Despite the city boasting the largest number of millionaires in Germany, many are unaware of the importance of Hamburg’s financial industry. Hamburg happens to be the birthplace of the first banks in Germany and is home to the first ever German stock exchange, dating back 450 years. Its banking sector still employs 25,000 people.
When you talk to north German asset allocators, a recurrent theme emerges: their pride in Hansa: the defense and trade pact formed in the Middle Ages amongst various towns and cities along the North and Baltic Sea. In fact, many investors in Hamburg adhere explicitly to a Hanseatic investment strategy.
Nils Petersen, a fund manager from TOP Vermögensverwaltung, explains: “Our strategy is a traditional style of investment. We have clients from the south of Germany that expect us and other northern investors to have the Hanseatic approach to asset allocation”. In fact, the names of quite a few investment firms based in Hamburg refer directly to Hansa, such as Hanseatische Portfoliomanagement GmbH. Its director, Ulrich Bendfeldt, reveals what the Hanseatic investment style boils down to: “We picked our name very carefully, Hansa symbolises trust and reliability”, he says.
Hansainvest’s head of investment strategy, Jörg Löschen explains that, “Hamburg investors are very much in touch with reality. If you work in Frankfurt, the only people you meet are those that work in the finance industry. However, in Hamburg we are surrounded by harbour workers, large manufacturing companies and journalists”.
This down-to-earth mentality prevents investors from contracting Realitätsverlust, or loss of reality, as most Hamburg-based investors avoid investing in what they perceive to be difficult to comprehend risky financial instruments such as alternatives or derivatives. It is for this reason, some of them believe, that Hamburg was not as badly struck by the financial crisis in comparison with other major cities in Germany. Perhaps, if Deutsche Bank’s headquarters had been in Hamburg rather than in Frankfurt, would it be facing the same troubles it is now?