Wikimedia CommonsBy Kevin.B. ING US IM Appoints Bas NieuweWeme as Managing Director and Head of Institutional Distribution
ING U.S. Investment Management has appointed Bas NieuweWeme as Managing Director and Head of Institutional Distribution. NieuweWeme, who reports to Shaun Mathews, Executive Vice President and Head of the Client Group, will oversee all aspects of the institutional business, setting strategic direction across U.S. and international sales, consultant relations, RFPs, client service and relationship management.
“Bas is uniquely qualified to lead our institutional business and – together with his team – will continue to build on the positive momentum we have achieved across our distribution channels. In the first half of 2013, ING U.S. Investment Management generated third-party net flows of $5.8 billion, and third-party assets under management have grown to $110 billion as of June 30, 2013, compared to $91 billion a year ago”, said Mathews.
NieuweWeme has worked at ING for 13 years, most recently as Senior Vice President and Head of Institutional Sales with ING U.S. Investment Management.
Earlier in his career, NieuweWeme held various domestic and global marketing and sales roles for ING. Prior to joining ING, he worked for the tax consultancy group at PricewaterhouseCoopers. NieuweWeme holds an Executive MBA from the New York University Stern School of Business and a law degree from the University of Amsterdam, School of Law.
ING U.S. Investment Management, which plans to rebrand in the future as Voya Financial, is a subsidiary of ING U.S., Inc. and has approximately $190 billion of assets under management.
According to preliminary figures from ETFGI’s Global ETF and ETP industry insights report, near record net inflows of US$44.08 billion and strong market performance helped to push global ETF and ETP assets to US$2.16 trillion at the end of July 2013. There are now 4,883 ETFs/ETPs, with 9,925 listings, from 209 providers listed on 57 exchanges.
“Dovish comments from the Fed and positive market performance encouraged investors to put net inflows of US$44.08 billion back into the market through ETFs/ETPs” according to Deborah Fuhr, Managing Partner at ETFGI.
Equity
In July, Equity ETFs/ETPs gathered the largest net inflows with US$41.62 billion. North American/US equity ETFs/ETPs gathered the largest net inflows with US$32.99 billion, followed by European equity indices with US$3.51 billion, and developed Asia Pacific equity with US$1.82 billion.
Fixed Income
Fixed income ETFs/ETPs experienced net inflows of US$5.1 billion. High yield ETFs/ETPs gathered the largest net inflows with US$3.0 billion, followed by government bonds with US$2.2 billion, and corporate bonds with US$868 million, while inflation-linked fixed income ETFs/ETPs experienced the largest net outflows with US$650 million.
Commodity
Commodity ETFs/ETPs saw net outflows of US$2.72 billion. Precious metals ETFs/ETPs experienced the largest net outflows with US$2.19 billion, followed by energy, and agriculture with net outflows of US$223 million and US$175 million, respectively.
Providers
SPDR ETFs ranks first based on July net inflows with US$17.8 billion, and fourth YTD with US$11.8 billion. Meanwhile, Vanguard ranks first based on net inflows YTD with US$36.17 billion, and third in July with US$7.31 billion. iShares ranks in second place for both July and YTD net inflows, with US$10.9 billion and US$32.47 billion, respectively. WisdomTree and PowerShares rank in third and fifth place in YTD net inflows with US$11.85 billion and US$9.61 billion, respectively.
Juan Garrido (above), and Les Baquiran, co-directors of the LatAm Chapter in HFA. Hedge Fund Association Appoints Juan Garrido and Les Baquiran Co-Directors of LatAm Chapter
The Hedge Fund Association has announced new regional leadership appointments. Victor Hugo Rodriguez, the first director of the HFA’s LatAm Chapter, is passing the reins to prominent hedge fund industry pioneers Juan Garrido and Les Baquiran.
Juan Garrido is global head of investment solutions at BBVA Global Private Bank in New York. He has almost two decades of market experience and a sound understanding of asset and wealth management, financial products and services, and infrastructure. Juan oversees BBVA’s Wealth Management’s global investment strategy, asset allocation and recommended catalog of products and services, is a member of the Global Private Banking Steering Meeting, and chairs the Global Wealth Management Meeting.
Les Baquiran was a New York-based principal at Park Hill, an alternative investment placement agent that is part of the Blackstone Group. Prior to joining Park Hill, he was a Managing Director at ISI in Institutional Sales and before that worked at Brown Brothers Harriman as an Equity Research analyst. Les has guest lectured or advised on curriculum on investment management and emerging markets at Yale, Harvard, Stanford, and New York University.
“Victor is clearly a hard act to follow but Les and I both look forward to facing the challenge of further developing the HFA’s activities in the Latin America region,” said Juan Garrido, Co-Director of the HFA’s LatAm Chapter. “I agree wholeheartedly. Whichever metaphor you choose to describe the magnitude of what lies before us, we will both need to be at our best to match, let alone emulate, what Victor has achieved to date,” added Les Baquiran, Co-Director of the HFA’s LatAm Chapter.
Victor Hugo Rodriguez became the director of the HFA’s LatAm chapter when it was launched in March 2011. The founder, president and CEO of LatAm Alternatives, he has over 17 years of experience in management, sales, marketing and business development within the securities industry in the U.S.-LatAm region. He was partner and head of Latin American Prime Brokerage for Merlin Securities and Director of Global Institutional Sales at TradeStation Securities. He has also been a live TV economics news anchor.
“It has been a privilege to head the HFA’s efforts in Latin America over the past two years,” he said. “I know that Juan and Les will strive just as hard to carry on all the good work we have done in that time, and I will of course remain available to help and advise them when and where necessary.”
“These appointments are designed to maximize the impact that the HFA already has in the LatAm region, and I am certain they will do just that,” said Mitch Ackles, HFA President. “The diversity and richness of the talent available to our members in Latin America and around the world never fails to impress me.”
Wikimedia CommonsFoto: AT&T. Morgan Stanley nombra a un ex directivo de AT&T miembro de su consejo de administración
Morgan Stanley announced that Rayford Wilkins, Jr., has been elected to the Company’s Board of Directors, effective August 1, 2013.
Mr. Wilkins, 61, most recently served as CEO of Diversified Businesses at AT&T, a position from which he retired in March 2012. Previously in his career, Mr. Wilkins held several leadership roles at AT&T and its predecessor companies, including Group President of Marketing and Sales at SBC Communications, President and CEO of SBC Pacific Bell, and President and CEO of Southwestern xBell Telephone, among others.
Mr. Wilkins’ appointment will bring the size of Morgan Stanley’s Board to 15 members. He will serve on the Board’s Nominating and Governance Committee.
James Gorman, Chairman and CEO of Morgan Stanley, said: “I am very pleased to welcome Mr. Wilkins to our Board. He brings highly relevant leadership experience, both domestic and international, having managed through extensive change and transformation during his long career. His perspectives will benefit our other Directors, our management and our shareholders.”
Mr. Wilkins currently serves on the boards of Valero Energy Corporation, América Móvil and YP Holdings. He is also a member of the Advisory Council of the McCombs School of Business at the University of Texas at Austin, where he holds a bachelor’s degree.
The summer of 2013 has seen a spate of social unrest episodes across the emerging market space. The riots had two things in common. First, they were sparked by a government decision affecting daily life. In Turkey, it was the government’s decision to change the use of Istanbul’s landmark Taksim Square; in Brazil, it was the decision to hike bus fares; and in Bulgaria and Indonesia, it was higher electricity and fuel prices, respectively. Second, protesters are not affiliated with political parties or movements, and they are well educated members of the middle class.
This was not the first time that the middle class has been at the epicenter of social unrest. The now developed economies suffered a spate of social unrest during the “long nineteenth century”,when the rise of a middle class of traders, entrepreneurs and better educated people fuelled demand for better living standards and more representation in political governance.
This report, signed by Manolis Davradakis, Senior Emerging Economist, AXA Investment Managers, attempts to examine the root causes of the recent episode of social unrest in emerging markets and rank the various emerging economies on the basis of their performance in the area of institutional governance, which matters a lot to the middle class.
The middle class revolution
The world’s middle class is growing and is expected to continue to do so. It is expected to become more populous compared to the poor by 2022, with its size climaxing at 4.9bn people by 2030, doubling its size in 2009, according to the European Union Institute for Security Studies. Middle classes will grow the most in Emerging Asia, followed by Sub-Saharan Africa, MENA and Central and South America (Exhibit 3).
Indeed, high levels of economic development render people more open-minded, leading to more emphasis on self-expression and more participation in the decision-making process.Knowledge societies cannot function effectively without highly educated citizens who are accustomed to thinking for themselves. Beyond a certain point, repressing mass demands for a more open society becomes costly and economically ineffective. Government unwillingness to acknowledge the people’s right to freedom of expression and a voice in decision-making is a source of social unrest.
Everyday problems all the same
As more people join the ranks of the middle class, existing institutional structures prove to be unable to accommodate the aspirations of members of this class for swift economic and social advancement. Middle class members realize that although they earn more now and are wealthier than before, they still face the same malaises as the poorer strata of the population
The crime rate in several emerging markets overshoots that of OECD countries by a large margin. Indeed, the homicide rate is the highest in South Africa, Mexico and Brazil, all three members of the G20 (Exhibit 4).
High crime rates force people to spend a large share of their income to protect themselves and their properties, diverting funds from more productive uses and impeding entrepreneurship.
Also, public spending for education and health care are lagging behind in emerging compared to developed economies.
Investment implications
Social unrest may have implications for emerging market ratings. Specifically, the combination of the current account deficit widening, foreign capital outflows in the aftermath of US Federal Reserve’s QE tapering off, and prolonged social unrest could result in Turkey’s sovereign credit rating outlook and Brazil’srating being downgraded.
Fitch has warned that poorly handled enduring social unrest could put Turkey’s investment grade at risk, while Moody’s has stated that a spike in political risk is a rating negative event. We believe that the two rating agencies will most likely opt for an outlook downgrade at first to prevent the reputation damage that would emerge should they relinquish the investment grade less than a year after receiving it.
The rating action on Brazil could imply a sovereign rating downgrade, most likely by Standard and Poor’s, which downgraded the country’s outlook to Negative in June 2013. In Brazil’s case, rating agencies do not face the same reputation risk that they face in Turkey. A rating action could take place by end- August, within the two-month period after the outlook change by Standard and Poor’s.
Wikimedia CommonsFoto: mattbuck . ¿Qué estrategias reciben más consultas en Morningstar? La renta variable global gana posiciones
Individual investors, advisors, and institutions continued to show interest in large-cap equity strategies in the first half of 2013, according to a list of the most-researched investments in Morningstar’s platforms. The mid-year snapshot also finds individual investors seeking dividends, financial advisors exploring allocation funds and income investments, and institutions searching for opportunities internationally.
Highlights of the most-researched investments in Morningstar platforms during the first half of 2013 include:
Seven of the 10 most-researched separate accounts by institutional investors were large-cap growth strategies. Two value strategies also ranked in the top 10.
A bank loan strategy made the list of both the top funds and ETFs researched by individual investors—no bank loan strategies made the individual investor lists in 2012.
Financial advisors’ most-researched mutual funds focused on large-cap equity and allocation funds, while the number of fixed-income funds on the list declined from 2012.
Emerging-markets ETFs were most popular among individual investors, while advisors showed particular interest in bond ETFs and large-cap strategies; though an energy sector ETF topped the advisor list after not making the list during the previous period.
“Core equity and bond strategies largely remain the most-researched investments across our main product platforms, but changes to the number of searches in niche categories indicate that investors were switching gears in the first half of the year,” Paul Justice, director of fund research for Morningstar, said. “In the institutional segment, we saw a dramatic increase in interest in international preferred stock and junk-rated domestic bonds, likely because of the rapid shift in interest rates in the United States.”
“Within separate accounts, the new additions to the list indicate how institutions have changed sentiment,” Justice added. “According to searches in our software platforms, portfolio managers seem to be reinvigorating their search for income and international exposure following the rise in interest rates and perhaps the overheated performance of U.S. equities relative to the rest of the world.”
Most Researched Investments, Jan. 1 — June 30, 2013—Individual Investors (Morningstar.com):
Wikimedia CommonsBy Presidencia. Peruvian AFPs May Directly Register Their Investments in Foreign Mutual Funds
A few days before it became mandatory for Peruvian citizens to choose between the Private Pension System (SPP)and the National Pension System (SNP) to provide for their retirement, the Superintendence of Banking and Insurance (SBS) and the Peruvian President Ollanta Humala Tasso announced that they will seek to streamline investment in the stock market by private managers.
In his speech commemorating the 192 nd Anniversary of National Independence last week, the president said “This reform complements the one carried out to our Private Pension System, in order to expand pension coverage, increase the profitability of our funds, and benefit members; to date having achieved the reduction of commissions to a third of the average charged .”
Through a draft resolution, which shall receive input from the public until August 26th, the SBS proposes the “elimination of registration of instruments and fund operations,” thereby seeking to shorten the timeframes for the authorizations issued by the regulatory authority when transferring the registration of “instruments which are considered simple” such as local and foreign fixed income investments, foreign and local equities (stocks), and foreign mutual funds, to the AFPs.
Wikimedia CommonsBy Wall Papers Wide. Afores Back in the Green Zone in July
After a two-month low at the end of last July, the Retirement Savings System in Mexico (SAR) rose, registering 1.9 trillion pesos (approximately USD $154 billion) under management, according to figures released by the National Savings System for Retirement Commission (Consar).
These resources, derived from over 49 million individual employee accounts, increased by over 33 billion pesos (approximately USD $2.7 billion), representing a rise of 1.76% on the balance as at the end of June 2013, and generated historical returns for the system of 12.74% nominal annual average and 6.27% in real terms during the SAR’s 16 years of operation, a slight increase on the 6.22% previously recorded.
The performance over the past 12 months has been lowered to 2.94%, mainly affected by the past two months, while the performance over five years is 10.25%, a slight recovery compared to 10.20% of the previous month. The system’s average net return over 51 months is equivalent to 10.8%, a figure which remains unchanged from last month, although with the Consar’s new reporting system, (which adds a month every month to update the System’s Net Yield) these figures can’t be really compared.
Wikimedia CommonsBy mattbuck. Standard and Poor’s Upgraded Grupo Sura’s Credit Rating to BBB
Standard and Poor’s has upgraded GRUPO SURA’s credit rating from BBB- to BBB for which it has issued a stable outlook. This upgrade symbolizes the progress that the company continues to make in consolidating its Latin American operations, its sound business performance in various parts of the region as well as the financial robustness of its investments. S&P acknowledged, amongst other factors, the company’s flexibility in accessing capital, its robust investment portfolio, and stable incoming dividend flows.
“This upgrade, for which we have issued a stable outlook, mirrors our expectations that GRUPO SURA’s investment portfolio shall continue to provide important streams of dividends, which shall allow the Company to continue with its mid-term growth strategy in various strategic sectors, without this entailing any structural increase in the Company’s indebtedness”. Statement contained in this latest ratings report issued by Standard and Poor’s.
This BBB rating, confirming the company’s sound financial position compared with the highest international standards, was also based, according to the S&P report, on the ING acquisition, currently known as Sura Asset Management, with regard to which, GRUPO SURA managed to reduce its total gross debt within a period of just 12 months while at the same time obtaining an increase of 47% in dividends received during 2012.
“We are very pleased to receive this report announcing an upgrade for GRUPO SURA’s long-term credit rating, since it underscores the Company’s sound position. This Triple B rating, with a stable outlook, substantiates GRUPO SURA’s skillful management of its investments. We have handled our finances in a careful and consistent fashion, so as to maintain adequate levels of indebtedness” stated David Bojanini, GRUPO SURA’s Chief Executive Officer.
This report also acknowledged that GRUPO SURA’s investment portfolio is benefiting from the growth opportunities to be had in Latin America, without any need to increase its levels of debt. It also confirmed stable streams of dividends and adequate cash flows going forward.
Wikimedia CommonsFoto: Eric Ward. Los norteamericanos le tienen más miedo a invertir en bolsa que a la muerte
A new Nationwide Financial survey conducted by Harris Interactive found that Americans are more afraid of investing in the stock market than they are of losing their jobs, public speaking and even dying. And despite those fears, many – especially younger investors – would rather use a website for their financial planning needs than meet with an investment professional.
According to the “Fear of Financial Planning” survey released today, of the 783 potential investors over the age of 18 who had at least $100,000 in investable assets, 62 percent are scared of investing in the stock market, while 58 percent fear death, 57 percent fear public speaking and 37 percent fear losing their jobs. Despite this revelation, more than one in two millennials and nearly half of generation X (58 and 48 percent) turn to websites before financial advisors for help with financial planning.
The survey also found 83 percent of respondents are afraid of another financial crisis, while 72 percent are concerned their personal health care costs will become unmanageable and 71 percent worry they will not be able to pay for their children’s education.
“Even with the recent uptick in the markets, we still hear from our financial advisor clients that investors are very skittish. We wanted to dig deeper to understand their fears related to their financial security, and to help advisors address them,” said Michael Spangler, president of Nationwide Funds, Nationwide Financial’s mutual fund business. “Americans are increasingly moving toward managing their own assets and investments. For their practices to be sustainable, advisors need to focus more resources on demonstrating their value to both existing and prospective clients.”
Rather than working with an investment professional, generation X and millennials are more likely to use websites as their primary financial planning resource. Forty-three percent of generation X and 51 percent of millennials use an advisor for their financial planning needs, which is fewer than those using websites (48 percent and 58 percent). However, 78 percent of retirees and 61 percent of high-net-worth investors (those with $250,000 or more in investable assets) use a financial advisor as their top resource for financial planning needs.
The study was conducted online within the United States by Harris Interactive on behalf of Nationwide Financial from March 26 – April 3, 2013, and participants included 783 Americans ages 18 and older with a minimum of $100,000 in investable assets. This online survey is not based on a probability sample and a therefore no estimate of theoretical sampling error can be calculated.
