All articles by Rachel Fixsen – Page 203
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Features
Cash increases your options
Increasingly, pension funds in Europe are seeking better ways of managing their cash. Peter Eerdmans, senior investment consultant at Watson Wyatt in London, sees two main reasons for this focus. Cash is carried within the fund, for instance by an equities manager who has not invested it, and this may ...
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Features
No longer plain cooking
Dutch pension fund giant PGGM does not hold cash as a strategic asset class. However the fund holds a substantial cash position, says Marc Nuijten, head of treasury and overlay management at the Dutch pension fund. “This is partly due to the fact that the fund has an allocation to ...
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Mushrooming demand
Demand for currency management and overlay has ballooned in the last two years as investors embrace it as an alterative source of return. As currency managers tune their services to the needs of pension funds and other institutions, the future of the sector is beginning to take shape. Currency overlay ...
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Features
Risk-controlled repos
With repos, or securities repurchase agreements, many larger pension funds can lend directly, dispensing with the expense of money market fund manager fees altogether. The problem of dealing with the collateral exchanged in the repos process can be a hurdle, but this can be outsourced, says Bank of New York ...
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Features
Residual or strategic?
Large amounts of pension fund cash are held in current accounts: it is estimated that 40% of all cash is held this way. But money market fund providers say there is a better way. Putting the cash in funds not only generates better returns, but also improves credit security. Money ...
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Features
Bandwagon begins to roll
Pension funds in Europe have been stepping up their use of external currency managers. Bill Muysken, global head of research at Mercer Investment Consulting in London, says there has been a rise in the number of pension funds seeking external currency managers. During 2004, he says, 28 of Mercer’s clients ...
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Features
Diversification key strategy
Starting anything with a clean slate has an obvious appeal. On this principle, many pension funds choose to do away with the risk of currency fluctuations within their overall portfolio before attempting, separately, to add value through active currency management. Dutch pension fund PGGM says that from an asset liability ...
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Europe following US example
There has been huge growth in the demand for currency management over the last two years, managers report. Institutional investors are seeking both to reduce the risk of foreign exchange fluctuations while at the same time making the most of the opportunities for profit. Currency can be managed through a ...
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Features
Are one-stop shops feasible?
Firms that offer multi-management investment services can save pension funds a great deal of administrative hassle – they provide the client with a layer of diversification without them having to deal with a large number of individual fund managers. And some multi-managers in Europe are now going a step further. ...
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Features
Freeing up managers
Pension funds are increasingly considering investing in currency hedge funds instead of using a currency overlay programme. Emmanuel Acar, head of London Risk Management Advisory at Bank of America, says this is one of the trends emerging in the currency management sphere. “Pension funds are now considering allocating to currency ...
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Features
The great alpha hunt
Europe’s pension funds are still reluctant to talk about their strategies in terms of alpha and beta. But there is still a need for pension funds and other large investors to gather all the outperformance that they can. The terms ‘alpha’ and ‘beta’ are used to name two investment management ...
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Features
Best and worst of both worlds?
For all the benefits enhanced indexing may offer – close index tracking with vital extra points of performance – the depth of its acceptance varies from country to country within Europe. Frits Bosch, director of Netherlands consultancy Bureau Bosch, says enhanced indexing is very popular among pension funds in his ...
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Features
Cleaning up with enhanced
Among the UK pension funds that moved into enhanced index equities last year was the £550m (e792m) fund belonging to household cleaning products company Reckitt Benckiser UK. The fund awarded State Street Global Advisors a £50m enhanced indexing equity mandate. The fund’s manager Kevin O’Berg said State Street was chosen ...
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Eking out extra returns
Melissa Brown, managing director and senior portfolio manager of the quantitative equity group at Goldman Sachs Asset Management (GSAM), says there has been a lot of interest among pension funds in many different markets for enhanced indexation products in the last year or so. She cites several reasons for the ...
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Features
Reclaiming what is yours
Are brokerage commissions on securities transactions too high? Pension fund managers in Europe, who believe they are paying too much for transactions, are now more aware that there is something they can do about it. Setting up a commission recapture programme can rebate considerable sums in commission paid. Russell Investment ...
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Features
Actuaries past sell-by date?
Across Europe, demand for actuarial services has ballooned as corporations and their pension funds struggle to comply with new regulations and accounting standards. In some areas, there are now signs that the peak is past, but how has the industry coped with the call on its skills? Malcolm Campbell, vice ...
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Features
Hedge funds by another name
According to Mercer’s study of UK pension fund asset allocation, tactical asset allocation (TAA) is also anticipated to become more popular, with the proportion of schemes using TAA expected to rise from 3% in 2004 to as much as 10% this year. David Tucker, of the UK arm of Australian ...
