While the giant American pension systems are refuting South Korean claims and keeping faith with US treasuries, European schemes are keeping their own counsel, reports Nat Mankelow.

Credit spread products and large-cap equities are looking particularly attractive, according to an optimitstic prognosis from the US supergroup. Martin Steward reports.

Increasing risk aversion as a result of the liquidity crisis has hit small and mid-cap stocks hard, writes Aymeric Poizot.

The liquidity crisis that started in July 2007 in the US real estate market has triggered a “flight to quality” phenomenon, which has led investors to move their capital to “safer” assets.

It seemed like a good idea at the time, but the single, integrated structure is now being questioned by many banking and investment groups.

The single, integrated, banking structure - trail-blazed by leading US bank Citigroup after its purchase of Sandy Weill’s Travelers insurance business ten years ago - has taken something of a battering in recent months.

Corporate bonds, particularly the higher quality investment grade ones, look cheap on any historical measure. In the UK, investment grade financial sector bonds are trading at levels that indicate that one in five banks will go bust in the next five years.

The US economy has now been slowing for some time and there are mounting fears of a recession. However, we believe that by the end of 2008 the economy could already be on course for a recovery, as the lagged effects of the recent action by the Federal Reserve and the proposed fiscal stimulus package from the Bush administration feed through.

Despite current market volatility, economic growth across Latin America is still strong and the region remains attractive for investors across the globe. Both public and private sectors have very ungeared balance sheets, while the region as a whole continues to run a current account surplus.

As concerns continue to grow around the US economy and European property market returns slow, Asian property markets will increasingly be seen as an alternative destination for western investors.

RCM CIO Andreas Utermann tells Henry Smith why he favours riskier assets for long-term liabilities, about the “Grassroots” network, and his disappointment at the take-up of 130/30.

Pension funds with long-term liabilities should not dismiss index-benchmarked equity investing as yesterday’s news. According to Andreas Utermann, global CIO of RCM, the $168bn (€109bn) active equity arm of Allianz Global Investors, the promotion of outcome-oriented investment products as a universal funding panacea, fails to recognise that younger pension schemes might be better advised to have a high weighting in equities.

The Pension Protection Fund supports UK retirees whose final-salary pension schemes have collapsed under their sponsors. But it also insures 7800 schemes with investment risk exposures that are completely out of its control. Martin Steward reports.

Awash with liquidity, GCC members are investing in the wider Middle East and North Africa region and even looking towards India and the far East. Peter Guest reports.

From the 51st floor of the Emirates Hotel Tower in Dubai, guests can see how close they are to the desert. Directly below is a single line of skyscrapers. In their shadow is a rough spread of low-rise, sand-coloured houses, and behind that, nothing.

Nat Mankelow talks to Egyptian Minster of Investment, Dr Mahmoud Mohieldin, about aims to promote and establish the country as a location for financial services.

Dr Mahmoud Mohieldin, Egypt’s Minister of Investment, has much to occupy his working day. There is a serious bread shortage in the country, a situation caused by high wheat prices worldwide and persisting despite a government subsidy.

Lending volumes are down as syndicated loans continue to suffer from the liquidity crisis with cash from institutional investors having dried up. But as Nat Mankelow reveals, new capital from uncorrelated sources could provide a solution.

With longevity making up an increasing proportion of pension scheme risks, new and innovative capital market solutions are being developed to transfer these out, reports Martin Steward.

The UK’s new framework for covered bonds should provide a boost to the market in the long term, although the timing of the launch has been unfortunate, writes Christine Senior.

The exorbitant fees charged by some funds of hedge funds are leading to calls for different fee structures and even direct investing. But the funds themselves argue that what they offer is even more important given the market volatility. Ceri Jones reports.

A new toolkit from the NAPF – including a detailed annual survey of user satisfaction – is meant to bring the assessment of investment consultants out into the open. But are they the right tools? Martin Steward reports.

Institutional investors have just started disaggregating alternatives into strategy-specific allocations and separating alpha and beta exposures. Hardt Group’s founders were talking up these trends two decades ago, and in 2004 they modelled their alternative investment

platform to enable investors to build portfolios on these principles. Martin Steward reports.

A second generation of ETFs claims to offer an advantage over traditional market-cap weighted equity indices. Ceri Jones reports.

The second half of 2007 was poor for enhanced indexing funds. However, ‘truly scientific’ managers with new investment ideas could reverse this trend, while clients disappointed with paying active management fees may begin to switch. Ceri Jones reports.

The past few years has seen a proliferation in the number of indices available. At the same time this has been mirrored by the growth of the number of products in the exchange traded fund (ETF) market.

In the efficient world of European large-caps it is no surprise that systematic, quant-driven strategies abound. But models notoriously break down at market inflexion-points, and with more than one top fund undergoing recent personnel changes, understanding the balance between man and machine is more vital than ever, writes Martin Steward.

Jersey and Guernsey have been working together, steadily developing their appeal to the alternative investment fund industry. Elizabeth Cripps talks to the rival Islanders.

Significant developments on the shores of Jersey and Guernsey have won the islands international status when it comes to specialist fund domiciling – against all odds. Brett Allen of BNP Paribas Securities Services reports.

A drive for trade efficiency in foreign exchange markets has sparked renewed interest in equity-style electronic trading, explains Peter Guest.

In the first of a series of articles where Deutsche Bank provides expert insight into the developments and innovation in the eCommerce market place, Robert Flatley, global head of autobahn® Equity, discusses the growing demand for customised non voice services and the distribution challenge this presents.

Euro Millennium, which Nyfix launched in March, claims to be the first truly independent European ‘dark pool’. Peter Guest asks whether dark liquidity is a new phenomenon and looks at the confusion over the terminology that surrounds it.