intend to develop Psagot’s operations in international markets And enable Psagot’s private and institutional clients to receive a range of professional services in the areas of foreign securities, unique financial products, and quality exposure to the various global markets.”
Sustainability and virtual cryptocurrency
Kadoche presents the four main activities of the company:
1. Portfolio management for corporations and the private sector. The area currently covered by Psagot is more than 12 billion NIS.
2. Management of hedge funds (“Pareto”) – Psagot has two hedge funds that have shown excellent results in the last two years. In addition, we have recruited and formed a leading team of specialized funds in Psagot. “We have added two more areas in Pareto – pharma, and ESG,” says Kadoche, “environmental and social responsibility, or ‘sustainability.’ This is an evolving field in the world. In Israel, this field is only beginning to gain momentum, but there is a growing interest among Israeli investors in this field as well.”
3. Brokerage services – providing access to a variety of diverse activities in the markets in Israel and abroad to our clients. Psagot is considered a leader in brokerage, and we will strengthen our position in markets abroad.
In this context, it is worth noting the international networking that Kadoche brings with him, both in research, in execution infrastructure for markets, and with international banks and global companies.
4. Alternative products – a relatively new field in Psagot that is accessible to our investors through alternative investment funds in the field of high-tech, real estate, credit, SPAK, etc. In real estate, Psagot has a great advantage thanks to the specialization of Rani Zim, who is a leading real estate entrepreneur in Israel. In the field of credit as well, we will bring customers the most lucrative opportunities.
A new field we are entering – is the digital currency market. In this area, too, we are mobilizing the best minds, and we will allow our customers access to the purchase and sale of digital currencies.
Before we entered Psagot, the investment house invested more in long-term products such as pensions, provident funds, and continuing education. Currently, these areas have been managed by Altshuler. Psagot currently manages about NIS 70 billion in the field of mutual funds and securities.
“We intend to develop capabilities that did not exist before in Psagot, and we will allocate large resources for this. In addition, we have recruited a variety of talents and experts with the goal of continuing to develop and grow Psagot Securities as a market leader.” Psagot Securities currently has one of the largest “30 analysts and macro and micro researchers, overseen by Rani Zim, who gives us the strength to continue to succeed.”
“We are better than ever”
Eyal Goren, CEO of Psagot Mutual Funds, talks about the new growth engines in the world of finance and provides an intriguing investment forecast for 2022
In the past year, we have transformed from a company with uncertainty to the safest and most stable investment house for employees – under new management, headed by businessman Rani Zim. Today, Psagot Investment House continues to lead with significant activities in the world of finance, such as hedge fund management, portfolio management, mutual fund management, extensive brokerage activity, and as a stock exchange member, we provide independent trading services.
“We provide all the services and product range through our excellent team of experts, people who are the beating heart of Psagot, and through several new recruitments. We have recently recruited key people in the fields of economics and capital market,” Says Eyal Goren, CEO of Psagot Mutual Funds for the past five and a half years.
“Our goal is clear. We want to expand existing activities and develop new ones, striving to provide our customers with as many advanced financial solutions as possible.”
Goren, 38, began his financial career at Psagot about 14 years ago, while still a student. Over the years he has progressed with patience, perseverance, and daily learning. In 2016, he was appointed CEO of the mutual fund company that manages assets valued at approximately NIS 50 billion.
The business landscape underwent a fundamental change during that period. Psagot Investment House changed management and ownership, initially from the York Fund to the Apax Fund, and later to the public company Valio Capital, headed by businessman Rani Zim. In June 2021, Rani Zim acquired through Valio Capital the investment house, which includes the subsidiary group, with the exception of the provident and pension activities that were merged with Altshuler Shaham.
Goren’s long experience in the world of investments and within Psagot, allow him to look in a deep and professional perspective on processes and trends in the capital market, the great change that Psagot Investment House has undergone, and tell us about new growth engines in the world of finance, and an interesting investment forecast for 2022.
A stable investment house
Psagot has experienced many changes in the last year.
“Before I explain the immense change we’ve experienced, it’s meaningful to get some background on the processes that preceded it. People do not like to live in an environment of uncertainty, just like the financial markets. This business called an investment house is a business of people who had to function in a challenging atmosphere of uncertainty.
Many believed that Psagot’s operations would be merged into a competing financial entity. How did this affect the employees, and did you believe that at some point a businessman would arrive who would keep the activity under the “Psagot” brand?
“As I said, no one likes to live in uncertainty. Psagot has experienced changes in recent years, and organizational change in late 2019, an outbreak of the corona crisis in early 2020, and the announcement in early 2021 regarding the sale of the company by the Apax Fund.
“This process created headlines in the media, every headline in the newspaper had great significance, and it troubled the workers who feared for their livelihood, and one can understand each one of them. Some workers could not cope with the tension and chose to leave, But the company’s strong and stable anchor was able to read the situation correctly.
Act and respond quickly
“Within the mutual fund company, there was a strong feeling that the acquisition would be completed by Rani Zim and not by the competing companies that planned to merge the company to remove a significant competitor from the market.
“It is worth noting that Rani Zim’s team was the most professional, they asked the right questions, and Rani was mainly interested in employees and continuity, while the other contestants were interested in the bottom line, in numbers. It was important for Rani to meet with us, talk to everyone.”
You mentioned Psagot Mutual Funds, which is part of BIG4. What do you think sets the company apart?
Psagot Investment House is a long-standing brand among investors and investment advisers, a leading financial body, which managed investors’ money responsibly, transparently, and in the most professional way possible for six decades.
Psagot Mutual Funds is part of the prestigious BIG4, out of 20 mutual fund companies in a very competitive market. We have funds that specialize in a variety of types, both managed funds and index-tracking funds.
“One of the things that stands out in Psagot’s fund company is the veteran and experienced management, which knows how to respond quickly to changing market situations and regulation – a significant advantage, both in the business and professional aspects.
“Managing so much money for so many people is a big responsibility, and we understand the magnitude of the responsibility and re-evaluate the trust of investors every day.”
Growth engines
The Investment House ended 2021 as the largest fundraiser in the segment, with a huge leap in market share. “Once we got the company in our hands we were asked to prepare a strategic plan on a type of product that was relatively new to us, we conducted an in-depth examination and market analysis, and realized we needed to act quickly to build a strong arm of index-tracking funds.
“This is the vision and strategy that we presented about a month after the merger of the companies in July 2019, since we managed to be a company with tremendous growth in imitation funds, which are the fastest-growing channel in the fund industry. The day we presented our vision to the board of directors, we managed about two billion shekels in imitation funds, today we are approaching about ten billion shekels of assets managed in these funds, and the growth trend continues.
“Financial markets have undergone and will undergo major changes, and the development and identification of advanced financial tools relevant to the changing business environment have always been and will always be the key to growth. Also, management is always attentive to markets and investors alike.”
Seizing opportunities
In Goren’s professional estimation, the second half of 2022 certainty will increase, and the economic environment will become accustomed to a world of rising interest rates. “We are sowing today, and in a time of positive sentiment in the markets I believe and am sure we will be prepared to reap the fruits of investment for investors,” Goren explains.
“After stock index peaks, in which we saw risk assets give excess returns, we are entering 2022 with an approach that emphasizes risk management and treading carefully. The transition from a world of zero interest rate, to the beginning of interest rate hikes in the United States, and later in Israel, requires us to exercise daily judgment and careful analysis of the odds versus the risk in each asset.
“We expect the first half of the year to be volatile. It is important to note that for an experienced investment body like Psagot, volatility is not a bad word; volatility creates opportunities for us to take advantage of market opportunities, and tactical action to generate high value for investors.
“At a time when all assets are rising it is difficult to discern which investment manager is the most professional, but in times of volatility, mutual fund peaks have stood out favorably, and the clear benefit of managing our investments can be seen.”
The above does not constitute investment advice or investment marketing and does not constitute a substitute for investment advice or investment marketing.
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