Wikimedia CommonsFoto: Khalidshou . CICC IM y PineBridge lanzan el primer fondo mundial de hedge funds dirigido a inversores chinos
CICC Investment Management (USA) and PineBridge Investments announced the launch of the first global fund of hedge funds (“Fund”) on April 1 targeting qualified Chinese investors. The launch of the global fund of hedge funds demonstrates the strategic decision of CICC Investment Management (USA)’s parent company, China International Capital Corporation Limited (“CICC”), to expand its investment management business globally.
PineBridge and CICC Investment Management (USA) have both invested proprietary capital to seed the Fund and ensure alignment of interests with investors. CICC Investment Management (USA) serves as the Fund’s investment manager and PineBridge as its sub-advisor. CICC Investment Management (USA) will leverage its resources in Beijing and New York. The PineBridge Hedge Fund Solutions team is primarily based in New York, London and Hong Kong.
The Fund intends to invest in a diverse range of hedge funds globally across equity long/short, event driven, global macro/CTA, and relative value strategies. Potential managers of these hedge funds are expected to have outperformed HFRX, with proven track records and assets under management ranging from the hundreds of millions to billions of dollars. The Fund aims to generate attractive risk adjusted returns with low volatility and low correlations with the broad markets. Investors in the Fund will benefit from exposure to successful hedge funds globally through a diversified portfolio supported by CICC’s direct market investment experience and PineBridge’s 30-year history in hedge fund investing.
Wikimedia CommonsFoto: Kishore Mahbubani y Jim Walker. Robeco, hosts the battle of the Titans for the future of China
China’s short-term prospects are bleak, with a recession ahead, Jim Walker told the Robeco World Investment Forum. But its longer-term rise, along with the wider Asian region, is unstoppable, countered Kishore Mahbubani.
China’s economy is faltering. First-quarter GDP growth disappointed, with a 7.7% year-on-year increase. That was lower than both the 7.9% reported for the final quarter of last year and the consensus expectation of 8%. Moreover, the government is warning that the country has entered an era of lower growth, as it presses on with rebalancing the economy from a focus on investment and exporting to domestic consumption.
What are the implications of this shift, both in the short term and in the long term? Where is the country heading in the next few years? And is China still on course to overtake the US as the world’s largest economy?
For Jim Walker, managing director at Asianomics, the independent economic research company, China is at a critical juncture. And the outlook is not good. “We think there’s a recession ahead for China,” he said. “Not just lower growth, but a recession.”
China saved the world but killed itself
Why? “China killed itself when it saved the world in 2009,” said Walker. That is because of the extraordinary credit expansion since the start of the financial crisis. In 2009, the Chinese injected new credit into the economy equivalent to 43% of Chinese GDP, or 16% of US GDP. They followed up by repeating the act in 2010, 2011 and 2012, when new credit was equivalent to 41%, 37% and 37% of Chinese GDP respectively.
At the same time, the growth rate is slowing. Walker argued that rather than the official 7.8% for GDP growth last year, digging into the supporting data suggests that 5% is a more realistic figure.
New credit increased further in Q1 2013
“This credit expansion cannot continue, can it?,” he asked. “Well, actually, in the first quarter of this year, it accelerated.”
The inevitable result of these floods of money is overcapacity across the economy. “When countries have overcapacity, they don’t make money in their corporate sector,” said Walker. And that is the case in China, he said, as the earnings reported by companies there “don’t actually exist”, thanks to accounting sleights of hand. Tellingly, operating cash flow as a percent of net profit was only 54% in China in 2011, against a typical figure in most counties of 100-120%.
“To improve that cash flow position, to improve the companies’ balance sheets, they’ve got to cut capital expenditure. And banks have got to stop lending to them,” he said. “When that happens, you get recession.”
New political leadership has its hands full
A further issue is China’s new leadership. Walker told the forum that his Beijing contacts are positive about the new leadership’s efforts in fighting corruption and moving the economy away from the state sector.
But he’s not so sure. For sure, they have been dealt a bad hand. “Corruption, corruption, corruption. China is ripe, rotten with corruption,” he said. “There is a clampdown on corruption. But is it enough?”.
The answer is: probably not. “They’ll take China forward to feather their own nests and to make sure that their pockets are full,” he said. “They know how to accumulate money like nobody else on the planet.” Moreover, the acceleration of credit growth in the first quarter of this year suggests to Walker that “more of the same” can be expected from the new leadership.
Still, Walker’s picture of China isn’t 100% gloom. “The Chinese take such crises on the chin,” he commented in his interview “Recession in China will come as a surprise”, before they bounce back.
Mahbubani: a major historical aberration is ending
According to Kishore Mahbubani, Professor in Public Policy at the National University of Singapore, China’s bounce-back is long overdue. Mahbubani’s stock in trade is not so much the rise of Asia but its return.
He argues that until 1820, the world’s two largest economies were China and India. And after two centuries of Western domination, the world is returning to the historical norm of the previous two millennia. In this longer-term perspective, the supremacy of the UK and the US should be viewed as “a major historical aberration”. “All aberrations come to a natural end,” he said.
For Mahbubani, “the big question” about Asia’s return to the center stage of world history “is why? And why now?”
Asians have learnt best practices from the West
His answer is that Asians have absorbed and understood Western best practices in many areas, from free-market economics to innovation in science and technology. “If you want to find the greatest psychological conviction about free market economics, it used to be in the West. Now, it resides in Asia,” he said. They have also instilled in many cases a belief in meritocracy and the rule of law, and developed what he referred to as a “culture of pragmatism”.
How meritocratic is China?
But just how meritocratic is China? The author of The Great Convergence: Asia, the West and the Logic of One World rejected the notion that nepotism offers an easy entry route into the country’s political elite, pointing to the intense struggles behind the scenes in the Chinese communist party.
“These guys fight their way up,” he said. And that, he said, has a positive effect, allowing only the cream to rise to the top: “The quality of the minds of the people at the top in China is probably among the best you’ll ever find.” That is quite a different interpretation of the Chinese leadership to Jim Walker’s.
Still, Mahbubani accepts there are risks for China, both internally and externally. At home, inequality is on the rise and the exploding middle classes are demanding more government accountability, creating some political uncertainty.
No avoiding Sino/US geopolitical competition
Abroad, there are geopolitical tensions within the Asian region, such as the squabble with Japan in the East China Sea over the Senkaku/Diaoyu islands, and with the US, whose number-one position in the global economy China is challenging. “Rising geopolitical competition between China and the US is inevitable,” said Mahbubani.
But he believes the Chinese government is too pragmatic to allow such tensions to have a long-term impact on economic relations. Moreover, he feels that the interdependence of the world economy, through trade and financial links, make the likelihood of war extremely unlikely. “There will be geopolitical rivalries. There will be no geopolitical wars,” he argued. “The US & China will actually work together in economic co-operation.”
Will China become the world’s #1 economy
So where does that leave China’s progress to economic top dog? For Mahbubani, it is just a matter of time—and not that much time either. He said that by 2017, China’s share of global GDP will have risen to 18.2% in purchasing power parity (PPP) terms, when the US’s share will have dropped to 17.6%.
Walker was more skeptical. “China will become the biggest economy in the world as long as it keeps printing numbers that don’t mean anything,” he noted.
In the wake of the financial crisis, advisors to either institutional investors or high net worth investors need a drastically different set of skills and personal qualities to succeed, according to a white paper just released by BNY Mellon, the global leader in investment management and investment services.
“The Conscientious AdvisorSM: A New Paradigm in Wealth Management Sales” co-written by Tracy Nickl, Executive Director of Sales for BNY Mellon Wealth Management and Jennie Hollmann, PhD. of Caliper Management, asserts that today’s successful advisor must be more methodical and conscientious when dealing with clients and prospects. Furthermore, the paper contends, firms should establish a conscientious platform that helps their advisors succeed and prepares them for career advancement. The result, say Nickl and co-author Hollmann, whose firm is a workplace productivity and talent recruitment and development consultancy, is not only having happier clients but also more satisfied and more successful employees.
“It’s clear to us that since 2008 high net worth investors have become more skeptical about our financial system. What these investors want and need in a trusted advisor has changed dramatically. Our paper offers some insights into what Conscientious Advisors—and their companies—must do to better serve these clients,” said Nickl.
In addition to retaining and winning new business, companies that adopt the Conscientious Advisor/Conscientious Platform model stand to benefit in other ways. “BNY Mellon adopted the Conscientious Advisor model in early 2010 and by the end of 2012 our sales force turnover dropped by 50 percent and the average new business revenue for a sales director had jumped by nearly 20 percent,” said Nickl.
Nickl contends that a Conscientious Advisor shows:
Commitment: Cares about clients and focuses on empathy, listening, over-preparing for every client interaction
Collaboration: As part of a team over-prepares for each meeting and offers holistic solutions, not product
Credibility: Asks the right questions, exhibits professionalism and transparency that reinforce one’s personal brand
Consistency: Follows repeatable processes, executes flawlessly, always follows up and always follows through
Just as importantly, Nickl adds, firms must do their part to support their advisors with a conscientious platform that promotes and rewards conscientiousness through:
A defined, repeatable sales process
A “think tank” model for developing solutions for clients
Foto: Frydolin
. Las redes sociales cobran fuerza entre las empresas de wealth management
The advent of social media presents a valuable opportunity for wealth management companies. As internet access and smartphone adoption increase, a growing number of internet users are becoming involved with social networking. Companies are developing their processes to be able to respond to web-oriented consumers. Banks and other wealth management institutions are engaging customers with social media, which is shaping up as a strong channel for promoting new schemes, identifying customer needs and receiving feedback online, as a Trimetric Report.
Companies have started to use social media sites as a marketing tool to communicate with external customers and to promote their products and services. These companies use YouTube and Flickr to post videos relating to products and services, key developments, events and conferences. Online video is an important part of the modern internet landscape, reaching a large number of people in an engaging context that is attractive to marketers and advertisers. Companies are marketing their services by posting presentations and brochures on open sharing platforms such as Facebook and Slideshare. Many have launched their own social networking forums and blogs to connect with customers. The cost-effectiveness and large reach make social media one of most preferred advertisement channels among wealth management companies.
Due to the growth and popularity of online channels, wealth management companies are now expected to deliver a personalized online customer experience through social media tools. The sector today is investing in platforms such as sites, blogs and video sharing to create awareness and to expand their reach.
The ultimate goal of adopting social marketing is to attract new customers and generate increased loyalty across existing customers, which will help companies to increase their revenues and profitability in the long run. Social Media interactions provide companies with a platform to reach out to customers and deal with issues in real time, therefore increasing both the quality of their service and their levels of consumer trust.
Global social media sites continue to dominate the social media landscape; however, local companies are beginning to show signs of resistance and are now competing for a share of the market. Social media has been one of the preferred digital advertisement channels among wealth management companies. Wealth management companies are increasing their investments in analytical tools to understand the consumer behavior.
Social media marketing is gaining in popularity as the companies are using it to inform consumers about their product campaigns and other product launches. The increasing prevalence of the internet and widespread adoption of Smartphones have fuelled social media expansion. Companies have started to use social media sites as a marketing tool to communicate with external customers as well as to promote their products and services.
Facebook, Twitter and LinkedIn have managed to establish themselves across the globe but local social networks continue to play a huge role when it comes to brand awareness and customer outreach. Wealth management firms have still not fully exploited the benefits pertaining to their presence on social networks and are actively seeking more innovative ways to gain followers. Wealth managers, financial advisors and family offices have still not made significant progress in social media due to limited awareness, concern for data security, as well as the legal and reputational risks associated with the media.
Wikimedia CommonsPhoto: European Popular Party (Flickr: EPP Congress Marseille 7592) . Spain: Investors can get used to anything
Maxime Alimi, economist at Axa IM has published a report about Spain’s fiscal sustainability. Spanish fiscal sustainability remains in question. In the first part of his analysis, Maxime Alimi shows that Spanish real GDP growth in the coming ten years is likely to remain low, at about 1.3% on average. This is due to shrinking working-age population, a very gradual decline in the unemployment rate and modest improvements in productivity growth.
Investors seem to have now learned to live in Europe’s new normal: banking crises, political uncertainty and growth disappointments
“This is one lesson we have learned from three years (and counting) of the European sovereign crisis. While the first episodes of the crisis led to unprecedented stress in euro fixed income markets, investors seem to have now learned to live in Europe’s new normal: banking crises, political uncertainty and growth disappointments.
Still, this apparent resilience should not lead bond investors to lose perspective. At the end of the day, what matters is getting your money back, which implies picking solvent issuers. And while markets have calmed down, the fiscal position of most euro-area sovereigns is deteriorating, with budget deficits still large (although shrinking) and debt stocks increasing. Worse, the market’s silence has led to more complacency vis-à-vis deficits: the European Commission has recently approved a new fiscal trajectory for Portugal in 2013- 2015 and the European Semester should reveal similar leniency for Spain, France and the Netherlands, to name but three.
Spain has been at the center of investor concern and remains one large European issuer whose fiscal sustainability is rightly being called into question. This analysis attempts to shed some light on whether Spain will be able to stabilize and eventually lower its debt to GDP ratio over the next ten years.
Fiscal sustainability is a highly complex issue to address due to the large number of moving parts: projecting debt to GDP over time implies assumptions about real GDP growth, prices, primary deficits and interest rates paid. This being the case, the first part of our work will focus on just one element: real GDP growth…you can read the full report following this link.
International investment manager Henderson Global Investors has launched the Henderson High Yield Opportunities Fund (HYOAX, HYOCX, HYOIX), a mutual fund that seeks to obtain total return and current income by investing in high-yield bonds and select investment grade fixed-income securities.
The Fund will be managed by Henderson’s six-member US credit team, headed up by Kevin Loome. The team joined Henderson in February this year from Delaware Investments and this is the first fund to be developed for them. The team utilizes a fundamental credit research process and leverages a bottom-up security selection approach – emphasizing cash flow projections, total return potential and liquidity analysis – to create a diversified and focused portfolio of between 50 and 100 holdings.
While the Fund primarily invests in high-yield corporate bonds, up to 20 percent of the portfolio’s assets may be allocated to fixed- income securities rated investment grade. Those securities include US and non-US government securities, collateralized bond obligations and corporate bonds, with much as 25 percent of the Fund’s net assets invested in securities from foreign issuers.
“The combination of our investment approach, underpinned by fundamental and proprietary credit research, and our global team’s close collaboration allow us to construct a focused ‘best ideas’ portfolio of high-yield bonds and select investment-grade securities from issuers all over the world,” said Kevin Loome, Henderson’s Head of US Credit and the Fund’s Portfolio Manager. “At a time when interest rates are hovering at historic lows, Henderson is offering investors access to the most attractive high-yield securities from across the globe.”
Chuck Thompson, Director of US Retail, added, “This fund is a key addition to our fixed income fund line-up as it completes the credit spectrum and reinforces our dedication to provide our clients with products that are both global and truly differentiated. Henderson is now recognized as a global leader in both equities and fixed-income with an experienced credit team managing over $27bn in assets1”.
Advisors and investors can access more information about the Fund through the Henderson Global Funds interactive iPad app, which was launched earlier this year. It offers a deeper understanding of Henderson’s global products and investment expertise. The free app is part of Henderson’s broader strategy to connect with advisors and investors via YouTube, Twitter and Facebook, as well as the Henderson website.
The ING Global Opportunities strategy uses a thematic approach to identify attractive investment opportunities. The sub-theme ‘Big Data’ helps identify companies that will benefit from a growing global requirement to collect, organise, mine and analyse large and diverse datasets.
Data growth is exploding. Before 2003 mankind created 5 exabytes of data, now we generate 5 exabytes of data every 3 days. Decoding the human genome took 10 years before 2003 but now it can be achieved in one week. Wal-Mart handles more than 1 million customer transactions every hour with the equivalent amount of data as 167 times the books in America’s Library of Congress. Large amounts of data offer opportunities but putting it all together requires new IT solutions. Enter Big Data!
What is Big Data?
The benefits to a business of using its own data are frequently higher when addressing the variety of the data it collects as opposed to the volume. Unfortunately traditional data warehouses are not well-equipped to do this and certainly cannot handle modern unstructured data such as videos, images, texts and music. Fortunately, there is a new and on-going form of innovation within the IT sector that is permitting many organizations to deploy large amounts of complex data at a much faster rate and sophistication than previously was possible. This is what we call Big Data.
In practice Big Data has two main definitions. It usually refers to a special type of data: high volume, high speed and complex; or to a set of new technologies used to collect, organise, mine and analyse large and diverse datasets.
What is driving Big Data?
The real commercial treasure is considered to be the ability to analyse the large volumes of social content and related behaviour. Of course, in order to do this you would need to have the right kind of software and also a certain level of speed to ensure timely application of any business opportunities.
The benefits of combining large volumes of complex data with analytics and velocity are still yet to be discovered in some industries while in others they are already being implemented. In retail, for example, predictive big data analytics based on shopping habits have been around for a while.
Sub-theme within the Global Opportunities strategy
Leveraging Big Data will be a necessity for running the companies of the future. Adopting Big Data solutions could be like opening a treasure chest for many businesses. The ING Global Opportunities team seeks to identify the winners from this trend. Big Data is a sub-theme within the strategy’s ‘Digital Revolution’ investment theme, which is one of the seven main pillars of the team’s thematic approach to global investing.
To view the complete story, click the attached document above.
Wikimedia CommonsFoto: Pgecaj
. Howard-Sloan nombra a Alan Goldstein director de Wealth Management
Howard-Sloan, an executive search firm specializing in the placement of top tier executives for legal and financial practices, is pleased to announce the addition of Alan Goldstein. Mr. Goldstein will serve as the firm’s Global Practice Director of Wealth Management.
“It gives us great pleasure to welcome Alan to the Howard-Sloan team,” said Howard-Sloan CEO, Mitchell Berger. “Alan enters our firm with a multitude of knowledge about the wealth management sector and his extensive work with clients throughout the U.S., Latin America, Europe, Middle East and Asia will help Howard-Sloan expand its verticals both domestically and internationally.”
Goldstein comes to Howard-Sloan with over 20 years of experience in the industry. Through his role he will be concentrating on sectors including, but not limited to, private bankers and relationship managers, financial advisors, and private client investment management.
“I am delighted to join an organization as highly regarded as Howard-Sloan,” Goldstein stated. “The firm’s tremendous track record and success in legal and compliance recruitment dating back to 1957 speaks for itself. I look forward to contributing to the company’s wealth management division by pursuing additional verticals that will serve as a natural progression for Howard-Sloan’s well-established current practices, which include legal, compliance, accounting and IT.”
Goldstein reiterated that firms in the wealth management, family offices, asset management and hedge fund spaces should not hesitate reaching out to him regarding recruiting and hiring executive talent.
For over fifty years, Howard-Sloan Professional Search has specialized in the placement of legal, compliance executives, accountants and IT professionals worldwide. At Howard-Sloan, we are committed to providing the highest level of service to our clients and candidates. We conduct our business honestly, with the greatest sense of integrity
By Sandip Dey . BNY Mellon, galardonado como el "Mejor Proveedor de Servicios de ETFs" de las Américas
BNY Mellon, the global leader in investment management and investment services, has been named as the 2012 “Best Service Provider – The Americas” at the ninth annual Global ETF Awards, which is sponsored by exchangetradefunds.com. This is the seventh consecutive year that BNY Mellon has been honored as the top service provider to ETFs (exchanged-traded funds).
“We continue to enhance our industry-leading technology to support an ever-increasing array of ETF categories, including actively managed ETFs, commodity-linked ETFs and global ETFs,” said Joseph F. Keenan, managing director for BNY Mellon Asset Servicing and head of its global ETF services business. “We view this award as evidence of our passion for delivering the highest quality customer service to product sponsors.”
Since its inception in 1997, Exchangetradefunds.com has been providing information on global ETF, ETC and ETN products on its website. Information on the site consists of product descriptions, products listed on international exchanges, industry info and events, interviews from industry leaders and news. It is also the host of the ETF Global Awards® Dinner and Workshop. Its purpose is to recognize those who have contributed to the development of the ETF industry world-wide and welcomes industry participants from the international community to discuss their respective markets.
