Three Killik partners, including ex-chief investment officer Paul Kavanagh (pictured), have received the green light from the regulator to launch a stockbroking and asset management business.
Patronus Partners will target retail and professional clients, offering access to contracts for difference (CFDs), spread betting and managed futures alongside ISA, Sipp and general dealing accounts.
Kavanagh, who is CEO, is joined by John Prior, CIO and Kareem Khouri, COO. All three formerly established Killik’s derivatives division and ran a managed futures strategy, which will transfer to Patronus.
The trio departed on good terms with Killik after it decided to scale back to focus on its core private client business.
‘We were responsible for the desk that looks after some of the more sophisticated aspects in investment management. We were able to take that product with us and approach clients who also undertook activities, such as CFDs and spreads, to come over to our new firm,’ Kavanagh said.
Patronus will also offer advisory stockbroking, advisory derivatives and investment management. It plans to expand its product range and develop the proposition later down the line. The team aims to grow assets to £70 - £100 million over the next 12 months.
The managed futures service, a discretionary absolute return strategy, will charge a quarterly performance fee of 20% of all profits net of commission over a high watermark. There is no management fee, although commission is charged per index contract.
For suitability, due to the higher risk of the strategy, Kavanagh said they have a detailed suitability assessment prior to accepting clients into the service.
They have also hired Harriet Harrison from Killik as operations manager and Sarah Jane Kavanagh as executive assistant. Kavanagh said they are planning to build the team over the course of the next 12 to 18 months.
About the name, Kavanagh commented: ‘It is fair to say the decision to leave Killik was the most difficult decision, naming the new venture was a close second.
However, Harry Potter aside, the name Patronus from the original Latin is a person who stood as a protector to another who was called his client. It struck a chord