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.
All that dry powder on the sidelines means good news and bad for PE GPs: first, that there is room for a lot of new demand for their services (the good news); second, that investors remain hesitant – they have deliberately kept that powder in the horn and many will likely continue to do so (the bad news).
Guest columnist Charles Skorina looks at sustainable investing and asks the question: Is it sustainable?
Commonfund doesn't seem to have its heart in the project of defending hedge funds specifically as winners of alpha. Rather, its new white paper offers other, non-alpha, defense of the hedge fund as an institution.
An opinion by Chief Judge Lynch, of the 1st Circuit Court of Appeals, should have private equity managers in that Circuit reviewing their portfolios, and thinking in a more expansive way about their potential ERISA liabilities for companies they control.
Guest columnist Charles Skorina looks at pension funds and fees and finds....
Pension fund managers and insurers have long been less than thrilled by the idea of risking their assets in long-term, illiquid, infrastructure projects. EDHEC-Risk makes the case that their wariness, though not irrational, may be excessive.
A new white paper from the Commonfund Institute tells us that the growth of the Outsourced CIO model, especially for non-profits, is a consequence of the increasing complexity of the investment environment.
In east Asia, savings rates have long been high and constant, and cannot plausibly be expected to get much higher. Indeed, they may in certain respects be too high. Thus, progress in addressing the pension/demographic crunch has to come on the asset management side.
Charles Skorina looks at compensation at the big endowments.
Eighty-nine percent of the respondents in a newly released Natixis survey of institutions said they expect they will be able to meet their future obligations. But they aren't as optimistic about the fate of individuals in their own countries who are now trying to save for retirement.
Part II of a new SEI report on hedge funds and adapting to survival.
The respondents in the Commonfund survey have changed their view of the most pressing tail risks from last year to this. A year ago, 32 percent of the respondents saw an EU crisis as the most significant risk going forward. No longer.
The obvious reason for the allocation preferences of healthcare endowments is that they believe they need to remain very liquid. Jarvis, in this white paper, points out that the liquidity preference comes at a cost in performance.
Guest columnist Don Steinbrugge looks at hedge fund fees.