Carbon emissions by companies is an important risk factor investors need to take into account when constructing their investment portfolios. As a result of the introduction of different regulations, including the EU Emissions Trading Scheme (EU ETS) in 2005, carbon emissions are now a real financial issue with a real price.

Under current market conditions, bond investors might want to consider adopting directional strategies that have the potential to make money even when markets fall.

According to Baring Asset Management, as the economic environment becomes less supportive of fixed income assets, using strategies that aim to take advantage of upward and downward market movements by using derivatives and going short could be an attractive option for investors.

Despite disaster recovery programmes having been initiated by many firms following the September 11 terrorist attacks, scenarios for dealing with a failure of key securities market players and intermediaries have not been addressed in most markets and appropriate responses remain to be formulated, a newly published report highlights.

The chairman of Société Générale Asset Management maintains that anything a niche player can do a large multi-specialist investment firm can do better. And as pension fund markets develop, he claims investors are also realising this, writes Henry Smith.

The UK’s Railways Pension Scheme isn’t exactly steaming ahead with its switch from balanced to specialist management, due to the number of funds that it oversees. However, the specialists are ensuring more names but fewer moving parts, writes Paula Garrido.

After months of consecutive rises, many major equity markets throughout the world fell sharply in May. Because the falls were primarily a result of nervous investor sentiment rather than deteriorating fundamentals, the size of the falls came as a surprise to many market participants.

As US Federal Reserve chairman Ben Bernanke assumes his role as successor to Alan Greenspan, he also faces the re-emergence of volatility in global markets.

The recent sell off in Latin American equity markets was largely triggered by fears of further rate hikes by the Federal Reserve in the US. However, investors must now beware a rollover in commodity markets, a pick up in risk aversion, and perhaps most importantly, the risks around the electoral cycle.

Most of the major risks in the global economy emanate from structural imbalances in the developed world, not in the emerging world. More than that, the very definition of being an emerging country may be construed as conveying some protection as what risk exists is already priced in (and often significantly over-compensated for).

Contrary to market predictions after the appointment of an industry hardened US treasury secretary, the dollar is looking buoyant, writes Neil Mellor.

Institutional investors are recognising the flexibility and increasing sophistication of CDS, and new products are being created to satisfy this appetite, writes Elizabeth Cripps.

Institutional investors are realising the benefits of commodities as long-term portfolio diversifiers, despite the recent volatility and inflows of hedge fund ‘hot money’, writes Paula Garrido.

Despite recent market volatility, institutional investors’ interest in commodities continues to grow. Since the end of the last decade when oil prices started rising, investors from across the world have been looking at commodities as a way of diversifying their portfolios and sources of return.

Wojtek Nabialek shows a number of ways of dealing with asymmetric returns in a portfolio to allow for a consistent risk/return analysis. These devices allow investors to better understand risk.

As pension funds shift their focus, the fixed interest environment is becoming more complex to accommodate the growing demand for more exotic vehicles, writes Ceri Jones.

Craig Hurt, director, fixed income and liability driven investments at Axa Investment Managers, speaks to FT Mandate on the benefits of fixed income products including security, liquidity, transparency and duration.

Market volatility has a greater impact on small and medium-sized stocks leaving large caps to benefit as pension funds seek to climb the market cap ladder, writes Ceri Jones.

There are more reasons to invest in the US than you may think, says Jean Maunoury, head of US, Asian and emerging market equities, long-only investments team, of Natexis Asset Square.

Portable alpha strategies can be an efficient and cost-effective solution to increase expected returns and improve portfolio diversification. But the process, cost and risks are complex, so trust in managers is essential, writes Paula Garrido.

Portable alpha is becoming increasingly popular as investors look to isolate the risks inherent in investing in a benchmark from the returns available from good stock picking.

Ray Dalio of Bridgewater Associates explains how alpha overlay can act as a replacement for traditional active management and how this theory is fast becoming a reality.

Jim Gollan, CEO of pan-European exchange virt-x welcomes the pluralism of choice and competition in stock exchanges. He talks to Roger Aitken about catering to users’ needs.

The Asia Pacific region, which lags the US and Europe in the uptake of algorithmic trading, is slowly overcoming the particular hurdles to its adoption, says Roger Aitken.

Ashok Shah, chief investment officer at London & Capital, speaks to FT Mandate about the innovative technology in algorithmic trading and how more sophisticated investors are coming into the market.

François Banneville, deputy head of global program trading, Société Générale Corporate & Investment Banking, speaks to FT Mandate about the beauty of managed algorithmic trading.

Tax reclaim was often seen as an ancillary service, and due to its administrative nature and the heavy drain on fund managers’ resources, was often overlooked.

Increased demand for alternative assets from institutional investors has sparked fears that offshore aspects of fund administration may increase the operational risk, writes Henry Smith.

The entry of hedge funds into FX, in an attempt to secure liquidity, has fuelled investment in technology and a debate about the value of the new inflows, writes Giulio Pignatti-Morano.

Fund administration is developing, but in favour of the larger managers who can use the increasingly complex investment style, more regulation and new demands to their advantage, writes Gerry O’Kane.

The ‘lift-out’ days of old have moved on, since outsourcing providers stood up to being forced into maintaining multiple systems on one platform. Gerry O’Kane charts the modern outsourcing landscape.

As well as offering low volatility, real estate funds also generate returns that offer protection against inflation. The Reifs market is maturing and Luxembourg is emerging as its home, writes John Wantz.

Henry Smith and Roger Aitken quiz leading industry figures from across Europe on the biggest challenges facing fund administrators today including building capacity and automation.

Henry Smith: In the battle to grow market share, what sort of pressures are fund administrators under to create new value added services which can command a premium?

Germain Birgen, head of global fund services at HSBC Securities Services (Luxembourg), addresses FT Mandate’s questions on the current issues affecting fund adminstrators.

The costly nature of processing trades in cross-border funds is exacerbated the varying demands from different countries that make automation difficult. But change is afoot, writes Ivan Nicora.

As reality bites in the fast expanding transfer agency business, the regulatory and technical requirements force many firms to consider the outsourcing option, Gerry O’Kane reports.

Will an STP technological solution prove ever-illusive and what tactical approaches can transfer agents take to cement their role? Roger Aitken and Henry Smith bring industry experts into the debate.

Roger Aitken: What does the industry need to do to maximise the benefits of differing transfer agency models in Europe?

Germain Birgen, head of global fund services at HSBC Securities Services (Luxembourg), reveals his thoughts on STP, the evolving role of transfer agents and compliance risk.