Pennington Partners 1st Quarter 2022 Newsletter
Clients, Partners, and Friends,
Welcome to the first edition of the Pennington Partners newsletter! Over the past few years, our firm has experienced incredible growth as we’ve developed new services, hired fantastic talent, and expanded our offerings to better fit the evolving needs of our clients. As we head into 2022, we expect this growth to continue and so we wanted to take this opportunity to keep you up to speed on the both the trends that are defining our industry, our perspectives on them, and what’s happening here at Pennington.
To start, we’ll take a look at an important yet underappreciated tax-advantaged product: Private Placement Life Insurance (PPLI). For high-net worth investors and their families, this is a policy that can be highly effective and worthwhile to consider.
What Is PPLI And Why Does It Matter?
What Is PPLI And Why Does It Matter?
PPLI is a life insurance product that essentially converts a very tax-inefficient investment - such as a hedge fund - into a very tax-efficient one for HNW investors. By placing the assets within a life insurance policy, the strategy essentially neutralizes the impact of current income. If utilized in conjunction with an irrevocable life insurance trust, where families are able to grow their investments both income and estate tax free, PPLI can be extremely effective.
Similar to variable life insurance policies, PPLI is able to make investments with the goal of building significant cash flow over time on a tax-deferred basis. Like Private Placement Variable Annuities (PPVA), PPLI is able to offer limited partnerships, hedge funds, and private equity funds, along with a variety of very low cost investment options – in contrast to traditional investment options that are more limited in a typical whole life insurance policy.
Pennington has access to over 200 investment options including credit strategies, hedge funds, private equity, and traditional investment options for private placement portfolios. For families that are looking to invest more than $20M in either a PPLI or PPVA, Pennington has a team of world-class advisors where each family can hand select the “right” partner to build a bespoke portfolio for the family.
Interested in learning more? Feel free to send us a note at info@penningtonptrs.com. You can also learn more about our perspectives on PPLI by reading our latest whitepaper, available on the Pennington Partners website.
Pennington Partners’ Market Outlook
Private Credit has seen increase growth in the past decade and can offer attractive cash yield along with low correlation to traditional investments. But what’s on tap for 2022? In his latest white paper, Ed Goldstein, Portfolio Manager for Pennington Alternative Income Fund, shares his recent findings and discusses how utilizing private credit in a portfolio can enhance yield while lowering volatility.
What’s New At Pennington?
As mentioned briefly, we have been busy expanding our team and creating new products and services. Importantly, we announced in December the addition of Katherine Frattarola to our Advisory Board. Katherine brings over two decades of dedicated financial services experience to Pennington, having served most recently as Chief Marketing Officer for PURE Group of Insurance Companies – a role she was in for over three years until the company's successful sale to Tokio Marine Holdings in 2020 for $3.1B.
Additionally, we also announced the addition of Graham Bachman earlier this month, who joins us as Managing Director. Graham joins us from Context Business Lending, a specialty finance fund that provides customized working capital solutions to lower middle-market companies, and will focus on business development for Pennington.
Awards And Recognition
We are pleased to share that Pennington Partners has been shortlisted for multiple categories in several prestigious industry awards. First, our firm has been named a finalist in the 9th Annual Family Wealth Report Awards for Best Multi-Family Office (up to and including $2.5 Billion in AUM), and our founder and CEO, Brian Gaister is a finalist in the Rising Start Under 40 Category. Additionally, we have been shortlisted in the Private Asset Management Awards for three categories: Best High-Net Worth Investment Platform, Best Multi-Family Office Under $10 Billion, and Best Family Office – New Innovations. Final decisions for both of these awards will be announced in the coming months, and we are honored to make it to the next stage.
These award announcements exemplify our commitment to providing the most compelling, experienced and thoughtful counsel available, while offering tailored solutions that are uniquely designed for entrepreneurs and wealthy families. And most importantly, our firm has grown exponentially under Brian’s leadership, as we’ve launched new services that are unmatched among other multi-family offices in operation. There is no question he deserves to be named a rising star in our industry.
Lastly, we have been pleased to share our opinions with a number of journalists on the trends that are defining our industry. Below is a sample of a few articles we’ve shared contributed to most recently.
In the News
