Foto: Origami48616. La estadounidense Scout Investments lanza un paraguas UCITS para ampliar su distribución global
Scout Investments recently launched a UCITS fund umbrella structure to further expand distribution of its strategies to non-U.S. investors.
The UCITS Fund will mirror Scout’s Unconstrained Bond Strategy and is currently registered in Luxembourg and Singapore, with plans to expand distribution into additional countries.
The Strategy is managed by lead portfolio manager Mark Egan and a seasoned team of fixed income investment professionals, including Tom Fink, Todd Thompson and Steve Vincent. The team has managed unconstrained fixed income accounts for more than 16 years and was among the first in the industry to do so.
“The cross-border distribution of Scout’s Unconstrained Bond Strategy allows us to offer non-U.S. investors a fixed income portfolio diversifier with a proven track record,” said Andy Iseman, chief executive officer of Scout Investments. “We plan to offer additional funds via the UCITS fund umbrella structure to continue to expand our global footprint.”
The objective of the strategy is to maximize total return consistent with the preservation of capital. Scout’s Unconstrained Bond Strategy seeks to maximize total return by systematically identifying and evaluating relative value opportunities throughout all sectors of the fixed income market.
The team may use derivative instruments, such as futures, options and credit default swaps, to manage risk and gain exposure. Given its objective, the strategy is not managed against a benchmark.
A UCITS (Undertakings for Collective Investment in Transferable Securities) is an investment vehicle that enables fund managers to distribute their products to non-U.S. investors.
Scout Investments, a global asset manager headquartered in Kansas City, Mo., manages more than $32 billion in equity and fixed income investment strategies for institutions and individual investors. Scout is the investment subsidiary of UMB Financial Corporation.
Foto: Epsos. La riqueza privada de América Latina presenta una oportunidad de oro para los gestores de activos globales
The priorities for a high-net-worth individual (HNWI) are: protecting their wealth in order to afford a comparable lifestyle throughout their retirement, actively growing their assets to support the needs of their families, and leaving an adequate estate to their loved ones.
In this issue of The Cerulli Edge-Global Edition, they focus on the high-net-worth market, including the main drivers of growth in demand for funds in the Gulf Co-operation Council (GCC) countries, the most effective points of entry to tap into Latin America’s wealthy, and an examination of the wealth erosion that takes place in American high-net-worth families.
Regarding to Latam, the study concludes that Latin America’s private wealth sector presents a golden opportunity for global asset managers who want to tap into the region. Economic growth and unprecedented wealth accumulation has prompted an increasing number of HNWIs to examine how they are able to preserve and enhance their assets.
At the last count, there were 1,587 billionaires in the world with a total net worth of US$6.5 trillion (€4.8 trillion). John D. Rockefeller is widely acknowledged to have been the first, achieving that status in 1916. The United States currently tops the leaderboard with 492 billionaires, but it has taken almost a century to get to this point. China, which had no dollar billionaires as recently as 2002, already has 152, and is second on the list, and Russia, which only freed itself from the shackles of communism in 1991, is third with 111.
That wealth is also spreading, with new billionaires in Algeria, Lithuania, Tanzania, and Uganda. London boats the greatest number of billionaires of any city with 72, (although only one-third were actually born British), followed by Moscow with 48, and New York with 43.
Making it onto this elite list is, however, no guarantee of future prosperity. Eike Batista is a case in point. In 2012, the Brazilian was the world’s seventh richest man with an estimated worth of US$30 billion. But in less than two years, a series of poor investment decisions has seen that pile almost disappear-and he now has to make do on less than US$300 million.
“The wealthy have something in common, and it isn’t just money. Worldwide, 95% of wealth creators and 91% of wealth inheritors are married. So the best providers don’t service high-net-worth individuals, they service HNW families.” says Barbara Wall, Europe research editor at Cerulli Associates. “To service these families, Cerulli has identified six key factors that providers should pay careful attention to.”
“Wealth preservation might not be the most pressing problem facing this elite,” notes Cerulli senior analyst Angelos Gousios. “However, they would do well to heed the advice of an ancient Chinese proverb-‘Wealth does not pass three generations’- because it is just as relevant today as it was then.”
Andy Rothman, autor de "Sinology". Matthews Asia desmitifica la inversión en China por medio de “Sinology”
Matthews Asia published last week its inaugural issue of Sinology, a publication designed to provide investors with a framework for understanding the Chinese economy and its impact on the global economy. The focus will be on longer-term trends, to help put in context the daily flood of China news. It begins with the first in a series of ‘demystifying China’ reports, to address some of the major misconceptions about the structure of Chinese economy.
According to Andy Rothman, author of the publication, the most fundamental misunderstanding about the Chinese economy is that it is dominated by state-controlled companies. The truth is that most Chinese work for small, private firms.
Private firms account for 82% of urban employment, as well as about 70% of investment and industrial sales.
The Communist Party still controls the financial system and many capital-intensive sectors, but most economic growth comes from entrepreneurial, small private companies, just like in the U.S. and Europe.
Misunderstanding these trends leads to understating the important role of Chinese entrepreneurs, who are the most dynamic part of the economy and drive its growth.
The Communist Party has shrunk significantly the number of SOEs and reduced the number of sectors where they operate, while scaling up the size of the remaining state firms and limiting competition in those sectors from private and foreign-owned companies. While the Party still plays an outsized role, especially through its control of the financial system, it has turned over most of the economy to Chinese entrepreneurs.
Schroders announced the appointment of Seth Finkelstein to the newly created role of US Product Manager, Portfolio Solutions within its Multi-Asset and Portfolio Solutions business (MAPS). Seth, who joins today, will be based in Schroders’ New York office and will report to Adam Farstrup, US Product Manager, Multi-Asset.
Seth has spent over 7 years at ING Investment Management where he co-founded the Multi-Asset Strategies & Solutions Group (MASS). He held the title of Senior Vice President & Client Portfolio Manager. Prior experience includes senior positions at Seneca Capital Management, Cohen & Steers and J.P. Morgan Investment Management.
Nico Marais, Head of Multi-Asset Investments and Portfolio Solutions: “In line with our strategy to build out our Multi-Asset and Portfolio Solutions capabilities in North America, we are pleased that Seth has joined us to take up this Portfolio Solutions role. Seth has strong skills in both multi-asset strategy and solution design, which is very exciting for us as we take another step in building our business in North America.”
The principals of Singleterry Mansley Asset Management – Gary Singleterry and Tom Mansley – have entered into an agreement under which they and their investment team will join GAM. Singleterry Mansley Asset Management was founded in 2002 and specialises in the evaluation and selection of complex mortgage and asset-backed securities based on analysis of macroeconomics, yield curves and underlying collateral structures.
The acquisition, structured as an asset purchase, is expected to close in June 2014. Subject to client consent, all of the company’s assets under management (USD 397 million as at 30 April 2014) and its client relationships will be transferred to GAM.
Singleterry Mansley has been managing mandates for institutions for 12 years. The team has built a strong track record of absolute and relative outperformance through a number of market, interest rate and credit cycles, including the crisis in the US housing and financial markets in 2007/2008 where they outperformed through anticipating movements in yield curve and credit risk, and then capitalised on opportunities after the crisis. Their flagship managed account – which uses no leverage – generated net annualised returns of 13.7% from inception in October 2002 to 30 April 2014, with positive returns in every calendar year.
At a size of around USD 7 trillion, the US mortgage-backed securities market remains one of the largest, most liquid and diverse sectors in global fixed income. The market’s complexity and depth plays to the strengths of experienced active managers who are skilled in understanding, controlling and profiting from a broad spectrum of risks. Singleterry Mansley invests in collateralised mortgage obligations (CMOs) guaranteed by government agencies, as well as in non-agency debt. Asset allocation and portfolio construction is driven by an analysis of interest rate, credit and prepayment risk and focuses on strong yield generation, liquidity and downside protection during sell-offs – an approach, which helped them to avoid exposures to sub-prime loans during the crisis.
For GAM Holding AG, this move represents an extension of its leading alternative and specialist fixed income capabilities. It will add a sought-after and distinct new specialist skillset to the Group’s USD 17 billion unconstrained/absolute return bond strategy and bring the total number of investment professionals supporting this strategy to 21. Singleterry Mansley’s offshore fund, launched in 2009, will be distributed under the GAM brand. In addition,in the coming quarter the Group plans to launch a new dedicated GAM- branded UCITS fund based on the same unlevered strategy the team has been managing since 2002. Gary Singleterry and Tom Mansley and their team will be based in New York, where GAM has had an office since 1989.
David M. Solo, Group CEO of GAM Holding AG, said: “Gary Singleterry and Tom Mansley are experienced and successful investors – their ability to navigate the severe market stress in 2007/2008 and produce strong positive returns speaks for itself. In particular, they share our Group’s commitment to a disciplined investment process based on deep analysis, combined with unconventional thinking. I look forward to having them on board and am convinced their skillset will be a tremendous addition to our current offering, allowing us to grow our asset base in line with our strategy.”
Gary Singleterry said: “We are very excited about joining GAM: Its global distribution network and its operational and compliance infrastructure will allow us to expand our reach into new markets and client segments. In particular, it will be great for us to work closely with GAM’s outstanding fixed income team and contribute to the future development and continued success of their unconstrained global bond strategy.”
Tom Mansley said: “The US market for mortgage-backed securities has been in a slow recovery mode over the past six years. Housing prices have improved, but remain affordable and mortgage underwriting standards became much stricter. The dominance of government- guaranteed issuance allows us to invest in a diverse universe of structured securities, and while private residential mortgage-backed securities issuance remains subdued, the secondary market for non-agency debt is highly attractive. Overall, this asset class offers interesting return opportunities and we look forward to making them accessible to a new and broader set of investors around the world.”
While most advisors are enjoying greater success than they did a few years ago, many are challenged with how to best communicate with their clients, according to new research released from Pershing LLC (Pershing), a BNY Mellon company. The Second Annual Study of Advisory Success: A New Age of Client Communications and Client Expectations explores the value of key client touchpoints and identifies opportunities for financial advisors to strengthen their connections and be more effective.
Study of Advisory Success is a longitudinal study that defines what success means for advisors in today’s environment and highlights the most salient issues that advisors face. Based on this year’s research, advisors who adapt to client communications preferences and expectations are more successful than those who do not.
“Lessons learned from the financial crisis, combined with the popularity of smartphones and other devices, have raised client expectations,” says Kim Dellarocca, managing director at Pershing. “With the proliferation of different touchpoints and a greater apprehension of financial risk, clients expect more frequent, tailored communications in real time, and many advisors have not yet developed a consistent communications strategy. It is essential for advisors to understand how, where and when current and potential clients prefer to communicate.”
Twenty years ago, advisors connected with clients through three primary channels: phone, mail and in-person meetings. Today, these channels have grown to include email and social media, which are ingrained in their clients’ lives, raising the bar for effective communications between advisors and their clients.
The study identifies three key areas in which advisors should focus their communication efforts and actionable steps they can take to improve in these areas:
Personal brand: Advisors who focus on their personal brands seem to enjoy greater success. More than half (53 percent) of advisors strongly agree that their personal brand is more important than their firm’s brand, but they are not always communicating their value proposition to clients. According to the study, one out of three advisors is missing a mission statement on their personal website, and a quarter of advisors do not have a mission statement on their team websites.
Advisors should see themselves the way their clients do, particularly online. Brands are most impactful in helping to attract and engage the right customers, and advisors should take the time to see themselves the way their clients and prospects do by taking the time to discover their own online presence through searches and then refining that presence to be more effective.
Social media: The study shows that advisors have mixed feelings about social media. Advisors can use it to engage many current and potential clients, and to share content quickly and easily. Two in five advisors do not use social media for business purposes, but among those who have used it for business, 73 percent reported positive experiences and an impact on their business. More than half (52 percent) of advisors feel that they have not invested enough time in social media, including 11 percent who say they do not spend enough time listening to their clients on those platforms. An advisor’s lack of presence on the web and social networks might deter younger prospects from becoming potential clients.
Advisors should capitalize on social media and become savvy content curators. While many advisors cite a lack of time as the reason for not using social media, there are a number of platforms that can serve as an efficient vehicle for listening, distribution and engagement. Advisors should have the ability to discern which information has value and is worth sharing. It is important that advisors do not overextend themselves. They need to make sure they are able to reasonably maintain any social properties they create. Advisors should value quality over quantity in this case.
Milestones: Relationships require regular contact and attention. Major lifecycle events such as retirement or divorce call for heightened personal attention, yet 20 percent of advisors do not reach out to clients in such circumstances, jeopardizing the client relationship.
Advisors should reach out about the good news, too. Clients are interested in hearing from their advisors regarding positive milestones, such as a birthday, new job or the birth of a child. Communicating with clients under a range of circumstances will make outreach in turbulent times less reactionary and forced.
“With client communication channels and protocols continuing to evolve, what advisors say and how quickly they respond counts more than ever,” says Dellarocca. “If they are not sure how their clients prefer to communicate, they should just ask.”
To obtain a copy of Pershing‘s Second Annual Study of Advisor Success: A New Age of Client Communications and Client Expectations, please visit pershing.com/advisorsuccess.
CC-BY-SA-2.0, FlickrK Twin Towers (Seul). La estadounidense KKR y LIM Advisors compran las K Twin Towers de Seul
KKR, a leading global investment firm, and LIM Advisors, a leading Asian-based multi-strategy investment group, announced the completion of the joint acquisition of K Twin Towers, a prime commercial property in Seoul’s central business district.
KKR and LIM Advisors made the purchase through the acquisition of 100 per cent of the common equity in a trust managed by Vestas Investment Management. Additional terms of the transaction were not disclosed.
Completed in 2012, K Twin Towers is a premium-grade commercial property located in the Gwanghwamun precinct within the Seoul central business district. It occupies more than 900,000 square feet [83,800 square metres / 25,300 pyeong] across 22 floors of premium office and retail space and has commanding views of the Gyeongbokgung Palace and the Presidential Blue House. K Twin Towers spans two office towers occupied by tenants that include major multinational and South Korean corporations, financial institutions and law firms.
K Twin Towers received a Green 2nd Rating from the government-backed environmental building certification system Green Standard for Energy and Environmental Design (“G-SEED”). This is the second-highest rating equating to ‘Excellent’ status in South Korea.
Bryan Southergill, Director, Real Estate, at KKR Asia, said, “We are very pleased to expand our real estate business to the South Korean market and to collaborate with LIM Advisors to acquire one of Seoul’s top commercial buildings.”
George W. Long, Chairman and Chief Investment Officer of LIM Advisors, said, “We are delighted to have been able to source and negotiate this investment and to work with our partner KKR to complete this major real estate transaction in the heart of downtown Seoul.”
Deutsche Asset & Wealth Management, Shin & Kim, and Deloitte advised both parties on the transaction.
Disclosure of financial information is obligatory for all companies listed on the main global stock exchanges. This information generally provides a good overview of a company’s financial performance, but it is not enough to make a decision about a company’s sustainability, which is linked to long-term operational and financial stability. Even companies with low levels of debt and high profits may be subject to potential risks from non financial areas such as environmental, social and governance (ESG) criteria. For instance, companies that do not embed human rights in their day-to-day activities may face less productivity and a higher chance of strikes, which can bring additional risks to investors. Similar problems may arise when a company does not apply solid environmental or governance practices.
The growing concern among investors about ESG issues has caused many companies to report information concerning their ESG-related indicators in the form of social reports, additions to their annual reports, special sections on websites and press releases. This information helps investors better evaluate companies’ risks and find possible ways to mitigate them. Yet, disclosure of such information is mostly voluntary among companies. In a report published by S&P Dow Jones Indices in cooperation with RobecoSAM, they analyzed to what extent companies from the headline indices disclose information concerning ESG activities. Companies studied include constituents of the S&P 500, S&P Europe 350, S&P/ASX 200, S&P/TSX 60, S&P/TOPIX 150, S&P Asia 50, S&P Latin America 40, S&P Korea LargeMidCap, and a number of additional companies from China and India. The disclosure records were provided by RobecoSAM.
These are the key findings (the complete report is attached)
The average level of transparency of the 1,504 companies included in the assessment in 2013 was 45, which is below the 0-100 range’s mean. The average score for disclosures related to corporate governance was 81, while the average score for the environmental component was 40 and the average score for the social component was 33.
The companies in the S&P Europe 350 had the highest average ST&D score among all the other headline indices from S&P Dow Jones Indices (average score of 63). The S&P Europe 350 was also the only index in which the average scores for all three components of assessment (environment, social and corporate governance) exceeded the 50-point average level range.
The research demonstrates significant differences in disclosure levels across regions. Companies in the U.S. index (the S&P 500),the Canadian index (the S&P/TSX 60) and the Australian index (the S&P/ASX 200) had veryhigh scores for disclosures related to corporate governance. However, their scores for disclosures of environmental and social components were much lower than those of Europe’s largest companies. European companies led in transparency on environmental and social issues. Companies in the Korean and Japanese indices, the S&P Korea LargeMidCap and the S&P/TOPIX 150, respectively, had high scores for disclosure of the environmental component, average scores for social component and the weakest of all scores for corporate governance-related disclosure.
Scores for disclosures of environmental and social components were correlated. This implied that for most companies, it was rare that a company disclosed information about the environmental aspect of its business but did not disclose information about the social aspect (and vice versa). This correlation does not apply to disclosure scores for corporate governance. In other words, a company’s decision to disclose information about corporate governance is independent of its decision to disclose information about social or environmental aspects of its business.
A company’s total ST&D score was strongly correlated with its market size, a relationship that applied across all geographies. So bigger companies tended to disclose more information: There was a significant correlation between a company’s size and its total ST&D score, which was clear on a regional level (see Exhibit 10). This correlation is likely explained by the fact that bigger companies tended to experience higher pressure from their shareholders and governments, so they disclosed more information. The correlation between a company’s size and its corporate governance disclosure score was generally less than the correlation between its size and scores for the other two components. This happened because the variance in scores for corporate governance was small, especially in jurisdictions where disclosure of significant parts of this information is required by the government.
Companies’ ST&D scores did not change significantly over time once they reached the 70- to 90-point range. However, ST&D scores tended to increase if they were lower than 70 and decrease if they were higher than 90.
Average scores for environmental and social components, when adjusted for changes in the scope of assessment, tended to grow over time. At the same time, scores for corporate governance generally stayed the same.
Average ST&D scores of developed countries exceeded the average ST&D scores of countries with emerging economies, but not significantly (46 vs. 40, respectively). This was most likely caused by bigger assessment penetration in developed countries. Companies from developed economies were more transparent than their competitors from emerging countries; however, the gap decreased from 12% to 6% in the period from 2010 to 2013. Countries with emerging economies were worse in terms of all components, but the difference in scores for the social component was insignificant. In 2012, developing countries were also worse than developed countries from the lens of all criteria, and the difference in scores for the social component was much greater.
The highest-scoring sectors were telecommunication services and utilities. These sectors’ profiles are likely attributable to the fact that in high-tech industries, the competition for investors’ capital is the greatest. Therefore, appreciation of shareholders’ interest in nonfinancial reporting is generally the highest.
Photo: Chris Talbot. Lucent Group Announces Opening of New UK Office
The Lucent Group, which specialises in strategic land development in high growth areas throughout the United Kingdom, is pleased to announce the establishment of a UK office in the City of Winchester, Hampshire. The office is a subsidiary of Lucent Advisors Limited, headquartered in the Isle of Man, which acts as advisor to the Lucent Strategic Land Fund.
The Winchester office is strategically located to allow the Group to take advantage of international and domestic transport links so that it can both effectively manage its expanding portfolio of projects throughout the country and also be close to the City of London institutional investor market.
The Winchester office will act as Lucent Advisor’s Project Management Centre offering asset advisory and project management services to the various projects the Group is undertaking. Its establishment comes at an exciting time for the Group.
The Allerdale Investment Partnership, a joint venture with Allerdale Borough Council, is expecting a determination on its first planning application, a 250 unit residential development, by the end of 2014. Several further planning applications will be submitted on the Partnership’s portfolio of sites in the near future.
In North Lincolnshire, work is progressing on the Lincolnshire Lakes development and a planning determination is anticipated later this year. Work is expected to start on the site in early 2015.
In Southampton, just 20 minutes away from the new office, a project team is already progressing the Royal Pier Waterfront Planning Application which will be submitted in Q1 2015. The initial round of public consultation is due to start this month.
Lucent has identified a project pipeline in excess of £50 million and is expecting to announce further acquisitions before the end of 2014.
Speaking about the new office, Chief Financial Officer Richard Quirk said “We are delighted to be opening an office in Winchester. This is an important step in our company’s evolution and underlines the importance we place on Southampton’s Royal Pier Waterfront project. The establishment of the office in the UK will provide effective support for the growing number of land projects that Lucent is bringing forward for development. Furthermore, it gives us an international hub with close proximity to the City of London.”
The Group’s administrative and broker functions for the Lucent Strategic Land Fund will remain unchanged and stay with the Isle of Man headquarters.
The Winchester office will be fully operational by the end of June 2014.
Foto: Christos Tsoumplekas, Flickr, Creative Commons. Modificación de la ley de sociedades de capital para mejora del gobierno corporativo
Morgan Stanley Alternative Investment Partners (AIP) has obtained $500 million in commitments for AIP Strategic Opportunities Fund I (SOF I), a closed-end investment fund that seeks to capitalize on medium-term opportunities in the hedge fund space. SOF I will focus primarily on hedge fund secondaries, hedge fund co-investments and other opportunistic hedge fund strategies. Mark van der Zwan and Jarrod Quigley, Managing Directors, are SOF I’s primary portfolio managers.
“We are pleased that we have achieved our fundraising goal for SOF I,” said Mustafa Jama, Chief Investment Officer of the Morgan Stanley Alternative Investment Partners Hedge Fund group. “We believe that the fund is well positioned to capture value by investing in opportunities with a two- to five-year duration. The withdrawal of traditional capital providers, such as banks and proprietary trading desks, from this segment of the market should, in our view, enable highly selective investors with patient capital to generate attractive returns.”
“Our AIP Hedge Fund group is world-class, and this successful fundraising effort marks the latest in a long string of achievements,” said Arthur Lev, Head of AIP. “The team is among the most experienced buyers of hedge fund secondaries and has access to a strong set of top-tier hedge fund managers pursuing niche opportunities in this area of the market.”
The AIP Hedge Fund group has over $20 billion in assets under management and advisement as of March 31, 2014.1 The group’s headquarters are located in West Conshohocken, Pa., with additional offices in New York and London.
Established in 2000, AIP has approximately $35.8 billion in assets under management and advisement.2
1As of March 31, 2014, Morgan Stanley AIP’s total fund-of-hedge fund assets of approximately $20.2 billion comprises approximately $12.5 billion of assets under management and approximately $7.7 billion of assets under advisement.
2As of March 31, 2014, Morgan Stanley AIP’s total assets of approximately $35.8 billion comprises approximately $28.0 billion of assets under management (AUM) and approximately $7.8 billion of assets under advisement. Approximately $1.5 billion of assets cross-invested across AIP product lines have been subtracted from the total so as to avoid double-counting. AUM is based on (i) total net asset value of its fund-of-hedge-funds managed investment vehicles and separate accounts; (ii) value of all partners’ capital accounts and investors’ invested capital, plus their respective unfunded commitments, of private equity funds of funds and private equity separate accounts; and (iii) value of all partners’ capital accounts and investors’ invested capital, plus their respective unfunded commitments, of real estate funds of funds and real estate separate accounts. The value of private equity and real estate assets under management in separate accounts not solely dedicated to private equity or real estate investments managed by the relevant team is defined as the carrying value of all private equity or real estate assets, plus unfunded private equity or real estate commitments.
