The $32 billion Maryland State Retirement System is searching for advisers in real estate and private equity, as it moves toward its strategic asset allocation target that sits signficantly distant from its actual investments at the end of September, requiring a quadrupling of its private equity investments and new allocations to real return assets.
Just because the BlackRock/Barclays Global Investors merger will create a global funds management behemoth – with $3 trillion under management and 9,000 employees in 24 countries – does not mean alpha will come more cheaply. Amanda White spoke to vice chair of BlackRock, Robert Fairbairn, about what the merger means for products, clients and the industry at large, as part of an investigation into the role of the mega manager.
In this research report Watson Wyatt asserts the long-term outlook for emerging economies will impact positively on emerging market investments, but it warns that choice of asset class and implementation route are not obvious. The report suggests exposure to the macroeconomic dynamics of emerging markets will be most readily obtained in emerging market equities, debt and currencies, and discusses how emerging market economies will continue to grow strongly, due to a mix of rising productivity, economic and financial reforms, and favourable demographics. However, it states that institutional investors face significant complexity and potentially high fees when trying to build a portfolio that captures this long-term trend and should also recognise the governance implication of following such a strategy.
It’s time for pension funds to show some leadership on funds management fees, to demonstrate that they are at the top of the food chain – they have the check book. Roger Urwin, global head of investment content for Watson Wyatt Worldwide, believes pension funds have, to a large extent, been captive to the fee structures of their agents. He spoke with GREG BRIGHT.
In this paper Joop Huij from the Rotterdam School of Management, Erasmus University and Jeroen Derwall from Tilburg University, School of Economics show the observed relation between portfolio concentration and performance is mostly driven by the breadth of the underlying fund strategies, not just by fund managers’ willingness to take big bets.
In the final days of the hedge fund boom, the A$30 billion ($27.8 billion) AustralianSuper stepped up its investigation of the market returns embedded within the alternative strategies. Now, two years and a devastating financial crisis later, the big defined contribution fund has cut back its hedge fund program and begun analysing the true power of beta in its portfolio. SIMON MUMME reports.