Archives » 2007 » July - August

During a CEO panel discussion on the merits of specialist boutique managers versus large investment firms at the recent Fund Forum conference in Monaco, a question directed at the audience drew a telling response.

— Roger Yates, CEO Henderson Global Investors

The response by third-party fund administrators to some of the new investment products launched by asset managers has been “lamentable” according to Roger Yates, chief executive officer of Henderson Global Investors.

Apax Partners, Europe’s second biggest private equity group, has hit back at the industry’s critics in its 2007 report on the latest global private equity environment rankings from the Economist Intelligence Unit, Private Equity in the Public Eye.

— Andrew Smith, Goodman Property Investors

Product developers are responding to investors’ appetite for non-domestic property by looking ever further afield for opportunities.

— Scott Donaldson, Hymans Robertson

A variety of dishes can be found on today’s alternative investment menu, but as Scott Donaldson explains, the tastiest investments are often unavailable à la carte.

— Pascal Voisin, CEO Natixis Asset Management

Does Natixis Asset Management CEO Pascal Voisin have the entrepreneurial and leadership skills for success now that Natixis is a publicly quoted bank?

Pascal Voisin, recently appointed chief executive of Natixis Asset Management, is hardly an unknown quantity. The merger of the funds units of Natexis and Ixis is apparently the fourth of his working life, following his supervision of similar deals in France. The most recent one was between the fund houses of Crédit Agricole and Crédit Lyonnais. “Mergers are his profession,” says one colleague.

— Christian Dargnat, CIO BNP Paribas Asset Management

BNP Paribas Asset Management’s obsession with being one step ahead of the competition has seen a reshuffle of its capabilities in order to combine expertise. CIO Christian Dargnat speaks to Henry Smith about the revitalised firm.

Christian Dargnat is a man who conveys a sense of mission. “We are obsessed by the need to be permanently ahead of our competitors,” he says. Listening to him describe what he has done since taking over last September from Philippe Lespinard as chief investment officer of BNP Paribas Asset Management (BNPPAM), it seems he has played a leading role in the recent restructuring of the firm.

— Stan O’Neal, CEO Merrill Lynch

Stan O’Neal, Merrill Lynch’s CEO, is keen to focus on the positives when it comes to future prospects around the world, but he acknowledges that a buoyant market and an influx of liquidity can lead to a distortion in certain asset classes. Nat Mankelow reports.

The story behind the rise of Stan O’Neal, chairman and chief executive officer (CEO) of Merrill Lynch, which boasted a net income of $7.5bn (€5.5bn) in 2006 from revenues of £70bn, is considerably more humble than the lofty position he finds himself in today.

— Nigel Hankin, Investec Asset Management’s European Funds

In May, European equity markets (at least as measured by the MSCI) finally surpassed levels not seen since the height of the last bull market in 2000. That the losses of the bear market had finally been recouped seems an occasion for no small celebration and yet it passed largely unremarked.

— Robert W. Sharps, T. Rowe Price

A benign economic backdrop and the strong health of the US corporate sector are likely to continue to underpin positive equity market sentiment. Although moderating, we expect the US economic cycle to achieve a trend rate of growth through the rest of the year.

— Pedro Villani, ABN Amro Funds – Brazil Equity Fund

In Brazil, environmental, social and corporate governance (ESG) criteria are increasingly perceived by all stakeholders, including investors, as an important ingredient to corporate success.

— Dr. Jerome Booth, Ashmore Investment Management

Ten years after the Asian crisis, emerging markets are net creditors. This build up has been at the cost of foregone domestic investment. Reserves have been channelled into US Treasuries and other G7 bonds,

yielding less than returns on domestic investments.

Driven by the rise in exchange-traded funds and institutions increasingly seeking specific benchmarks, indices have been rapidly expanding into new areas, writes Tony Tassell.

As banks create new investment strategies, they are allocating considerable resources to setting up their own benchmark to measure it, writes Charles Batchelor.

Index providers are vying with each other to develop new products in the wake of increased liquidity in global equity markets. Kristen Paech reports on the products being constructed.

— Tohmé-Adet, BNPPAM

Expensive though they may be, exchange-traded funds, futures and options offer an alternative to passive approaches for index return seekers, writes Henry Smith.

Until recently the capability to offer tradable indices for alternative asset classes has not existed. But now, technology has caught up with demand, writes Nik Pratt.

An unconstrained approach to managing portfolios has led to a reassessment of how active managers view benchmarks. Outperformance is no longer enough, writes Joanna Chung.

— Margaret Gilbert, Greenwich Alternative Investments

As hedge fund allocations rise, using investable hedge fund indices could prove a cheaper way to gain exposure, but will they live up to regulatory scrutiny? Martin Steward reports.

Alternative methods for beating the benchmark are being touted, but many experts claim that investors should remain sceptical of their long-term staying power. Pauline Skypala reports.

Banks are hurrying to unveil hedge fund replication models to serve as investable indices. But doubts remain as to whether they can they produce adequate returns, writes Steve Johnson.

— Daniel McAlister, Ermitage Asset Management

Speakers at June’s WBR Commodity Investment Summit suggested that institutional investors are sold on the diversification benefits of commodities, but managers warned of the peculiarities of commodity beta and stressed that alpha should be mixed in. Martin Steward reports.

— Peter Marber, HSBC’s Halbis

Slim pickings in the fixed income space have forced investors to work harder for returns. Nat Mankelow reports on how institutions are seeking nimbler and smarter strategies.

— Mark Dwyer, Mellon Transition Management Services

The issues facing transition managers are not new, just more complex, and provided they can decipher these intricacies for potential clients, business can grow, writes Gerry O’Kane.

Asset managers are predicting a rise in interest rates over the long term, but experts claim this is merely normalisation, consistent with viable economic cycle. Elizabeth Cripps reports.

— Jonathan Stubbs, Citi

Faced with the challenges of structural changes in globalising markets, how does quantitative management respond dynamically? Quants professionals and academics discussed the topic at the annual Citi Investment Research Quantitative Conference. Martin Steward reports.

— Bob McDowall, Tower Group

Interest in FX trading has rocketed this year as its attractions as a diversifying asset class with exciting potential returns are increasingly appreciated, writes Ceri Jones.

— Susanne Willumsen, State Street

Complex collateral arrangements, IT reconfiguration and the potential for unlimited losses are just a few of the challenges purveyors of 130/30 funds will face, writes Christine Senior.

Fundamentally, F&C’s PF Far East Equity Fund takes a bottom-up stock picking approach, but it keeps a close eye on macro-economic developments and political machinations, writes Gerry O’Kane.

— Richard Balarkas, Credit Suisse

Europe is set to make more use of dark liquidity, partly due to competition between bourses, with the resulting cost implications likely limited to the short term, writes Matthew Craig.

Luxembourg’s taxation status makes it an ideal jurisdiction from which institutional investors can enter Europe’s real estate investment fund market, says Robert Manderscheid.

— Octavio Marenzi, CEO Celent

The indirect effect of the approaching implementation of MiFID is that Europe’s trading platforms have got their act together over guidelines. But what impact will these have? Gerry O’Kane reports.