Making money in a bull market is child’s play but the real time for an investment house to prove its worth is when economic conditions become difficult, the investment head of a new UK portfolio service says.

PFP Group, an investment firm with offices in Harrogate in Yorkshire and London, said it has won UK regulatory clearance to set up a discretionary portfolio management business, which is due to start operations early in June. The new business will be called PFP Wealth Management.

The new business will focus on wealth preservation and delivering absolute returns regardless of wider market behaviour, which is a compelling proposition when markets are sluggish or falling, Tim Price, director of investment at PFP Wealth Management, told WealthBriefing.

“A difficult market environment is a wonderful opportunity to differentiate over investment performance. If you can deliver returns that clients have every reason to be sustainable, that is a fantastic differentiator,” he said.

As part of the focus on absolute returns, PFP will adopt an “unconstrained” approach to investment, using third-party funds where necessary as well as investing directly in stocks and other asset classes, Mr Price said.

“Our primary concern is wealth preservation first and secondly, meaningful absolute returns,” he said.

About 12 people – investment managers and analysts – work in PHP’s research team. Wealthy individuals, investing at least £250,000 ($495,000) and small institutions are being targeted as customers, Mr Price said.