Watson Wyatt publishes notional portfolio data

UK - Watson Wyatt has released the results a “notional” portfolio – to show how institutional investors might have performed if they had placed assets with investment managers that Watson Wyatt recommended.

Nick Watts, European head of investment consulting at Watson Wyatt, said: "We have been running notional portfolios of managers internally for three years in order to monitor the quality of our manager research and selection.

“We are publishing the findings now as part of a move towards greater transparency in line with trends in the industry.”

It will not be releasing any names of the underlying managers.

It said its method is the appropriate way to reflect added value through manager research - each “Model Portfolio” consists of Watson Wyatt's preferred manager line-up for that asset class.

The performance data was verified by Deloitte & Touche. It covers thirteen asset classes in most major equity and bond markets around the world. The firm will publish the data annually.

Over the three-year period since the portfolios were set up, all 13 outperformed their benchmark - before transition costs and fees, Watson said. After fees and transition costs, only the notional emerging markets equity portfolio underperformed.

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