Why is the Great Investments Programme Better Than Trusting a Fund Manager With your Pension?

For most investors, the pension is not a pot of money; it is a promise of dignity. How that promise is managed determines whether retirement is a life of freedom or anxiety.

Traditionally, the British middle class has outsourced that responsibility to fund managers - confident that professional stewardship would deliver prudence, diversification, and superior performance.

The evidence, however, tells a different story. The vast majority of actively managed pension funds underperform their benchmarks after fees, and many entrench conflicts of interest that prioritise distribution and retention over returns.

Why the Great Investments Programme Outperforms Fund Managers.pdf

Download PDF • 6.17MB

The Great Investments Programme (GIP) represents an alternative model: an evidence-based, transparent, and investor-driven system designed to maximise long-term, risk-adjusted growth while giving individuals control over their capital.

This essay argues that the GIP is superior to conventional fund management because it aligns incentives with outcomes, replaces opacity with transparency, and converts financial dependence into informed autonomy.

1. The Myth of the Skilled Fund Manager

The notion of “managerial skill” has been romanticised into a cultural truth. For decades, fund houses marketed star managers as oracles who could consistently “beat the market.” The data refute that claim.

The S&P SPIVA Scorecard (2024) shows that over 85% of UK equity fund managers underperformed their benchmark over ten years; for global equity funds, the figure rises to 90%. The few who outperform in one period rarely repeat it in the next. The statistical persistence of alpha is indistinguishable from chance.

Fees compound the problem. Active management typically costs between 1–2% per annum, which, over a 25-year pension horizon, erodes up to 40% of potential capital.

The result is an industry that captures rent from its clients while delivering index-minus-performance - a triumph of marketing over mathematics.

The GIP dismantles this myth by grounding every selection in empirical factors, not charisma - quality, growth, income, volatility (Sortino ratio), and valuation metrics (CROCI, P/E, and free cash flow yield). It is not a cult of personality; it is an algorithm of reason.

2. Transparency and Control: The Investor’s Revolution

Traditional fund management operates behind a curtain of complexity. Investors seldom know precisely which holdings they own, what risks they carry, or how their portfolio is benchmarked. Reports arrive quarterly, full of jargon, backward-looking charts, and selective narrative framing.

The GIP, by contrast, embodies radical transparency. Every stock is disclosed, every rationale explained, and every model portfolio stress-tested against inflation, drawdown, and market stress scenarios. The investor can see and verify why each holding exists.

This transparency matters because it restores the link between ownership and understanding. In classical finance, opacity benefits intermediaries; in the GIP, clarity benefits the client. Investors no longer surrender agency to a fund manager’s subjective judgement but participate in a framework of objective discipline.

As Nobel Prize Winner, Daniel Kahneman observed, “Transparency and accountability are the enemies of overconfidence.” The GIP institutionalises both.

3. Incentive Alignment: From Dependence to Partnership

The fund management industry’s incentive structure is misaligned with investor outcomes. Managers are paid for assets under management (AUM), not performance. The longer a client stays invested, the more predictable the fee income - regardless of results.

This model breeds inertia, not excellence. Advisers fear recommending fund switches (lest they jeopardise distribution fees or client confidence), while managers market reassurance rather than returns.

The GIP reverses the equation. Its objective is not to accumulate AUM but to deliver compounding intelligence: giving investors the frameworks, tools, and evidence to manage their pensions proactively.

The model portfolio structure - Quality 5+, ETF selections, and special situation ideas is open architecture: investors are free to verify, modify, and implement through any global brokerage platform.

In short, GIP earns trust through empowerment, not dependency. It is fiduciary capitalism without the middleman.

4. Empirical Superiority: Evidence Over Emotion

Performance data reinforce the argument. You can see the data for yourself at www.alpeshpatel.com/shares 

These are not outlier statistics; they reflect the advantage of systematic diversification and behavioural discipline.

By adhering to Nobel Prize validated factors (Fama–French, Thaler, Kahneman), GIP portfolios achieve higher risk-adjusted returns not through speculation but through consistency.

Traditional managers sell narratives; GIP sells probability.

5. Behavioural Finance: Protecting Investors from Themselves

Perhaps the greatest threat to pensions is not poor markets but poor behaviour. Studies by Dalbar and Vanguard show that the average investor underperforms their own funds by 1.5–2% annually through impulsive timing decisions - buying high and selling low.

Fund managers rarely solve this problem; indeed, their opaque communication often exacerbates it. By contrast, the GIP integrates behavioural feedback loops: drawdown simulators, portfolio stress tests, and transparent volatility data that encourage long-term thinking. Investors see how temporary losses fit within historical probability bands, reducing panic-driven exits.

In doing so, GIP converts emotional noise into statistical signal. It functions less like a black box and more like a behavioural coach, guiding rationality under uncertainty.

6. Ethical and Educational Capital

Beyond returns, the GIP performs an educational function that traditional funds neglect. It teaches investors why their portfolio behaves as it does.

This learning compounds: the investor becomes more discerning, less manipulable, and ultimately more independent.

In a world where pensioners increasingly face a crisis of trust from mis-selling scandals to opaque ESG claims education is ethical defence. The GIP reframes the pension as a partnership between knowledge and capital, not a surrender of control.

Moreover, it aligns with the democratic ethos of finance: spreading the tools of institutional investing to individuals. The Great Investments Programme, in this sense, is both product and protest - a protest against an industry that monetises ignorance.

7. Risk Management and Diversification

Traditional funds often claim diversification while remaining concentrated within a single style or region. The 2020s have exposed this flaw: many “global balanced” funds were effectively long US mega-cap tech.

The GIP’s structure combining quality-growth equities, dividend ETFs, and factor-diversified holdings mitigates concentration risk.

Its proprietary stress-testing (using Monte Carlo simulations and drawdown modelling) anticipates sequence-of-returns risk, the greatest hazard for retirees drawing income.

Where fund managers react, the GIP prepares.

Conclusion

Trusting a fund manager with your pension is an act of faith; investing through the Great Investments Programme is an act of evidence.

The difference is philosophical as much as financial. Fund management asks for belief in others’ skill; GIP asks for belief in data, discipline, and oneself. Fund management sells comfort; GIP builds competence.

To paraphrase Warren Buffett, “It’s better to be approximately right than precisely wrong.” The Great Investments Programme is designed to make investors approximately right — consistently, transparently, and on purpose.

For the world’s savers, that makes it not merely a better alternative to fund management, but a quiet revolution in who controls the future of their retirement.

Disclaimer: This article is for educational purposes only and does not constitute financial advice. Past performance is not indicative of future results. Investors should conduct their own research or consult a qualified financial professional before making any investment decisions.

Alpesh Patel OBE

www.campaignforamillion.com