Photo: Elias Gayles. Lombard Odier and ETF Securities to Join Forces in Fixed Income ETF Offering
Lombard Odier Investment Managers and ETF Securities have announced their cooperation offering a range of Ucits compliant fixed income ETFs.
Lombard Odier, which traditionally offered traditional fixed income funds, will now offer smart beta fixed income products via asset managers, financial advisors and investment platforms. The ETF’s will be listed on London Stock Exchange as of mid-April and will be available to both, retail and institutional investors.
Mark Weeks, CEO of ETF securities comments: “This dynamic partnership is based on complementary skills and experience of two market leaders. Distributing Lombard Odier IM’s fundamental fixed income strategies via ETFs offers an innovating smart beta solution for fixed income investors and helps us to build our reputation as pioneer in specialised investment solutions.”
. Old Mutual Global Investors Successfully Held its First Investment Conference in Latin America
Last week, Old Mutual Global Investors held a successful event in Punta del Este, Uruguay, bringing together over 70 Latin American investors from Uruguay, Argentina, Chile, Colombia and Mexico.
Through this event, Old Mutual Global Investors wished to share with clients their views on investment trends and current opportunities, as well as developments in its management and business development teams in the Americas region. The team led by Chris Stapleton, which, working from Boston, is responsible for the distribution business in the Americas, was present in Uruguay in its entirety with a clear message: Latin America is a priority for Old Mutual Global Investors, and this event, which just celebrated its first edition, is destined to be repeated every year.
Veronica Rey, Regional Director of the Southern Cone, acted as Emcee throughout the event introducing the various directors and portfolio managers who discussed the firm’s strategy and market vision. Also present were Andrés Munho, who, based in Miami, is Regional Director for Florida, Texas, and northern Latin America, and Santiago Sacias, who works as Southern Cone Sales and, like Veronica Rey, is based in Montevideo.
Old Mutual Global Investors (OMGI) is part of Old Mutual, an international financial group founded in 1845 which is part of the FTSE 100. OMGI closed 2014 with more than 34 billion dollars under management and 70% of its funds positioned in the first quartile of their respective categories. This asset management company has investment offices in London, Boston, and Hong Kong.
During the conference’s inaugural speech, Allan MacLeod, Head of International Distribution for the company, emphasized that OMGI has won over 30 industry awards since 2013, including the prestigious recognition as Global Group of the Year at the 2014 edition of the Fund Manager of the Year awards granted by Investment Week magazine.
The investment professionals attending the event were Christine Johnson, Portfolio Manager and Fixed Income Specialist, Amadeo Alentorn, Fund Manager and Head of Global Equity Research, Josh Crabb, Head of Asian Equities, and Natalia Fontecha, SVP and American Equity Product Specialist at Old Mutual US.
Each of these four experts gave presentations in which they discussed the prospects of their asset classes, as well as participating in a panel moderated by Michele Santo, renowned Uruguayan economist specializing in international economics who, besides being a consultant at the Inter-American Development Bank, currently serves as portfolio manager for OM Global Investment Portfolios in Uruguay. The four experts in the panel talked about monetary policy, inflation, and growth in the current environment of increasing volatility in the markets.
The event also featured a special presentation by Chris Gardner, author of the New York Times’ No. 1 bestseller “The Pursuit of Happyness,” an autobiography published in 2006 which was translated into 40 languages, and brought to the screen with the same name in an acclaimed film in which the actor Will Smith plays Gardner, a role for which he won a Golden Globe Award and nominations to the Screen Actors’ Guild Awards and The Academy Awards, or Oscars.
The event, which took place over the 19th and 20th of March, also provided numerous occasions for the guests to enjoy Uruguayan cuisine in a relaxed atmosphere conducive for networking.
You may see photos of the event in the attached video.
CC-BY-SA-2.0, FlickrPhoto: A Guy Taking Pictures. Morningstar: 2014 Was A Difficult Year for PIMCO; Vanguard Still Thriving
Indexing pioneer John Bogle’s company, The Vanguard Group, has grown into a global giant with almost $3 trillion in assets; it is the largest provider of mutual funds and the second-largest provider of exchange- traded products in the world. With a wide variety of accessible investment options, the ability to capitalize on economies of scale, and a philosophy of passing the results of efficient operations to its investors in the form of lower costs, Vanguard has built a solid reputation and continues to attract the highest flows.
In addition to its strong expertise in passively-managed investments, Vanguard has also managed to grow its business on the active side. As of the end of 2014, Vanguard was the third-largest active fund manager in the world, with active assets exceeding $900 billion.
On Sept. 26, 2014, “bond king” Bill Gross announced his decision to leave PIMCO, the asset management company he co-founded, sending a shockwave throughout the investment world and prompting unprecedented outflows from PIMCO in the days following his departure.
PIMCO experienced outflows of $176 billion worldwide in 2014, or 26% of their 2013 assets. Outflows from PIMCO Total Return amounted to $96.1 billion in the space of only five months.
Outflows from PIMCO benefited other funds in the intermediate-term bond category. TCW enjoyed consistent inflows to Metropolitan West Total Return Bond MWTIX, which has a Morningstar Analyst RatingTM of Gold, and Gold-rated Dodge & Cox Income DODIX attracted significant amounts of investor money for Dodge & Cox.
BlackRock and iShares combined (they are really the same company) turn out to be the world’s third-largest fund asset manager after Vanguard and Fidelity, with a total of $1,862 billion in assets. They were able to produce organic growth rates above 10% on both the active (BlackRock) and passive (iShares) sides of their business.
. Old Mutual Global Investors Adds Emerging Market Debt to Its Skill Set
Old Mutual Global Investors is pleased to announce the appointment of John Peta as Head of Emerging Market Debt. John joined the business on 2 March 2015 and reports to Christine Johnson, Head of Fixed Income.
Old Mutual Global Investors believes that John brings a wealth of industry knowledge and experience to the business. John previously worked at Threadneedle Asset Management, London where he was Fund Manager, Head of Emerging Market Debt since 2012. John started his career in Fixed Income in 1987 at Merrill Lynch, Seattle, before joining Chancellor LGT Asset Management, San Francisco in 1994. John began specialising in managing dedicated emerging market (external and local) debt assets when he joined Standish Mellon Asset Management, Boston in 1997, moving to Acadian Asset Management, Boston in 2007 to assist in the launch of an emerging market local currency debt product.
John will initially manage the US$150 million¹ Old Mutual Local Currency Emerging Market Debt Fund with effect from 20 April 2015. The business will review the manager of the US$250 million¹ Old Mutual Emerging Market Debt Fund and may announce any recommended change at a later date. Both funds are sub-funds of the Dublin domiciled Old Mutual Global Investors Series plc and are currently sub-advised by Stone Harbor Investment Partners LP.
Christine Johnson, Head of Fixed Income, comments: “We are delighted that John has joined us as his wealth of fixed income and emerging market debt knowledge will greatly enhance our investment capabilities. We believe that our clients will also benefit from John’s investment skills. Whilst we are looking forward to working with John, we would like to take this opportunity to thank Stone Harbor for their support in managing the Old Mutual Local Currency Emerging Market Debt Fund and for continuing to work with us on our hard currency fund, the Old Mutual Emerging Market Debt fund.”
Old Mutual Global Investors aspires to be a leading, modern asset management business focused on the needs of investors. Significant progress has been made to further the goal of being a top five player in the UK retail market. The business has restructured its global business and now has a strong distribution capability spanning Asia, Europe and Latin America, which currently generates 20% of revenues from outside the UK.
Old Mutual Global Investors is an investment focused business which strives to provide the very best investment talent and performance to clients. The business plans to grow its market share through investing in existing core investment skills and expanding capabilities where they are complementary to the business’s culture and focus.
Julian Ide, CEO of Old Mutual Global Investors, added: “From the outset, we have retained and attracted the best investment talent offering: compelling and reputable investment processes and track records; ‘star’ quality; strong cultural fit within the business and incremental distribution benefits. In addition to enhancing our distribution capability, we have bolstered our Equities team with the appointment Richard Buxton and his team, including Ian Ormiston as European Smaller Companies Fund Manager, launched our Asian Equities capabilities with the appointment of a team of four under the leadership of Josh Crabb and, more recently, announced that Russ Oxley and his team of six will join us during the course of this year to form our Fixed Income Absolute Return team.
“I believe that John’s appointment is further proof that Old Mutual Global Investors is a sought after destination for top investment talent. The addition of his expertise certainly enhances the range of products we can offer to our global client base and we are now seeking to bolster this investment capability by recruiting additional resource.”
Photos: Pablo Blázquez. Funds Society Successfully Held the Second Edition of its Golf Tournament
The 2nd Funds Society Golf Tournament was held on Friday March 13th at the Miami Beach Golf Course, the tournament was attended by over 50 participants from the Asset and Wealth Management Industry in South Florida. On this occasion, we enjoyed the cooperation of Henderson Global Investors, MFS, M&G and Carmignac.
Although it seemed that the weather would be on our side this year, players had to contend with several of those storms so typical of Miami, bravely continuing with the game in spite of being soaked to the bone. Of course, no one gave up and all attendees continued the tournament, claiming that they were enjoying “a great day of golf.”
The session of golf was preceded by a panel in which each manager had the opportunity of sharing their strategy and prospects for 2015. Nicolo Carpaneda, fixed income specialist at M&G, reviewed the main triggers of the global debt market. Meanwhile, Malte Heininger, who manages Carmignac Euro-Entrepreneurs, a fund oriented towards small European companies, detailed the opportunities in European equities. Nicholas J. Paul, Director of Investment Products at MFS spoke about the attractiveness of emerging equities in the current macro environment. Asian markets were covered by Andrew Gillan, portfolio manager for the Asian Equity team (ex -Japan) at Henderson Global Investors.
After lunch, the championship’s shotgun start came at 13:30. As was the case last year, the game type was individual Stableford in two categories. The first category was for players with handicap 0 to 18.4 and the second for those with an 18.5 to 36 handicap.
Following is the list of Winners of the 2ndFunds Society Golf Tournament:
Flight 1:
1st Place – Luis Cardenas – Sabadell Bank, Miami Branch
2nd Place – Ignacio de la Maza – Henderson Global Investors
Flight 2:
1st Place – José Alfredo Ruiz Marcos – Agent
2nd Place – Carlos del Hierro – Sabadell Bank, Miami Branch
Photo: Droid Gingerbread. Man Group Expands Quant Range with Launch of Man Numeric UCITS Funds
Man Group has expanded its range of quantitative investment vehicles with the launch of two UCITS-compliant equity funds managed by Man Numeric, the Boston-based quantitative manager acquired by Man Group in September 2014.
Domiciled in Dublin, the Man Numeric Market Neutral Alternative fund and the Man Numeric Emerging Markets Equity fund are the first UCITS vehicles to be offered to the European market by the US fund manager, which has $16.7bn of assets under management (as of 31 December 2014).
The Man Numeric Market Neutral Alternative fund offers investors exposure to one of Man Numeric’s core strategies, the Numeric Alternative Market Neutral Strategy , which launched in 2001. The highly liquid strategy aims to provide consistent, low volatility performance uncorrelated to market indices and other quantitative vehicles.
Overseen by Man Numeric’s co-heads of hedge fund strategies Greg Bond and Daniel Taylor, the strategy uses a variety of models to deliver returns, broadly combining its value driven bottom-up stock selection process with a fundamental statistical arbitrage model. Using long and short strategies to express their views, the investment team seeks unique sources of alpha from a universe of more than 9,000 stocks globally, with holding periods ranging from around four weeks to a year.
Portfolio risk is carefully monitored and spread across the range of different investment strategies, with the strategy having delivered consistent performance over the long term with low volatility.
The Man Numeric Emerging Markets Equity fund is based on the Numeric Emerging Markets Core Strategy, which launched in June 2013. Aiming to outperform the MSCI Emerging Markets Index, the strategy is managed with a focus on quantitative, bottom-up stock selection via a systematic and disciplined process.
Attractive stocks are identified using two primary selection criteria – valuation and information flow – with a range of models within these groups identifying pockets of market inefficiency. Portfolio construction and risk management attempt to maximise alpha while minimising exposure to economic risk.
Portfolio managers Ori Ben-Akiva, Greg Bunimovich and Mickael Nouvellon provide oversight by evaluating all trades for data accuracy, as well as news flow and special circumstances.
The Man Numeric Emerging Markets Equity fund has been passported across Europe, while the Man Numeric Market Neutral Alternative fund is currently pending approval in nine countries including Switzerland, Austria and Germany.
Michael Even, President and CEO of Man Numeric said: “We are delighted to launch these UCITS-compliant funds, offering investors in the European market access to two of our core alpha-generating strategies for the first time. These launches have been made possible by becoming part of Man Group, enabling us to leverage the firm’s resources and expertise to reach an investor base we would not otherwise have been able to.”
Man Group acquired Numeric in September 2014, and together with Man AHL this created a diversified, global quantitative investment platform which offers clients a broad product range across alternative and long-only, trend following, technical and fundamental strategies.
Foto: Laurent Ducoin, new head of European equities at Amundi. Amundi Hires Laurent Ducoin as Head of European Equities
French asset management group Amundi has appointed Laurent Ducoin as head of European equities.
Formerly, Ducoin was head of European Equity team and fund manager at Carmignac from 2011 where he was responsible for rebuilding the investment process of the team.
Prior to that, he worked at BlackRock in London from 2004, where he became fund manager and participated to the management of several pan-European and Swiss only-products.
Ducoin began his career in 2000 at Oddo Pinatton Equities where he worked as a sell side financial analyst before holding the same position from 2002 to 2004 at CM-CIC Securities.
Amundi manages over €850bn of assets worldwide as at 31 December 2014 and is located in more than 30 countries.
Photo: Robert Huffstutter. China's Next Gen Consumers
The “Post-90s” generation, comprising those born in the 1990s, has emerged as China’s newest generation of consumers. Representing 15% of the total population and now in their 20s or entering their 20s, this segment of China’s young are embarking on their first jobs and even starting families of their own. While they do not yet have the purchasing power of older generations, they have already influenced how brands approach product development and marketing.
This generation was born amid the restrictions of China’s one child policy, which in many cases means that they have had a fairly comfortable upbringing, and did not have to split family resources with siblings. They were also raised among a macroeconomic backdrop of rapid GDP growth and wage increase. As a result, compared to China’s older generations, the Post-90s children tend to feel more optimistic about their futures and less inclined to save. In fact, they have often been described as “happy and confident spenders.”
The Post-90s generation also grew up with the Internet. While this is not unique to China, what is different is that as Chinese consumers they simultaneously witnessed an explosion of new brands. This younger set embraced the opportunity to gather information online and thus, has also become a more sophisticated group of consumers; often, they can look beyond a brand to make a more holistic decision, using online resources and reviews, to inform their purchases, considering features, quality and prices.
Express individuality
Most interestingly, the Post-90s group seizes opportunity to express their individuality. They view each product as an extension of their personal identity and a chance for self-expression. They are interested in the personality of a brand and the story behind a product—and consider it even better if they can engage in a dialogue with the brand or collaborate in the development of the product.
Some brands are ahead of the curve in understanding and appealing to this generation. For example, the Coca-Cola Company went as far as implementing a successful campaign to replace its iconic brand logos on bottles with online nicknames popular among the Post-90s generation, status updates used in social media, or lyrics from popular songs.
In another notable example, private smartphone manufacturer, Xiaomi, chose a collaborative approach to product development, making a concerted effort to consider and implement user feedback. This philosophy has resonated well with the Post-90s generation of those becoming more engaged and loyal customers, and who feel a connection with a brand and product that is tailored for their needs.
Most firms, however, are still grappling to discover what will resonate with this new generation of consumers. As the Post-90 generation grows to become China’s main consumer base, it will be important for brands to innovate and evolve along the way in order to prosper over the long term.
Opinion column by Hayley Chan, financial Analyst at Matthews Asia.
The views and information discussed represent opinion and an assessment of market conditions at a specific point in time that are subject to change. It should not be relied upon as a recommendation to buy and sell particular securities or markets in general. The subject matter contained herein has been derived from several sources believed to be reliable and accurate at the time of compilation. Matthews International Capital Management, LLC does not accept any liability for losses either direct or consequential caused by the use of this information. Investing in international and emerging markets may involve additional risks, such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation. In addition, single-country funds may be subject to a higher degree of market risk than diversified funds because of concentration in a specific geographic location. Investing in small- and mid-size companies is more risky than investing in large companies, as they may be more volatile and less liquid than large companies. This document has not been reviewed or approved by any regulatory body.
Morningstar reported this week estimated U.S. mutual fund and exchange-traded fund (ETF) asset flows for February 2015. Positive economic indicators and a six percent gain for the S&P 500 during the month renewed investor confidence in stocks, but once again, it was passively managed international- and U.S.-equity funds that reaped the rewards.
Morningstar estimates net flow for mutual funds by computing the change in assets not explained by the performance of the fund and net flow for ETFs by computing the change in shares outstanding.
Additional highlights from Morningstar’s report about U.S. asset flows in February:
Taxable-bond funds collected approximately $28.5 billion in February, their largest monthly inflows since January 2013. The fixed-income category with the greatest inflows was high-yield bond, which tends to do well in a rising interest-rate environment. Utilities funds had the largest February outflows.
Vanguard continued to dominate inflows among passive providers and took the lead among active providers in February. Also on the active side, J.P. Morgan remained the top provider in terms of one-year inflows.
Another month of redemptions brought PIMCO’s total losses to $174.9 billion since January 2014, a decrease in assets of 33 percent. In the six months since PIMCO co-founder Bill Gross’ departure, PIMCO Total Return, which has a Morningstar Analyst Rating of Bronze, has shed $99.4 billion.
Outflows from PIMCO continued to benefit other intermediate-term bond funds. TCW and Dodge & Cox have enjoyed consistent inflows to Metropolitan West Total Return Bond and Dodge & Cox Income, respectively, which both have Gold Analyst Ratings.
Photo: BTC Keychain. Bitcoin Users To Approach Five Million by 2019
A new report from Juniper Research has found that the number of active Bitcoin users worldwide will reach 4.7 million by the end of 2019, up from just over 1.3 million last year.
However, the report, ‘The Future of Cryptocurrency: Bitcoin & Altcoin Impact & Opportunities 2015-2019’ argues that usage will be continue to be dominated by exchange trading, with retail adoption largely restricted to relatively niche demographics.
Retail Activity “Extremely Low”
According to the report, while a number of high profile retailers are enabling Bitcoin payment, activity levels from both online and offline deployments are extremely low. As report author Dr Windsor Holden observed, “While average daily transaction volumes have increased by around 50% since March 2014, the indications are that much of this growth results from higher transaction levels by established users rather from any substantial uplift in consumer adoption.”
The report cited a number of factors which it claimed would continue to inhibit growth, most notably the difficulty in communicating the concept of cryptocurrency payments to end users. It also argued that Bitcoin’s historical association with – and continued use by – criminals for illegal purchases and money laundering was likely to act as a further deterrent to mass adoption.
Supply Side Challenge
Meanwhile, the report observed that with many Bitcoins being hoarded by early speculators, currency supply could be further restricted with Bitcoin mining profitability threatened by a combination of the cryptocurrency’s volatility, lower Bitcoin yields and rising electricity costs.
Other findings from the report include:
The introduction of licensed, regulated exchanges could lead to a stabilisation in currency values and with it an increase in retail transaction adoption
The protocols behind cryptocurrency could be deployed in areas such as real-time transactional settlement
The altcoin market continues to be plagued by “pump and dump” currencies created solely as short-term investment vehicles
