Bristol opts for manager of manager approach

UK- The University of Bristol has put out to tender a manager of managers (MoM) mandate for its £100m (e158m) pension fund. The scheme is currently managed by Barclays Global Investors and Merrill Lynch IM.

Says William Lieuw, assistant finance director at the University: “the trustees have spent the last two years monitoring the scheme and weighing up the manager of managers approach, and now we have decided to change our investment manager strategy.

“A manager of managers approach may be more expensive but we believe that the benefits outweigh the costs – the performance of manager of managers feeds back through into the fund and covers the additional costs.”

The scheme is currently split between BGI and MLIM. BGI manages 45% of the fund on a passive basis, while MLIM manages 55% as an active mandate. Applications must be received by 11th November, and the scheme hopes to appoints a manager as soon as possible.

The MoM approach is becoming increasingly popular among smaller pension funds as it allows them access to specialist fund managers, which they would ordinarily not be able to afford, or to whom they would not normally have access.

A survey conducted by AIMMI, the Association for Institutional Multi-Manager Investing, this month revealed that the majority of UK senior investment consultants interviewed expected multi-managers to be managing between 16% and 30% of the pension fund market in five years’ time.

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