...One of the key hurdles all managers face is the investor interview, when the focus is not on the fund or strategy, but on the manager’s ability to sell him or herself. While managers are typically comfortable discussing their investment thesis and related activities, they are markedly less able to articulate the personal and intangible details about which investors want to learn more.
To the extent that high-frequency trading is analogized to 'insider trading,' it may be in trouble with securities regulators but still in the clear with commodities regulators. After all, the latter do allow hedgers to use non-public material information to protect themselves. But Gregory Scopino doesn't believe pinging and related HFT practices should be in the clear with the CFTC at all.
As the CEO of AIMA, Jack Inglis, said: Many pension-fund trustees "are asking questions about their existing or prospective hedge fund allocations. Rarely has there been such demand for a realistic assessment of the benefits – and also the risks – associated with hedge fund investing.” The AIMA and CAIA are working together to meet that demand in a series of papers.
Guest columnist Don Steinbrugge, CFA, surveys institutional investors and hedge funds to find out what the top trends may be for 2015.
The new survey from Natixis tells us that a lot of asset-managing institutions think their industry as a whole has been quite slow about moving in the direction of liability-driven investment strategies. Also, more than half believe traditional assets are too correlated to provide them with the diversification they need.
The royal family in Qatar, the House of Thani, just took direct control of the emirate's sovereign wealth fund. Also, that fund just invested big in Uber, confirming its reputation as perhaps the worlds most aggressive deal-hunting institution.
The most intriguing revelation in the exchange of briefs between the State of New York and Barclays appears in a humble footnote, where Barclays seems to concede that an employee was pressured to change an internalization number. But it was just the once....
Guest columnist Peter Urbani looks at emerging managers and why they may be re-emerging and bringing alpha with them.
Should investors, especially institutional investors, push back (or push back harder than they have so far) against the fee structure preferred by those whom they pay to manage their money? And is the recent announcement from CalPERS such a push?
Guest columnist Andrew Beer looks at the changes in institutional investing.
Guest columnist Don Steinbrugge, CFA, looks at some of the potential reactions to CalPERS' leaving hedge funds.
Guest columnist Charles Skorina looks at the five-headed NYC pension system with its new leader, Scott Evans.
Guest columnist Diane Harrison looks at what advisors think of hedge funds.
For an investor allocating slots in its portfolio to hedge funds, the draw of recent outsized performance can be powerful. Thus, the temptation to chase winners. But two members of the Hedge Fund Strategies Group at Commonfund caution against it.
Private foundations have "regained solid financial footing" in terms of their investment returns over the last two years especially, after the shaky years that preceded. Their mission-related spending has accordingly increased.
The Skorina Report is Surfing the Age of Asset Management: Will the tide of global AUM lift all asset-management boats?Jul 31st, 2014 | Filed under: Guest Posts, Institutional Investing, The Skorina Report, Today's Post
Charles Skorina looks at the future of CIOs and with rising AUM and sees a forecast calling for sunny and bright. Maybe it's finally time to break out the shades!
If such institutions as the ECB keep rewarding indebtedness, then over time they get their way. They'll get a lot of deal making, even if it amounts to a frenzy. Then investors will demand funds that play to that frenzy.
In Asia the high-net-worth population still consists largely of the first-generation wealthy. So: what are these Asian entrepreneurs looking for in their private banking services? That is one of the questions McKinsey considers.
Had the plan not received final IRS approval, the benefits part of the Times/Guild contract would have reverted to a DC plan, and this would have been yet another exhibition of how defined contributions is sweeping all before it. But the IRS did approve, and that broom is for now back in its closet.
Guest columnist Donna Howe examines diversity at the board level. Does it make a governance difference?
One takeaway, from the point of view of the managers, is that a close engagement with institutional investors requires a lot of time and effort, and those commodities have to be budgeted. How to handle the circumstances of industry maturity is an individualized call.
Guest columnist Don Steinbrugge looks at why allocators continue to invest in hedge funds, even when the media thinks they shouldn't.
Jeff Malec, CAIA, looks at why large hedge funds have all the fun and get all the money.
Europe's pension fund managers embrace LDI quite generally, and many embrace the "dynamic" version of that strategy. But four scholars at EDHEC find it curious they don't do so for the right reason -- they don't seem to see LDI as the risk-management imperative it is.
Guest columnists Andrew Beer and Michael Weinberg look at the opportunities that lie in the largely untapped alternative mutual fund markets.
Doug Friedenberg talks about investing in the climate and what real investors can and are doing with it.
Longevity hedging transactions are growing at an exponential rate in the UK. We focus on one case study in such transactions that might encourage (cautious) optimism about the tractability of demographics.
Sophisticated institutional investors contracting with outside active managers can get positive alpha out of the U.S. equities markets, despite the arithmetical and a priori reasons for skepticism.
Charles Skorina looks at the implications of El-Erian "disappearing" from PIMCO.
Unless Reuters has been utterly misled, a recent report there suggests that Europe's greybeards are considering an astonishingly bad approach to the insolvency of their banking system: soak the pensioners.
Roving columnist at-large Douglas Friedenberg reports on the Investor Summit on Climate Risk, NYC.
Deloitte's pie graphs emphasize the degree to which both hedge funds and PE vehicles have become dependent upon institutions in general, and detached from the retail market. But Deloitte says that 2014 "will likely see additional efforts by alternative fund managers to engage the retail investor base by taking their alternative investment strategies mainstream."
The Skorina Report looks at the returns of the Ivy Leagues, which show allocation is not destiny.
Higher-education endowments are sticking with the “endowment model,” that is, their asset allocations remain stable. For example, in 2012, the surveyed institutions had 15% of their total AUM in domestic equities, 16% in international equities. In 2013, those figures were only slightly higher, 16% and 18% respectively.
The latest in a series of annual reports from Rothstein Kass on women in the alternatives world adopts a somewhat less cheery tone than did that of last year. No longer is the dominant metaphor a "tipping point." Now it's a marathon.
In 2010 AlphaMetrix held a conference in Miami with Harry Markopolos as the keynote speaker. Markopolos' claim to fame is that he told the regulators about Madoff''s Ponzi Scheme, but his words fell on deaf ears. In 2013 AlphaMetrix, which claimed to the be the transparent antidote to Madoff stood accused by the CFTC of moving money in ways it ought not and in 2014, the principals of the firm are asking for a jury trial. It is indeed a tangled web and it is unlikely to be un-weaved any time soon.
Guest columnist Don Steinbrugge provides his thoughts on what the coming year will bring for hedge funds.
The numbers of undead mutual funds in China has created a sharp disparity between the fund count and the AUM count. Since no one ever drops out, the fund count only goes up.
For pension managers these days, decision making is about managing a glide path that doesn't become a fiery crash. In appealing to such clients, consultants shouldn't think of themselves as sales people selling particular products in separate boxes.
Guest columnists from Tesseract Asset Management look at investor behavior and risk management.
NACUBO President and CEO John D. Walda and his Commonfund Institute counterpart John S. Griswold said in a statement, “the data concerning alternative strategies will bear watching as more colleges and universities report their FY2013 results.”
Guest columnist firm Tesseract on charting proper risk management in rapidly changing seas.
Two institutional investors challenged the legality of a forum selection bylaw favoring the management of Chevron Corp. They have lost this battle in the Delaware courts. How significant is that loss?
Numbers indicate that specialist advisory firms manage nearly twice as many assets as the industry average. As Cerulli Associates observes in a recent issue of The Cerulli Edge, this "validates the strategy."
The hedge portion of a liability-driven portfolio can be dominated by long-duration fixed income instruments. One of the points of a new Cerulli report is that by offering those, asset managers can get a valuable 'in' with the sponsors of DB plans, to whom LDI appeals.
Guest columnist Diane Harrison looks at the U.S. JOBS Act for what it is...and isn't.
Comparing the 2011 and 2012 data, some correlations that seemed clear in the former year either disappeared entirely, or become a good deal blurrier, in the 2012 data.
The David Swensen inspired "Endowment Model" came under heavy criticism in 2009-10. More recently, opinion has mellowed, and now comes a project, the Portfolio Whiteboard Project, in which the participants view Swensen in a spirit as collegial as it is critical.
Guest columnist David Friedman looks at social media as a strategy for reaching the ultra-high-net-worth market.
Cerulli reminds us that risk-on/risk-off environments now alternate with dizzying speed. Even within the course of 2013 there has been a swing from cautious optimism to just-plain cautious.