Dutch money managers are losing out in their own back-yard to foreign investment houses which now control over 50 per cent of Holland’s €528bn pension fund assets.

Strong equity performance and market resilience in the face of adverse news suggests we are back in bull market territory, although investors remain cautious.

The growth benefits of an effective pan-European platform for small- and medium-sized enterprises (SMEs) are estimated at up to 0.6 per cent of the EU’s GDP (or, as much as €56.63bn), an independent study by Oxford Analytica has claimed. Up until now efforts in this direction have been “sub-optimal”, claimed the report.

New mark-to-market accounting rules are prompting many Continental European pension funds to shelve plans to shift their assets from government bonds to equities and other potentially higher-yielding investments such as hedge funds.

Despite increasing investment in real estate by European pension funds in 2004 and 2005, the current average allocation of 6.5 per cent in Europe is viewed as being below an optimal exposure of a 10 to 15 per cent weighting.

Private equity is still viewed as a key alternative asset class by UK institutional investors, with the proportion of total assets under management (AUM) allocated to private equity expected to rise over the next two to five years. However, the actual number of institutions investing in the asset class is projected to decline.

The days of caring and sharing are over, as managers embrace specialisation and a core-satellite approach. But how will this affect fund house structure?

Despite negative signs from the oil futures market, the CAD has plenty of backing from other sources that it will continue its strong run, says Neil Mellor.

Investec chief executive, Hendrik du Toit, insists that the mid-sized firm is less concerned about raising assets and more focused on perfecting the products it offers. He talks to Henry Smith about surging equity funds, poor bond performance and new projects in the pipeline.

The suggestion that medium-sized asset managers are an endangered species gets short shrift from Hendrik du Toit, Investec Asset Management’s, youthful-looking and feisty chief executive. Although he concedes that most medium-sized investment houses will not survive, he maintains that mid-sized firms can also be winners.

“Most will be losers, but I think that the majority at the bottom end of the scale are in that position, while at the top end a number of people have huge problems in managing their firms,” he says.

Philippe Lespinard, BNP PAM’s CIO, wants to make a profitable assault on the UK bond market by finding a local partner. Similarly, he is seeking on-the-ground expertise for the firm’s ventures into US, Asia and Russia, reports Henry Smith.

BNP Paribas Asset Management (BNP PAM) is not losing sleep over its recent unsuccessful bid to buy Deutsche Asset Management’s bond business.

After weeks of uncertainty following the German general election on 18 September, Angela Merkel has been appointed the new German chancellor. Rather than governing in tandem with its long-term ally, the liberal Free Democratic Party, Ms Merkel’s Christian Democratic Union appears to have been forced into a “grand coalition” with the Social Democrats.

US financial markets haven’t been left wanting for bad news over the past few months. Already stretched energy supplies have been tightened further by damage to oil production and refining facilities from two destructive Gulf Coast hurricanes.

Costs to reconstruct New Orleans and other storm-ravaged areas look set to expand an already big federal budget deficit. Inflationary pressures are building, and the Federal Reserve is prepared to combat them by continuing to hike interest rates in coming months.

Latin America is basking in the self-confidence, which comes with strong fiscal positions and surging growth rates. Buoyed by tightening spreads, governments have embarked on a broad range of reforms with varying degrees of success. Detractors dismiss these efforts as insufficient.

A glance at most indicators of the Asian (ex-China) economic cycle shows that it has remained firmly in the grip of the US. Exports and production saw a clear rebound from 2002 on the back of the US recovery but then experienced a clear deceleration from mid-2004 as the US cooled from its super-normal growth rates.

But business confidence is now pointing to a future rebound in regional activity.

Two factors appear to have been lifting Chinese growth in recent months. First, the rebound in US confidence/activity appears to be feeding through into China.

eFX may have seen a dramatic increase in the number of people using it, but as these numbers swell software providers are coming under pressure to provide an electronic solution that is inexpensive, efficient and can sway those not currently enamoured by it, writes Paula Garrido.

The interest that exchange traded FX futures is seeing from corporations, asset managers, hedge funds and retail investors shows how it has developed over the years. However, CME’s position is now being challenged by Eurex, which is spurring competitive prices, writes Paula Garrido.

Investors have already switched on to the idea of e-trading foreign exchange, but banks are responding to demand by creating ever more sophisticated platforms to respond to client needs, writes Jake Smith.

Rick Sears of CME examines how global financial managers are utilising foreign exchange to boost their returns and how electronic FX trading is transforming the marketplace.

Ray Dalio explains the various strategies on offer for those who wish to hedge their currency exposure – the prudent thing to do when international exposure reaches 15 per cent of a portfolio.

Fred Francis puts the case forward for outsourcing securities trading and settlement and the functions they perform.

Currency managers have worked hard to make the traditional perception of currency as a ‘difficult’ topic as out-of-date as they can, writes Peter Wakefield.

As I noted at the very start of this article, there has been enormous growth in currency management in the last year or two, and it is natural to wonder whether this may reduce or eliminate the return opportunities currency offers as a result.

While the drop in the performance levels of fund of hedge funds may have led to a slump in asset growth, they still undertake an important function on the operational side. However, this decline can be viewed as a sign that it is developing into a mature asset class, writes Paula Garrido.

Carl Dunning-Gribble of fund of funds CA-AIPG outlines the importance of staying ahead of the competition while maintaining capacity and creating a niche in a crowded environment.

Unlike the crowded Europe and North America private equity markets, which have become saturated after increased pension fund appetite, Asia offers real opportunities for growth, writes David Morley.

As consumers become more and more sophisticated, and their relationship with UK financial services increasingly strained, it is down to the industry to seize the initiative and offer trustworthy products with choice and that cater for the varying needs of individuals, writes David Curtis.

Increased competition has meant certain types of ETFs have fallen out of favour. However, astute investors are merely seeking more specialist lucrative avenues, writes Gerry O’Kane.

WestAM has gained the edge in countries converging into the EU by using their own customised benchmark, which doesn’t have as much exposure to Russia as the MSCI emerging Europe index, writes Paula Garrido.

Why would Nymex start an open outcry pit soon after its competitor IPE made a successful move to e-trading? It’s what the customer wanted, says Nymex.Roger Aitken reports.

Is an integrated multi-asset class trading electronic platform merely a pipe dream? Roger Aitken listens to industry leaders on whether such a product is attainable and what the current level of demand is.

In light of the obstacles to acquiring the London Stock Exchange, the pursuit of efficient links between stock exchanges might prove a more fruitful alternative, writes Roger Aitken.

Automation is now increasingly being seen as essential, but there is still reluctance from the buy-side.Henry Smith reports.