Patrick Disney, SEI’s European head of institutional business development, said:
“In the past we had a polarised approach.” Investing institutions either had one manager and the problems of that manager not being good at every asset class combined with the ease of dealing with one organisation, or they had to manage lots of different relationships with specialists, he said.
“There is a growing acceptance of the fact that manager of managers can help with meeting liabilities,” he added.
Multi-manager products worldwide – including funds of funds and manager of manager products – experienced record inflows in 2003 of $680bn, according to research from Cerulli Associates.
Northern Trust’s assets are up 25 per cent to $527bn. “We are seeing terrific growth in manager of manager operations,” said Bev Fleming, head of investor relations at the firm. But part of the growth was down to the market rebound, she said.
ABN Amro’s nascent multi-manager product, a comparative minnow, has passed the E110m point and the firm is predicting strong growth for it, of up to 10 per cent. The range of funds is expected to win Ucits III approval this month, which should boost its marketability in Europe considerably.
Cerulli expects assets in multi-manager vehicles to grow 14 per cent annually until at least 2008. This growth will be bolstered by UK bank Abbey, which plans to switch its funds to multi-management. It recently farmed out its Ł160m (e235m) Scottish Mutual Opportunity Unit Trust, in equal parts, to Goldman Sachs Asset Management and Invesco.
RM
