Institutional Investing

Foundations: They’ve Taken a Blow from “Subdued” Markets

Sep 2nd, 2015 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Indexes, Institutional Investing, Liquid Alts, Performance, Analytics & Metrics, Risk management, Today's Post

Both private and community foundations depend heavily on U.S. equities. Indeed, domestic equities remained the bright spot while other strategies underperformed in 2014. A new report from a collaboration of the Council on Foundations and Commonfund provides food for thought about the reversal in foundation returns in that year. The Study of Foundations by this […]


When Underfunded Pension Funds Take Up Social Responsibility Investing

Aug 24th, 2015 | Filed under: Best Practices, Corporate governance, Institutional Investing, Legislation/Court rulings, Socially responsible investing, Today's Post

In November 2014, Scott Stringer, New York City's Comptroller, launched a campaign he called the Boardroom Accountability Project. Bernard Sharfman makes a case that this BAP is a good example of much that is wrong with institutional/activist investing today.


Hedge Fund Assets to Increase a Quarter Trillion Dollars by Summer of 2016

Aug 19th, 2015 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Media Coverage of Hedge Funds, Today's Post

Guest columnist Don Steinbrugge on why hedge fund AUM is set for an increase over the course of the next 12 months.


The Skorina Report: Risky Business–Chief Investment Officers and Public Pension Plans

Aug 16th, 2015 | Filed under: Alpha Hunters, Alpha Seekers, Alpha Strategies, Best Practices, Guest Posts, Institutional Investing, Risk management, The Skorina Report, Today's Post

Guest columnist Charles Skorina with a cautionary tale of greed and deceit and less-than-best practices at a large public pension plan.


Event-Driven Hedge Funds Rescued by Obamacare

Aug 11th, 2015 | Filed under: Alpha Hunters, Alpha Seekers, Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Today's Post

Obamacare's impact on the investment world may have been mitigated until very recently by the protracted and complicated litigation that the law immediately generated starting with its enactment in 2010. But now....


The Strength of Multi-Strat Is No Mystery

Aug 2nd, 2015 | Filed under: Alpha Hunters, Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Investment Management Fees, Today's Post

Credit Suisse Capital Services says that appetite has increased of late, among institutional investors, for multistrategy funds. Faille offers some thoughts as to why.


Crisis? Tempted to Flee to Shelter of Big Funds? Bad Idea

Jul 29th, 2015 | Filed under: Academic Research, Alpha Hunters, Alpha Strategies, Behavioral finance, CAPM / Alpha Theory, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Today's Post

The authors of a new study of the relationship between fund size and performance employ a database consisting of 7,261 funds and their performance over a twenty year period (1994 to 2014). Spoiler alert: size is bad. Especially in a crisis.


7 Messages Family Offices Give Emerging Managers

Jul 26th, 2015 | Filed under: Alpha Strategies, Emerging Managers, Family Offices, Institutional Investing, Today's Post

Guest columnist Diane Harrison examines the relationship between family offices and emerging managers and why some managers get money and why others don't.


‘Women of the Street’—Not Just Another War Story

Jul 22nd, 2015 | Filed under: Academic Research, Alpha Hunters, Alpha Seekers, Alpha Strategies, Institutional Investing, Retail Investing, Today's Post

Meredith Jones' book on investing in women takes it to the Street and comes back with some solid conclusions.


SBA of Florida Looks into Truth & Consequences of Activist Investing

Jul 16th, 2015 | Filed under: Best Practices, Corporate governance, Institutional Investing, Risk management, Today's Post

Florida's State Board of Administration deserves some credit for undertaking a recent corporate governance study. Even trying to look at the consequences of its proxy-contest votes over a period of up to five years after they are cast seems to have shattered a glass ceiling separating actual institutional behavior from common sense.


The Skorina Report: A Look at the New Investment Crew at NYU

Jul 9th, 2015 | Filed under: Alpha Hunters, Alpha Seekers, Featured Post, Guest Posts, Institutional Investing, The Skorina Report, Today's Post

Charles Skorina looks at the new crew at NYU.


SCOTUS on Copyright Means a Win for Fences: Loss for the Noosphere

Jul 6th, 2015 | Filed under: Institutional Investing, Intellectual Property, Today's Post

An idea for the hierarchical design of a platform's APIs, and a particular expression of that idea, walk into a bar. What's the punch line?


Farm Land: The Risks & Rewards of Buying Direct

Jun 7th, 2015 | Filed under: Farmland, Infrastructure, Institutional Investing, Real Estate, Today's Post

Guest columnist Andrew Smith, CAIA, examines the risks and rewards of investing directly in farmland.


How to Cut Hedge Fund Fees in Half-Part One

May 31st, 2015 | Filed under: Hedge Fund Fees, Hedge Fund Industry Trends, Institutional Investing, Performance, Analytics & Metrics, Today's Post

Guest columnist Andrew Beer takes on hedge fund fees. In part one of the series he looks at the investor aggregation model.


Top Hedge Fund Managers: They Aren’t Wizards, but They Are Masters

May 28th, 2015 | Filed under: Alpha Hunters, Alpha Seekers, Alpha Strategies, Book review, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Real Estate, Today's Post

For Faille, the stand-out essay in this collection of case studies, from CNBC's Maneet Ahuja, concerns Marc Lasry and Sonia Gardner, of the Avenue Capital Group. As Myron Scholes says in his afterword to this volume, Lasry and Gardner take returns from those whose demand for liquidity makes them willing to give them up.


What’s in a Copyright? Java API Case Before U.S. Supreme Court

May 25th, 2015 | Filed under: Institutional Investing, Intellectual Property, Technology, Today's Post

High-stakes litigation between Google and Oracle approaches its resolution at the Supreme Court. For seekers of alpha, this isn't just about what investments to make, but about the way one goes about making them, the very mechanics of trading.


Northern Trust on Hedge Funds, Big Data and Transparency

May 20th, 2015 | Filed under: Alpha Hunters, Best Practices, Institutional Investing, Technology, Today's Post

The integration of data isn't fully on the hedge fund industry radar yet. Yet it may be critical to rebuilding manager-investor relations via whiz-bang 21st century technology.


The Skorina Report: The Best, The Rest & Our Pick for Public Endowment CIO of Decade

Apr 30th, 2015 | Filed under: Alpha Hunters, Alpha Strategies, Featured Post, Guest Posts, Institutional Investing, The Skorina Report, Today's Post

Charles Skorina looks at the top public endowments and discusses performance with Erik Lundberg.


They Do It Right Down Under: Australian Institutional Funds

Apr 14th, 2015 | Filed under: Alpha Hunters, Alpha Seekers, Alpha Strategies, CAPM / Alpha Theory, ETFs, Indexes, Institutional Investing, Today's Post

The hapless U.S. mutual funds Chen and Gallagher sample have a nominally positive pre fee alpha only when measured against CAPM. That disappears into the negatives when the baseline used is the Fama-French model, and deeper into the negatives when the momentum factor is added.


Hedge Fund Investors and Managers: Concord and Discord

Mar 29th, 2015 | Filed under: Alpha Hunters, Alpha Strategies, Hedge Fund Strategies, Institutional Investing, Today's Post

Investors in hedge funds want more transparency than they think they're getting, a fact that might not be clear to their managers.


More Global Mandates, Fewer EM Mandates, and Other Changes

Mar 23rd, 2015 | Filed under: CTA, Institutional Investing, Performance, Analytics & Metrics, Risk management, Today's Post

Eurekahedge's latest report gives a number of timelines for grappling with changes in the hedge fund world: since 2007; since January 2013; YTD January 2015. In any frame, you don't have to be a meteorologist....


KPMG, MFA & AIMA: Institutional Investors & Customization

Mar 19th, 2015 | Filed under: Alternative Mutual Funds, Asset allocation, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Investment Management Fees, Liability Driven Investing, Regulatory, Today's Post

Surveys suggest that certain conspicuous ongoing trends will continue. For example, the classic 20 + 2 fee structure will continue to crumble, replaced by "customized" structures. A full 91% of the small hedge fund managers who filled out a survey agreed with this. A mere 76% of large hedge fund managers did likewise.


ESMA to Member States: You’re Not Doing Enough Re: MiFiD

Mar 18th, 2015 | Filed under: Institutional Investing, Regulatory, Retail Investing, Today's Post

A newly released report tells us that ESMA is unhappy with the national "competent authorities" as to how they've enforced MiFiD. the report implies that the adjective in the phrase "competent authorities" is to be understood as a courtesy rather than a description.


Does Private Real Estate Actually Have a Low Correlation with Public Real Estate?

Mar 15th, 2015 | Filed under: Alpha Hunters, Alpha Strategies, Asset pricing, Institutional Investing, Private Equity, Real Estate, Today's Post

Brad Case, Ph.D., CFA, CAIA, looks at the relationships between public and private real estate.


5 Insights on a Hedge Fund Outlook

Mar 12th, 2015 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Today's Post

Guest columnist Diane Harrison finds five trends in hedge funds that are worth watching.


The Skorina Report: Divestment vs. Fiduciary Duty Whose Money is it?

Mar 5th, 2015 | Filed under: Guest Posts, Institutional Investing, Risk management, The Skorina Report, Today's Post

Guest columnist Charles Skorina takes a look at investment divestment..


Capital Call – Mastering 7 Essential Investor Questions

Feb 22nd, 2015 | Filed under: Institutional Investing, Today's Post

...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.


A Basis for Pursuing the Pursuers? Sonar-based Whale Hunts

Feb 17th, 2015 | Filed under: Algorithmic and high-frequency trading, Alpha Hunters, Derivatives, Institutional Investing, Regulatory, Today's Post

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.


Pension Funds as Alternative Investors Get Some Advice

Jan 28th, 2015 | Filed under: Alpha Hunters, Alpha Strategies, Asset allocation, Institutional Investing, Today's Post

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.


Top 10 Hedge Fund Trends for 2015

Jan 8th, 2015 | Filed under: Alpha Hunters, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Today's Post

Guest columnist Don Steinbrugge, CFA, surveys institutional investors and hedge funds to find out what the top trends may be for 2015.


Longevity Risk: Wary of Your 2015, and of Somebody Else’s Life Span?

Dec 21st, 2014 | Filed under: Institutional Investing, Liability Driven Investing, Risk management, Socially responsible investing, Today's Post

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.


Qatar and the QIA: When the SWF Is Also a Family Office

Dec 10th, 2014 | Filed under: Commodities, Institutional Investing, Technology, Today's Post

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.


Footnote 13: Barclays Did ‘Change the Number’

Oct 7th, 2014 | Filed under: Algorithmic and high-frequency trading, Institutional Investing, Regulatory, Today's Post

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....


Signs of a Renaissance in Emerging Manager ‘Alpha’

Oct 2nd, 2014 | Filed under: Alpha Seekers, Alpha Strategies, Hedge Fund Strategies, Institutional Investing, Performance, Analytics & Metrics, Today's Post

Guest columnist Peter Urbani looks at emerging managers and why they may be re-emerging and bringing alpha with them.


What hath CalPERS Wrought? And Why?

Sep 30th, 2014 | Filed under: Institutional Investing, Investment Management Fees, Today's Post

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?


Looking at the Next Generation of Institutional Investing

Sep 25th, 2014 | Filed under: Asset allocation, Hedge Fund Industry Trends, Institutional Investing, Today's Post

Guest columnist Andrew Beer looks at the changes in institutional investing.


Top 5 Ramifications of CalPERS’ Hedge Fund Exodus

Sep 24th, 2014 | Filed under: Alpha Hunters, Hedge Fund Industry Trends, Institutional Investing, Today's Post

Guest columnist Don Steinbrugge, CFA, looks at some of the potential reactions to CalPERS' leaving hedge funds.


The Skorina Report: Another try at herding Gotham’s five-headed fund

Sep 21st, 2014 | Filed under: Featured Post, Guest Posts, Institutional Investing, The Skorina Report, Today's Post

Guest columnist Charles Skorina looks at the five-headed NYC pension system with its new leader, Scott Evans.


Investing in the Investor

Sep 4th, 2014 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Institutional Investing, Retail Investing, Today's Post

Guest columnist Diane Harrison looks at what advisors think of hedge funds.


The Delusions a Boom Can Bring and the Perils of Chasing Hedge Fund Winners

Aug 28th, 2014 | Filed under: Alpha Hunters, Alpha Strategies, Institutional Investing, Portable Alpha & Alpha/Beta Separation, Risk management, Today's Post

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.


The Investment World Has Good News for Philanthropy

Aug 3rd, 2014 | Filed under: Alpha Hunters, Alpha Strategies, Endowments & Foundations, Institutional Investing, Today's Post

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!


Deutsche Bank on Investor Demands Today

Jul 27th, 2014 | Filed under: Alpha Strategies, Institutional Investing, Retail Investing, Today's Post

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.


Looking at the Future of World Wealth McKinsey-style

Jul 21st, 2014 | Filed under: Emerging markets, Institutional Investing, Today's Post

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.


Does the Defined-Contribution Broom Still Sweep All Before It?

Jul 14th, 2014 | Filed under: Institutional Investing, Today's Post

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.


The Philosophy of Liquidity: Diversity, Decision-making and Governance

Jul 6th, 2014 | Filed under: Institutional Investing, Today's Post

Guest columnist Donna Howe examines diversity at the board level. Does it make a governance difference?


Industry Discovery: Maturity is a Pain

Jun 26th, 2014 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Seeding/early-stage, Today's Post

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.


Why are Hedge Fund Assets Reaching All-time Highs?

May 12th, 2014 | Filed under: Alpha Hunters, Asset allocation, Institutional Investing, Media Coverage of Hedge Funds, Performance, Analytics & Metrics, Today's Post

Guest columnist Don Steinbrugge looks at why allocators continue to invest in hedge funds, even when the media thinks they shouldn't.


Why Do Investors Love Large Hedge Funds?

May 8th, 2014 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Performance, Analytics & Metrics, Today's Post

Jeff Malec, CAIA, looks at why large hedge funds have all the fun and get all the money.