CC-BY-SA-2.0, FlickrFoto: AedoPulltrone, Flickr, Creative Commons. Schroders lanza un nuevo fondo en su plataforma GAIA de la mano de Two Sigma Advisers
Schroders is pleased to announce the launch of an externally-managed fund, Schroder GAIA Two Sigma Diversified, on its UCITS platform. The fund will be sub-advised by Two Sigma Advisers, LP, and launches on 24 August 2016.
The strategy, created by Two Sigma Advisers, LP, in collaboration with Schroders, will combine US equity market-neutral and global macro strategies. The fund aims to offer investors portfolio diversification through a liquid alternative strategy that intends to be uncorrelated to traditional equity and bond markets. The strategy will apply a scientific and algorithmic approach to investing across thousands of individual equities and hundreds of macro markets, allocating the majority of the fund to the equity market-neutral strategy.
Two Sigma Advisers, LP was launched in 2009 and together with its affiliates (“Two Sigma”) has built an innovative platform that combines extraordinary computing power, vast amounts of information, and advanced data science to produce breakthroughs in investment management and related fields. Two Sigma employs more than 1000 people, including more than 150 PhDs.
Geoff Duncombe, Chief Investment Officer of Two Sigma Advisers, LP said: “Two Sigma’s platform approach leverages data and technology expertise to create solutions that meet the needs of diverse investor groups. We are thrilled to partner with Schroders, which has built a preeminent UCITS platform, to bring investors portfolio diversifiers that seek to deliver controlled volatility, low correlation to markets, and attractive risk-adjusted returns.”
Eric Bertrand, Head of Schroders GAIA, said: “We continue to see very strong demand for liquid alternative investment strategies, as clients seek to diversify their portfolios. We’re delighted to partner with Two Sigma to launch this newly created strategy specifically tailored to meet these needs, with the aim of delivering alpha. Two Sigma has a strong reputation in the field due to its leading technology expertise and creative, research-driven approach, which allows the firm to design and evolve intelligent systematic strategies.”
GAIA Platforms
Schroder GAIA and Schroder GAIA II combine the strength of Schroders’ renowned asset management expertise and extensive distribution capability with leading hedge fund managers.
Schroder GAIA Two Sigma Diversified will launch on the Schroder GAIA UCITS platform. Schroders now has nine funds on the two GAIA platforms, eight managed by external hedge fund managers (Schroders GAIA Two Sigma Diversified, Schroder GAIA Egerton Equity, Schroder GAIA Sirios US Equity, Schroder GAIA Paulson Merger Arbitrage, Schroder GAIA BSP Credit, Schroder GAIA BlueTrend, Schroder GAIA Indus PacifiChoice and Schroder GAIA II NGA Turnaround) and one managed internally (Schroder GAIA Cat Bond).
CC-BY-SA-2.0, FlickrPhoto: Ken Teegardin. A Secure Retirement is Not Only a Fundamental Need for Mexicans, but Also Their Own Responsibility
Mexicans today seem to be aware of the challenge they face for their future: 89% of them agrees that their own retirement funding is increasingly their own responsibility, according to the conclusions of Natixis Global Asset Management’s Global Retirement Index 2016, with Mexico ranking 35th in a list of 43 countries.
As the responsibility to finance retirement transfers from governments and employers to people, the need to increase contributions to savings becomes imperative. We believe voluntary contribution via the Afore account can be one of the best alternatives. By defining a savings plan for retirement, financial advisors may provide an added value to workers, with clear ideas and information on how to be better prepared for retirement.
“The pension system coverage in Mexico is still a challenge, and achieving security in retirement may still be difficult, although a possible goal if all the stakeholders — policymakers, employers and workers – contribute”, said Mauricio Giordano, Country Manager, Natixis Global Asset Management México, at the 1st National Afore Convention. According to Giordano, the following 5 principles are a good starting point for a successful retirement plan:
Define the spending needs in retirement: both advisors and workers should honestly assess their spending needs at the time of retiring, keeping in mind priorities such as mortgage or rent, healthcare, family, insurance and taxes. The lifestyle preferences such as travels, clubs and hobbies should also be considered.
Match your retirement funds with your expenses: The key challenges to plan for retirement is how to finance expenses short and long term. Dividing financial commitments in mandatory and optional may help simplify the process to prioritize the spending patterns. The main goal for financial advisors and clients is to continuously and sustainably match funds with spending needs. Resources may include income from investment, social security, pensions and other sources.
Plan for new risks in retirement: The fear to lose money is one of the biggest challenges for workers who save for their pension. This may make investment decisions difficult. Besides considering the traditional risks, retirement plans must consider additional risks such as longevity and inflation.
Minimize fiscal impact: in case an investment portfolio is a main source of cash flow, it is essential to have an effective fiscal strategy. Financial advisors and their clients may resort to a tax professional to ensure an optimum fiscal efficiency.
Commitment and Flexibility: Both for advisors and clients, establishing a plan to fund retirement and financial goals in retirement is a continuous process. It requires flexibility to adapt to changes in the interests and unexpected events such as healthcare issues or long term security. The most effective plans to finance retirement have the capacity to adjust to lifestyle changes.
“Our research shows clear findings: in those countries providing more security to their retirees, the government, employers and specialized investment firms offer incentives and innovative solutions so that workers have the tools they need to save for retirement,” concluded Giordano.
You can read the full report in the following link.
Old Mutual Global Investors (OMGI), part of Old Mutual Wealth, has announced that Diego Parrilla joined the business on 8 August, in the newly created role of managing director, commodities.
Based in Singapore, Diego will report into Paul Simpson, investment director at OMGI. He will initially be responsible for promoting and building the GBP 60 million Old Mutual Gold & Silver Fund to the institutional investors in Singapore and other markets in which OMGI operates. He will also be working with OMGI’s management team to identify absolute return strategies across precious metals and commodities that are aligned with the strategic direction of the company, and with client demand and market suitability.
Diego joins the business from Dymon Asia Capital, where he worked from August 2015 having previously held a number of high profile investment and distribution positions during his career, including portfolio manager at BlueCrest Capital Management, from June 2014 to July 2015; managing director and head of commodities, Asia Pacific at Merrill Lynch from 2009 -2011, and managing director and global head of commodity sales at Merrill Lynch from 2005-2009. Prior to this, Diego was an executive director in the commodities division at Goldman Sachs from 2001-2005, and started his career as a precious metals trader at JP Morgan in London in 1998.
He is also a best-selling author having co-written, “The Energy World Is Flat: Opportunities From The End of Peak Oil” in 2015 and “La Madre De Todas Las Batallas in 2014”. He is also a regular contributor to El Mundo and the Financial Times.
“Diego is a highly accomplished and respected investor and commodities economist, and we’re thrilled to welcome him to the team. At OMGI we recognise that precious metals have become an increasingly important asset class as investors look to hedge against the impact of modern monetary policy. We will call upon Diego’s significant experience and knowledge of commodity markets to assess client demand for alternative commodities products in the future,” commented Richard Buxton, CEO, OMGI.
“We are seeing a perfect storm in the gold markets whereby central banks and global markets are testing the limits of monetary policy, credit markets, and fiat currencies, which in my view support a multi-year bull market for precious metals. The Old Mutual Gold & Silver Fund offers a differentiated proposition. I look forward to working with the entire OMGI team to continue to deliver best in class solutions across precious metals and commodities, key components of global macro markets, for our clients.”, added Diego Parrilla.
The Old Mutual Gold & Silver Fund launched in March 2016 and is managed by Ned Naylor-Leyland. It aims to deliver a total return and utilizes a distinctive investment approach, combining indirect exposure to gold and silver bullion with selected precious metals mining equities.
According to the latest BofA Merrill Lynch Fund Manager Survey cash levels dropped sharply, from a 15-year high of 5.8%, to 5.4% in August. At the same time, global growth expectations rebounded, with a net 23% of investors expecting the global economy to improve in the next 12 months.
“Investors are less bearish, but sentiment has yet to shift from ‘fear’ to ‘greed’. As such, we expect stock prices to rise further until bonds throw another tantrum,” said Michael Hartnett, chief investment strategist.
Other findings include:
Central banks’ creation of a low and stable rates environment is a big factor driving fresh optimism and a preference among fund managers for deflation assets over inflation assets; only 13% of respondents expect the BoJ or ECB negative interest rate policy to end within the next 12 months
A record net 48% of investors think global fiscal policy is currently too restrictive
Geopolitics is seen as the largest risk to financial market stability, followed by protectionism – which is cited at the highest level since December 2010
EU disintegration, followed by renewed China devaluation and US inflation are seen by investors as the biggest tail risks
Allocation to US equities is highest since January 2015 at a net 11% overweight
Allocation to Eurozone equities remains low at a net 1% overweight while allocation to UK equities improves to net 21% underweight from net 27% underweight last month
Allocation to EM equities improves to net 13% overweight, its highest level since September 2014
While allocation to Japanese equities improves to a net 1% underweight from a net 7% underweight last month, allocation preference for the next 12 months worsens to -8% from -3% with only the UK behind Japan
Manish Kabra, European equity quantitative strategist, added that “Eurozone equity allocations are broadly unchanged amid concerns of EU disintegration and UK stocks are still the least-preferred. Within Europe, we prefer UK large-caps from both a positioning and macro perspective, as they benefit from weaker GDP, lower yields and less European exposure.”
CC-BY-SA-2.0, FlickrPhoto: Jose Gutierrez. AUM in the Global Investment Funds Market Grew US$1.1 Trillion in July
According to the Global Fund Market Statistics Report, written by Otto Christian Kober, Global Head of Methodology at Thomson Reuters Lipper, assets under management in the global collective investment funds market grew US$1.1 trillion (+3.0%) for July and stood at US$37.1 trillion at the end of the month.
Estimated net inflows accounted for US$107.7 billion, while US$967.3 billion was added because of the positively performing markets. On a year-to-date basis assets increased US$2.1 trillion (+6.1%). Included in the overall year-to-date asset change figure were US$123.9 billion of estimated net inflows. Compared to a year ago, assets increased US$1.1 trillion (+2.9%). Included in the overall one-year asset change figure were US$478.9 billion of estimated net inflows. The average overall return in U.S.-dollar terms was a positive 3.0% at the end of the reporting month, outperforming the 12-month moving average return by 3.0 percentage points and outperforming the 36-month moving average return by 2.9 percentage points.
Most of the net new money for July was attracted by bond funds, accounting for US$77.6 billion, followed by money market funds and commodity funds, with US$47.7 billion and US$3.3 billion of net inflows, respectively. Equity funds, with a negative US$19.4 billion, were at the bottom of the table for July, bettered by “other” funds and real estate funds, with US$4.5 billion of net outflows and US$0.3 billion of net inflows, respectively. The best performing funds for the month were equity funds at 4.6%, followed by “other” funds and mixed-asset funds, with 4.3% and 2.5% returns on average. Commodity funds at negative 1.3% bottom-performed, bettered by real estate funds and money market funds, with a positive 0.2% and a positive 0.3%, respectively.
In a year-to-date perspective most of the net new money was attracted by bond funds, accounting for US$279.3 billion, followed by commodity funds and alternatives funds, with US$26.0 billion and US$9.1 billion of net inflows, respectively. Equity funds were at the bottom of the table with a negative US$110.9 billion, bettered by mixed-asset funds and money market funds, with US$51.4 billion and US$38.2 billion of net outflows. The best performing funds year-to-date were commodity funds at 12.1%, followed by mixed-asset funds and bond funds, both with 7.2% returns on average. Alternatives funds, with a positive 1.3% was the bottom-performing, bettered by money market funds and “other” funds, with a positive 1.9% and a positive 5.1%, respectively.
CC-BY-SA-2.0, FlickrDavid Knutson, Eric Skelton and Chris Eger . Schroders US Strengthens Credit Team with Three Key Hires
Schroders has announced three senior appointments in the US to underpin the strong growth of its US fixed income business.
David Knutson has joined the US Credit team as Head of Credit Research – Americas. He will be based in New York and report into Wes Sparks, Head of US Credit. David will be covering large US banks. David brings almost 25 years of research experience to Schroders; he joins from Legal and General Investment Management America, where he had been a Senior Analyst in Fixed Income Research for ten years. Prior to this, David spent three years as Director of Fixed Income Research at Mason Street Advisors and seven years working in Credit Research and Debt Capital Markets at UBS. David replaces Jack Davis who transitions internally into a Senior Analyst role.
Eric Skelton joined the Global Fixed Income and FX trading team as US Credit trader for US investment grade credit, based in New York. He will report into Gregg Moore, Head of Trading, Americas and will work closely with US Credit Portfolio Managers, Rick Rezek and Ryan Mostafa and the rest of the US Fixed Income trading desk. Eric Skelton joins Schroders from Achievement Asset Management (formerly Peak6 Advisors), where he was a Credit Trader. Prior to joining Achievement Asset Management in 2014, Eric spent three years at Nuveen Investments.
Chris Eger joins the US Credit team in a newly created role as Portfolio Manager, reporting to Wes Sparks. Chris is based in the New York office. He joins Schroders with 14 years of experience in Investment Grade – in both Trading and Portfolio Management capacities. He joins from J.P. Morgan Chase, where he held the role of Executive Director – Credit Trader, Investment Grade Domestic and Yankee Banks. Prior to joining J.P. Morgan in 2007, Chris spent five years at AIG Global Investment Group where he held two Vice President positions, firstly as a Credit Trader and then as a Total Return Portfolio Manager.
Karl Dasher, CEO North America & Co-Head of Fixed Income at Schroders, said: “Investors globally are increasingly attracted to US credit markets in the search for yield and we have been beneficiaries of that trend. To support continued client demand and process evolution, we have made three strategic hires. These additions will further strengthen our in-house research and execution capabilities in the USD credit domain.”
CC-BY-SA-2.0, Flickr. US Engine of Dividend Growth Slows Markedly, While Europe Picks up the Pace
Global dividend growth slowed in the second quarter, according to the latest Henderson Global Dividend Index. Underlying dividend growth, which strips out exchange rate movements and other lesser factors, was 1.2%. This is slower than the 3.1% underlying growth seen in the first quarter, partly reflecting Q2 seasonal patterns that give greater weight to slower growing parts of the world, and partly owing to a more muted performance from the US.
US payouts rose 3.1% on a headline basis to $101.7bn, equivalent to an underlying increase of 4.6%. This was the slowest rate of growth since 2013, reflecting subdued profit growth in the US, partly due to the impact of a strong dollar. The slowdown in the US began late last year but should be considered a normalisation to more sustainable levels of dividend growth after several quarters of double digit increases.
Income investors turn their attention to Europe in the second quarter. Two-thirds of the region’s dividends are paid in Q2, making it comfortably the largest contributor to the global total. European dividends (excluding the UK) rose 1.1% year on year in headline terms*, but on an underlying basis were an encouraging 4.1% higher. European dividends of $140.2bn made up two-fifths of the global second-quarter total. They were 1.1% higher than Q2 2015 on a headline basis. Underlying growth was an impressive 4.1%, once lower special dividends, particularly in France and Denmark, as well as other lesser factors were taken into account.
The Netherlands and France enjoyed the second and third fastest growth rate in the world, while German growth was hit by big cuts from Volkswagen and Deutsche Bank; Austria, Spain and Belgium also lagged behind.
In Japan, headline growth was 28.8%, with payouts totalling $30.8bn. Two thirds of this increase was down to the currency, with positive index changes accounting for the rest. In underlying terms, therefore, dividends were 0.8% lower, as company earnings were depressed by the strong yen, and as economic confidence in Japan weakened.
It was a challenging quarter for emerging markets. Dividends fell over a quarter on a headline basis to $22.9bn, as weaker currencies and index changes took their toll. Adjusting for these factors, payouts fell 18.8% in underlying terms, with a large number of countries, including the big four BRICs, seeing underlying declines.
The second half of the year is likely to be weaker than the first, partly because seasonal patterns means the emphasis shifts slightly towards those parts of the world where dividends are growing more slowly, like emerging markets, Australia, and the UK. Owing to the changes in the latest quarter, the Henderson’s team has reduced their forecast for the full year to $1.16 trillion, down from $1.18 trillion. This is equivalent to a headline expansion of 1.1%, or 1.4% on an underlying basis.
“We can see how more muted profit expansion, partly owing to stronger currencies, has slowed dividend growth in Japan and the US. In emerging markets, payout cuts have been greater than we expected so far this year as well. Europe remains broadly positive, in line with our expectations. The weak spots we have seen have been company-driven, or owing to specific sector trends like the impact of lower commodity prices, rather than related to wider economic difficulties. The slowdown in the US began late last year but should be considered a normalisation to more sustainable levels of dividend growth after several quarters of double digit increases.” Said Alex Crooke, Head of Global Equity Income.
Since the UK’s decision to leave the EU at the end of June, the pound has fallen further on the foreign exchange markets, extending a descent that began in the months running up to the referendum. However, a number of large international UK companies pay their dividends in dollars, so, according to Crooke, the impact will be less severe than the pound’s devaluation might suggest. In addition, the UK only accounts for around only 10% of global dividends so the effect on the global total is likely to be relatively small.
CC-BY-SA-2.0, FlickrCamilo Lopez da entrada a Jorge Escobar como socio igualitario en la firma de real estate TSG - foto cedida. Camilo Lopez da entrada a Jorge Escobar como socio igualitario en la firma de real estate TSG
TSG -a leading, diversified real estate investment, development and sales company in South Florida formerly known as The Solution Group – has announced that Jorge Escobarhas joined as an equal partner alongside founding partner and CEO Camilo Lopez. Following more than 20 years in the international banking industry, most recently as Global Market Head of Chile for HSBC Private Bank, Escobar will serve as a managing partner in his new position.
TSG, which has successfully grown a portfolio of more than $400 million in assets since its inception in 2008, will utilize Escobar’s diverse financial expertise to enhance the firm’s boutique platform on a global level for investment in South Florida real estate. Capitalizing on Escobar’s institutional-minded discipline, the company’s new structure will focus on expanding its international network, while allowing for a more sophisticated and seamless approach to local market investment opportunities in a highly-personalized process.
“I am thrilled to welcome Jorge to the TSG family,” said Lopez. “Having developed strong relationships in Latin America, the U.S. and Europe for decades, Jorge possesses an ideal combination of global investment experience and an entrepreneurial drive that add tremendous value to our organization. Complimenting my expertise identifying real estate opportunities and in design ideation, our partnership will now deliver a robust strategy to expand TSG’s company value.”
Prior to joining TSG, Escobar was responsible for overseeing more than $1.5 billion in funds for high-net-worth clients throughout the world. During his nine-year tenure with HSBC, he led some of the largest investment transactions in offshore private bank business in Latin America and generated significant new business from the region’s most noteworthy families.
Prior to HSBC, Escobar was head of the private bank business for ABN AMRO Bank in Chile for four years. He began his career at Citi Group as an investment advisor, and later served as vice president of BankBoston Private Bank for more than three years.
“It is with great pride that I join this trusted organization built on the foundation of astute leadership and solid fundamentals,” adds Escobar. “This is a natural move for me to enter the real estate environment given South Florida’s prime position to set global benchmarks and TSG’s unique and innovative platform, which now places the company at the forefront through our partnership.”
The latest European ETF Market Review from Thomson Reuters Lipper shows that assets under management in the European exchange-traded fund (ETF) industry increased from 452.8 billion euros in June to a new all-time high of 473.6 billion euros at the end of July. Further insight and analysis for both assets under management and fund flows by asset type, classification, promoter and fund can be found here.
According to Detlef Glow, Head of EMEA research at Thomson Reuters Lipper, the increase of 20.8 billion euros for July was mainly driven by the performance of the underlying markets (+€12.8 bn), while net sales contributed €8.0 billion to the overall growth in assets under management in the ETF segment.
Bond ETFs (+€5.0 billion) enjoyed the highest net inflows for July. Equity US (+€1.5 bn), followed by Equity Emerging Markets Global (+€1.3 bn) and Equity Global (+€1.0 bn) were the best selling Lipper global classifications for July.
The best selling ETF promoters in Europe for July were iShares (+€7.2 bn), State Street SPDR (+€1.0 bn) and Vanguard (+€0.5 bn). The ten best selling funds gathered total net inflows of €4.6 bn for July. iShares Diversified Commodity Swap (+ €0.7 bn), was the best selling individual ETF for July.
CC-BY-SA-2.0, FlickrPhoto: d26b73. 80% of Institutional Investors to Increase or Maintain Exposure to Real Estate Over the Next Two Years
Approximately four in five (80%) institutional investors plan to increase or maintain their exposure to real estate over the next two years, according to a new study by Aquila Capital. With 38% of respondents feeling ‘positive’ or ‘very positive’ about the outlook for the asset class, the research suggests that institutional investor demand for European real estate shows few signs of abating.
Overall, 87% of institutional investors currently invest in real estate, with their average exposure equating to 11% of their portfolio. 58% of investors have exposure to a core real estate investment strategy with a third (33%) holding core-plus assets. 27% and 16% of respondents are invested in value-added and opportunistic strategies respectively.
Despite their enthusiasm, investors have a number of concerns about the outlook for European real estate: nearly half (47%) are worried by the impact of continued economic uncertainty while 43% think assets are at, or are close to, being fully priced. Around a third (31%) flagged falling yields in prime markets while 22% cited uncertain geopolitics and the threat of terrorism as being problematic.
The real estate investment vehicles most favoured by institutional investors include: collective funds (39%), specialist investment funds (35%) direct ownership (23%) and fund-of-funds (23%).
Rolf Zarnekow, Head of Real Estate at Aquila Capital, said: “Institutional investor demand for European real estate remains extremely strong and we are likely to see increasing amounts of new capital allocated to this asset class given the risk-adjusted returns it can offer.
“In our view, the Spanish residential sector currently offers a significant investment opportunity. We began investing in the Spanish property market two years ago and continue to see a significant increase in demand from international investors seeking to gain exposure to prime residential assets in key cities such as Madrid and Barcelona.”
The findings follow Aquila Capital’s recent launch of a new real estate strategy for institutional investors that invests in the reinvigoration of the Spanish residential property market. The strategy focuses on the construction of residential housing complexes and the conversion of existing properties to residential real estate in the metropolitan regions of Spain. Aquila Capital has already made a number of acquisitions and has a significant pipeline of further opportunities in this sector. The strategy targets a total return of 155% to 175% after local taxes and costs by the end of its investment term in 2019.
According to the research, almost 82% of investors are positive or neutral about the prospects for the Spanish real estate market and one in three respondents (31%) expects to see increasing numbers of institutional investors capitalising on the opportunities offered by the sector over the next two years.
Roman Rosslenbroich, CEO and Co-Founder of Aquila Capital, added: “We are delighted by the interest that our investment strategy has generated among investors and look forward to deploying newly raised-capital across a range of residential schemes that offer tremendous potential for capital appreciation.”
