AXA Investment Managers (AXA IM) appointed Michael Ganske as Head of Emerging Markets Fixed Income. He joins AXA IM in May 2016 from Rogge Global Partners where he was a Partner and Head of Emerging Markets (EM). Michael will report to Chris Iggo, CIO Fixed Income.
Michael has more than 15 years of experience in EM Fixed Income. Prior to his role at Rogge Global Partners, Michael was a Managing Director and Divisional Head of EM Research at Commerzbank (2007-2013) and a Director and Head of EM at Deka Investment GmbH (2004-2007), and Vice President and EM Fixed Income Portfolio Manager at DWS Investments, Deutsche Bank Group (2000-2004).
John Porter, Global Head of Fixed Income at AXA IM, commented: “We are pleased to welcome Michael on board and confident that his in-depth experience will further enhance our global emerging markets fixed income team and capabilities. We have invested heavily in this team with the hire of Sailesh Lad, Senior Portfolio Manager, and Olga Fedotova, Head of EM Credit Research, last Summer. Michael is a key appointment for our team and demonstrates the scale of our ambition in this space as well as our belief that investors will continue to find emerging market debt as an attractive asset class.”
Michael will lead a global team of 12 investment professionals based in London, Paris, Hong Kong and Mexico, managing approximately €5 billion of EM and Asian debt, across three flagship mutual funds and several segregated institutional mandates. The EM Fixed Income team is fully embedded in the AXA IM Fixed Income investment process. Michael’s appointment follows the decision in June to create a global emerging markets (GEM) fixed income team in support of the continued attractiveness of the EM asset class. Michael will be based in AXA IM’s London office.Michael is a German native, holds a Bachelor’s and Master’s degree in Economics from the University of Augsburg, and a Doctorate in Economics from the University of Hohenheim. Michael is also a certified Financial Risk Manager and Chartered Financial Analyst (CFA).
Foto: Scott
. Goldman Sachs simplifica la estructura de comisiones de sus ActiveBeta ETFs
Goldman Sachs Asset Management recently announced that it will implement changes to its fee and fee waiver arrangements for its ActiveBeta Exchange-Traded Funds. Effective May 1, 2016, a unitary management fee structure, together with a reduction in the management fee rate, will be implemented for the US Large Cap, European, international and Japan equities ActiveBeta ETFs.
Under the unitary fee structure, GSAM will be responsible for paying substantially all the expenses of each Fund. The total annual Fund operating expenses will be of 0.09% for the U.S. Large Cap Equity and of 0.025% for the Europe, International and Japan Equity ETFs.
Additionally, the current expense limitation arrangement for the Goldman Sachs ActiveBeta Emerging Markets Equity ETF will be made permanent. Under this arrangement, the Fund’s expenses are capped, subject to certain exclusions, at 0.45%.
Photo: Michael Maeder. Columbia Threadneedle Investments Appoints Sales Director In Zurich
Columbia Threadneedle Investments, announces the appointment of Michael Maeder as Sales Director Financial Institutions with immediate effect. Michael is based in Zürich with direct report to Christian Trixl, who heads up Columbia Threadneedle Investments in Switzerland.
In his role, Michael Maeder is responsible for broadening and deepening relations with financial institutions with a focus on private banks, cantonal banks, independent asset managers and family offices in the German speaking regions of Switzerland and in Liechtenstein.
Michael joins from NN Investment Partners where he had been business development manager since 2009, covering a similar clientele in the same region. He started his career at UBS Investment Bank in 2006 in Zürich. He holds an MBA from International University of Monaco.
Christian Trixl, Head of Swiss Distribution at Columbia Threadneedle Investments, commented: “I am delighted to welcome Michael to our team. Michael’s experience in the Swiss market will help to expand our presence and client relations with financial institutions in Switzerland and Liechtenstein as we strive to offer them the successful investment solutions and products that they demand”.
CC-BY-SA-2.0, FlickrBrice Perin, fund manager at Generali Investments, in charge of GIS Absolute Return Convertible Bond Fund. Courtesy photo.. “A Flexible Absolute Return Approach Enhances the Convertible Bonds’ Convex Profile”
Brice Perin, fund manager at Generali Investments, in charge of GIS Absolute Return Convertible Bond Fund, explains in this interview with Funds Society why it is worthy to use an absolute return strategy in convertible bonds.
What do convertible bonds bring in an environment like the current one?
At Generali Investments we believe that convertible bonds feature an attractive asymmetry between credit and equities, especially in a volatile, uncertain market.
The securities’ hybrid profile automatically adapts to market movements in order to capture on average 2/3 of the market’s upside and limit to 1/3 of the drawdown. In fact, in falling stock markets, the securities automatically lower their equity sensitivity, therefore getting closer to the bond floor.
In addition, we are convinced that introducing a flexible absolute return approach enhances this embedded convex profile, therefore further limiting drawdowns and aiming to capture the market’s upside.
One of the key needs today is true diversification and decorrelation with other asset classes: can your fund accomplish this challenge?
Yes. In fact, convertible bonds combine various alpha drivers such as equities, bonds, credit, implied volatility, ratchet/prospectus clause, and benefit from different market cycles. These components do not always move together at the same time: depending on the market cycle, some would generate alpha while others could underperform and undermine performance. To optimize the different parameters, we have the ability to hedge partially or totally the unwanted parameters, in order to focus on the ones we would like to isolate and benefit from.
How is the absolute return strategy obtained with convertibles?
An absolute return investment approach applied to convertible bonds fund allows us to add arbitrage techniques in a transparent, rigorous and risk-managed UCITS structure. The GIS Absolute Return Convertible Bond fund aims at generating alpha through from both outright «credit» and «equity» exposure offered by our convertible bonds’ long positions and via hedging strategies (which isolate specific alpha creating components) – whether it is a macro hedge, overlay or a micro hedge at the security level. Moreover, those techniques aim to improve the convexity of convertible portfolios and the downside protection offered. Put simply, the concept is based on isolating and exploiting a desired parameter, for example isolating an attractive prospectus (“ratchet”) clause – while limiting or removing the unwanted underlying equity exposure.
What are your objectives in terms of returns and volatility?
Our strategy has an absolute return objective of achieving consistent performance across the market cycle, with a target volatility of 6-7%.
What strategies are applied in convertible bonds in general and specifically in your fund ? Arbitrage strategies, volatility … How do they work ?
Besides the standard outright exposure that convertible bond funds offer (mainly directional exposure on underlying equity and credit), implementing an absolute return philosophy within this asset class allows us to introduce some additional arbitrage and hedge strategies.
The latter consist of hedging partially or totally some of the risks, in order to focus only on some of the convertible bond parameters. As an example, we can hedge the underlying equity risk in order to isolate and implement volatility or prospectus strategies.
When implementing a volatility strategy we aim to benefit from the favorable changes in the implied volatility of a convertible bond, or from the favorable change of the spread between CB implied volatility and realized of the underlying equity. By re-adjusting our underlying equity hedges, we “capture” underlying equities’ volatilities.
Whilst, when investing and isolating the prospectus clause, we aim to benefit from, for example, some issuance premium compensation provided in the case of a takeover (that could be undermined by equity performance if un-hedged). Lastly, we can also decide to adjust the fund’s global sensitivities to equity or credit markets via overlay index positions to limit market drawdowns.
Is it easier to achieve absolute returns with convertibles than with other asset classes? Or more difficult? Why?
The current tumultuous market conditions and uncertainties make it challenging to achieve absolute returns across all asset classes. The heightened volatility and the frequent periods of strong underperformance in global markets (November 2015 to February 2016) enhance the importance of adopting a flexible and benchmark agnostic investment approach.
As mentioned before, convertible bonds carry a hybrid and asymmetric profile which adapts naturally to market movements. In fact the equity exposure (sensitivity or delta) moves in line with the equity markets therefore moving converts closer to their bond floor in periods of sell-off or to more equity-like profiles during market upsides and rebounds. From this perspective we consider convertible bonds have self-adjusting features.
In addition, convertible bonds associate other components such as volatility and prospectus (ratchet) clauses. Being able to isolate these, in order to hedge or invest in each component, allows us to identify the sources of alpha and eliminate partially or completely the underperforming components.
For all of the above arguments we believe that the asset class gives more leeway and opportunities to achieve total returns over the market cycle.
When did the strategy was launched and how it has worked in bullish and bearish periods ?
The fund was launched early 2004 as an outright convertible bond strategy; therefore it has a long track record of over 12 years. In 2015 we thought of revamping the investment approach in order to be able to benefit from more sources of alpha and better navigate across all market cycles. From September 2015 we introduced some hedging and overlay strategies with an unconstrained and flexible investment philosophy. In 2015 the fund posted an absolute performance net of fees of 5.82% for a realized volatility of 5.12%.
Since last September we have experienced some extremely distressed market conditions, with some of the main underlying equity markets losing more than 20% at some point between November and February.
Nonetheless the fund outperformed the convertible and equity markets, as well as the peer group. In fact the fund has realized positive absolute performances since the reshuffle, thanks to an active delta management (mainly via futures and a few contract for difference single name positions) and a rigorous liquidity and credit analysis resulting in a cash portfolio of majorly mainly robust credit names.
Lastly, we have implemented an active risk process and improved our downside risk management, both at the front office and risk management level. Such a process consists of definition of maximum acceptable loss, de-risking mechanisms (implemented with various levels of escalations triggers) and re-risking (activated by loss recovery).
Can the current actions of the ECB help your strategy and fund ?
We believe that the latest ECB intervention will impact the European markets positively. On the credit side it will support valuations within the investment grade space and in certain riskier credit sectors. On the equity side we believe that market volatility could temporarily ease which would also impact on the underlying.
All in all, while we do not think that the recent ECB actions will have a direct impact on convertible bonds, we nonetheless believe that in the short run it will positively benefit the underlying asset classes (i.e. credit and equity), as was the case in the past weeks. This shall also benefit our convertible bond strategies both outright and absolute return. Having said that, should volatility surge again, our absolute return strategy should fully benefit from it.
CC-BY-SA-2.0, FlickrPhoto: AJC ajcann.wordpress.com
. UBS Raises Record $471m for Oncology Impact Fund
UBS Wealth Management which will release its first quarter results this Tuesday and might announce a change in its business, has raised a record $471 million for the final closing of the UBS Oncology Impact Fund, an impact investing initiative aimed at developing cancer treatments.
Investments will be made in early stage oncology to accelerate the development of new cures. Cancer care is particularly appropriate for this kind of investment because of a supportive regulatory environment.
According to UBS, the market for cancer drugs is expected to grow faster than for any other disease, due to populations ageing in developed countries and an expanding middle class in emerging markets with better access to care. Oncology is the largest and fastest growing therapeutic area in terms of drug development activity, representing approximately a quarter of total research spend.
In addition to investing in early-stage cancer treatments, the Oncology Impact Fund will support academic research and better access to cancer care in the developing world. A portion of any performance fees generated and half of a royalty attached with best efforts to all successful drugs sales will be managed by UBS Optimus Foundation and ultimately fund expanded access to cancer care for children and their families in the developing world. The other half of the royalty amount will be spent on academic grants to promising oncology-related research. The Fund has already struck the first royalty agreement of this type, bringing this innovative practice from theory to reality.
Jürg Zeltner, President of UBS Wealth Management, says: “The record sum raised for the UBS Oncology Impact Fund is a milestone for our work in sustainable investing and for the impact investing industry as a whole. We believe initiatives like this can give hope to cancer sufferers and their families and divert more capital towards finding treatments and cures.”
Mark Haefele, Global Chief Investment Officer at UBS Wealth Management, says: “Impact investing gives our clients an opportunity to change the world and earn a financial return simultaneously. Using this growing medium to target cancer, one of the planet’s biggest killers, helps fulfil a critical social goal.”
Ansbert Gadicke, Co-Founder at bioventure investment manager MPM Capital, which is collaborating with UBS WM on the UBS Oncology Impact Fund, says: “We are delighted to be advising UBS on the management of this landmark fund. Over the long term, we hope this collaboration will add significant value in the field of oncology and in ongoing efforts to finance its development.”
CC-BY-SA-2.0, FlickrFoto: Fortune Live Media
. La lección de inversión más importante en el mundo para Warren Buffett es...
At the annual meeting of his Berkshire Hathaway, Warren Buffett stated that the US, the economy and his company would continue to grow saying, is a “remarkably attractive place in which to conduct a business.” He also defended his favorite stocks, mentioning he has “not seen evidence that convinces me that it’ll be more likely I reach 100 if I suddenly switched to water and broccoli,” but not everything he said was positive. Besides mentioning that some of his holdings are hitting tough spots, the Oracle of Omaha did warn about the risk of derivatives, and against consultants and Hedge Funds.
In his opinion, and given several years of poor returns, “probably the most important investment lesson in the world,” includes ditching expensive money managers. “Supposedly sophisticated people, generally richer people, hire consultants. And no consultant in the world is going to tell you, ‘Just buy an S&P index fund and sit for the next 50 years,’” he said. “You don’t get to be a consultant that way, and you certainly don’t get an annual fee that way.” His bet that a Vanguard Group Inc. fund that tracks the S&P 500 Index could beat a basket of hedge funds from 2008 through 2017 is going strong, with a 21.9% return from the bundle of hedge funds picked by Protege Partners while the S&P 500 index fund soared 65.7% in the last 8 years. The profits of the bet will go to charity.
On a follow up interview, Buffett also mentioned that he might consider taking money out of banks if they charge for deposits. Charlie Munger and him also criticized Valeant Pharmaceuticals, and Buffett, a Hillary Clinton supporter, implied that any one president, even Trump, could not derail the US economy, or his company’s business completely. “We’ve operated under price controls, we’ve had 52% federal taxes applied to our earnings… I will predict that if either Donald Trump or Hillary Clinton become president Berkshire will do fine.” He concluded.
Foto cedidaGuy Wagner, director general de BLI.. Banque de Luxembourg unifica sus unidades de gestión de activos
Banque de Luxembourg Investments (BLI), Banque de Luxembourg’s asset management company, has strengthened its multi-management team by recruiting Amélie Morel and Jean-Baptiste Fargeau as fund analysts. The team has now 5 people in charge of analyzing, selecting and monitoring an external fund list, as well as the management of the funds of funds multi-asset classes.
Amélie will be in charge of the follow-up of the asset classes European, SRI, sectorial and theme equities. Jean-Baptiste takes of the responsibility of the asset classes emerging equities and bonds and of high yield and corporate bonds.
“Following new recruitments in the past few years, mainly in the equities and fund distribution teams, we have also decided to strengthen our fund selection team”, says Fanny Nosetti, Head of BLI’s multi-management. “Amélie and Jean-Baptiste have gained first professional experience in other companies before joining us and they are an excellent addition to our asset management company. We are delighted to welcome them to the team!”
Amélie Morel (29) replaces Inès Buttet who left BLI. Following nearly three years auditing investment funds atDeloitte, Amélie worked as an investment analyst with a Luxembourg wealth structurer. Amelie holds a Master’s degree in Finance from Grenoble Ecole de Management and is a level 3 CFA candidate.
Jean-Baptiste Fargeau (36) has an engineering degree from Ecole Centrale de Nantes as well as a master degree in business administration from the IAE Paris. He started his career in Luxembourg in 2005 as a quantitative analyst within the management company J.Chahine Capital, and then became portfolio manager in 2007 in the same company.
CC-BY-SA-2.0, FlickrPhoto: Thomson Reuters. Seilern Investment Management Won Four New Awards
Seilern Investment Management have recently been acknowledged throughout Europe in the Lipper Awards, for the long-term performance of our funds. On 19th April in London, they announced the final round of UK and Pan-European awards, bringing the total to 14 awards in 2016.
Over the past weeks Seilern Investment Management have won awards for Best Equity Group (Small Company) in Switzerland, Germany, Austria, UK, and Europe and Stryx World Growth has won for Best 5 Year Performance in Switzerland, Germany, Austria, France, UK, and Europe.
“These awards are a testament to the commitment the team has in seeking out companies that demonstrate only the very highest prospects for long-term growth and reflect our consistency in generating returns for our investors. While we are gratified to be recognised, above all, we are pleased that we continue to deliver for our clients”, said Raphael Pitoun, Chief Investment Officer.
Capital Strategies Partners has an strategic agreement to cover Spain, Italy, Switzerland and LatAm market for Seilern Investment Management.
Foto: Ben
. Preqin reconocido en los 2016 Queen’s Award for Enterprise
Preqin has been awarded a Queen’s Award for Enterprise in the category of International Trade. The award recognizes Preqin as an outstanding UK business, citing excellence in its field and sustained growth in its overseas business. This year the awards, which are announced annually on Her Majesty the Queen’s birthday, praise 243 UK companies for leading the way in business achievement.
The Queen’s Awards for Enterprise are the UK’s highest official accolades for business success. Operating in various forms since 1966, they recognize UK businesses for outstanding achievement in one of three categories:International Trade, Innovation and Sustainable Development. Entrants come from all parts of the UK, from city-located centers of commerce to the remotest of locations, and include organizations involved in a wide range of industries and sectors.
CEO Mark O’Hare said of the award:
“It is a huge honor to be included in this year’s list of Queen’s Award winners, especially so on the occasion of Her Majesty’s 90th birthday. Over the past 13 years, Preqin has strived to deliver excellent products to our customers, becoming the leading source of data and intelligence for the global alternative assets industry. We are extremely proud and grateful to have this hard work recognized by the Queen’s Award panel. I would like to add my deepest gratitude to all of our directors, staff and partners for creating the culture of excellence, integrity, and dedication which characterizes Preqin, and without which this achievement would not be possible. Most of all, we are grateful to our many customers around the world for their longstanding support.”
Zurich-headquartered private bank EFG International has agreed to acquire the Luxembourg based private banking activities of UBI Banca International from Unione di Banche Italiane.
UBI Banca International (Luxembourg) has around EUR 3.6 billion in assets under management.
EFG International specified that the transaction is structured as a cash acquisition of UBI Banca International (Luxembourg) S.A. and will have no material impacts on EFG International’s regulatory capital position.
The deal is expected to close during the first half of 2017, and the company will merge into EFG Bank (Luxembourg) S.A..
UBI’s branches in Madrid and Munich are not part of the transaction, as well as its fiduciary and corporate banking activities.
It forms the second move of EFG International in the M&A activity since the start of 2016 as the company is to soon acquire the Lugano based private bank BSI, after an agreement has been signed on 21 February 2016 with BSI’s sole shareholder BTG Pactual.
The EFG International annual general meeting, scheduled on 29 April 2016, shall result in a shareholder approval for the transaction. The deal is to be closed in Q4 2016 and BSI is expected to entirely merge into EFG International at end 2017.