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Moving Downstream |
rffrydr
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Joined: 30 Oct 2005
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 Posted: Mon Jan 28, 2008 10:06 pm Post subject: Moving Downstream |
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...And out of the mainstream:
| Quote: | Mainstream firms to lose out as trustees seek absolute returns in 2008 - Hewitt
Fund managers predict that boutiques will take the market share away from mainstream investment houses in 2008, as pension funds continue to focus on alpha generating strategies.
LONDON (Thomson IM) - The demand for active management and absolute return-generating strategies will lead to independent investment boutiques taking market share from mainstream investment houses in 2008, according to 65 pct of fund managers in a survey by Hewitt Associates.
The survey found 95 pct of managers expect pension funds will continue to focus on absolute return strategies in 2008.
Hewitt said 35 pct of all manager selections in 2007 focused on absolute return strategies, including hedge funds.
In contrast, a meagre 5 pct of managers surveyed predicts a resurgence for passive investing this year.
Hewitt believes trustees will continue to look for skilled managers who can consistently add value.
Andy Tunningley, head of Hewitt's UK investment practice, said Hewitt has long demonstrated its support for absolute return strategies and active management through its unconstrained mandates and allocations to 'carefully selected hedge funds.'
'Our clients' focus is on appointing talented investment managers, regardless of the size of the organisation,' said Tunningley.
Another finding among the seminar audience was that 65 pct of fund managers agree that pension funds will engage in more risk hedging activity than they currently employ.
Tunningley said: 'We are not surprised by the view that schemes will seek to hedge risk more fully.'
He said the firm is 'proactively speaking to clients' to ensure that risk, in relation to both investment and funding, is evaluated and understood.
'This might mean reducing or removing risks, but in many cases will involve retaining or even raising the level of risk being run,' said Tunningley.
By James Molony: +44 (0) 20 7422 4926; james.molony@thomson.com |
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