The implications of lower returns

Investment returns are set to be lower during the next two decades - with severe consequences for asset owners and managers. McKinsey outlines those for different types of institutional investors.

Investment returns are heading lower

Despite extraordinary highs and lows, returns were continually strong within the last 30 years, says McKinsey. However, US and European equity and bond returns are becoming weaker within the next two decades.

Four scenarios for financial advisory in 2030

Financial technologies have a massive impact on investment advisory. The Zurich University of Applied Sciences and the Zurich Banking Association have developed possible development scenarios.

Simplifying and speeding up fund selection

With the Digital Advisor, ifund and fundinfo launch a cloud-based tool for the selection of active and passive funds based on scientific criteria as well as investor preferences to reduce research and compliance costs.

Thematic investing in venture capital

During the past five years, venture capital has seen a rise in investment funds focussing on specific themes. Justin Caldbeck, the co-founder of Binary Capital, explains why this is beneficial for start-ups and funds.

Factor investing for institutional investors

Worldwide, more than 500 billion US-Dollar are invested in factor strategies. To investigate the motives behind the recently high inflows into the strategies, Invesco has surveyed institutional investors.

Boosting retention with native video advertising

Combining valuable content with a corporate message to differentiate a brand is a tough task but can have an enormous effect on customers. In a webinar, Yahoo shows best practice of making use of the innovative ad format.

Use Reddit to Increase the Impact of Your News

To have an impact, news and editorial coverage needs to be seen. Watch the recording of Business Wire’s webinar with Reddit on leveraging the 240 million active users and 45,000 communities on the social media platform.

Making impact investing the mainstream

Impact investing, generating social and environmental benefits while achieving financial returns, has attracted more than $77 billion in AuM. However, some changes are needed to allow further expansion, says McKinsey.

Excessive fees for funds

The British financial regulator FCA has examined the costs of investment funds. Due to high fees and lacking performance of active management, the regulator plans on enhancing transparency of investment goals and costs.

RCM launches Sustainability Momentum Fund

For 30 years, Raiffeisen Capital Management manages sustainability funds. Now, their product portfolio is expanded by a sustainability momentum fund that considers improvements in ESG factors when selecting shares.

Asset Managers increase Alternatives by 25%

After four years of growth, the AuM of the world’s 500 largest asset managers decrease by 1.7%. While investors’ portfolios remain similarly structured, alternative investments are on the rise.

altii with Content Link on Mr. Trump

After a most bitter and divisive U.S Presidential election, Donald Trump has won the U.S. Presidency. altii has composed a collection of market statements of numerous asset managers on the less predictable candidate.

Asset Manager not taking FinTech serious enough

A study from PwC shows that many asset and wealth manager are not considering FinTechs in their strategic decisions. However, neglecting innovative start-ups could lead to the loss of market shares.

Creating value with solar energy

The market for solar power is growing faster than ever but continues to lack profitability. Besides operational efficiency, an improved capital allocation is a key to success.

Disrupting real estate

According to EY, technology, demographics and globalisation are the three forces disrupting the real estate industry. While they threaten traditional business models, they also embed significant opportunities.

What are PRIIP KIDS?

The focus of PRIIP KIDs are future-oriented scenarios intended to give an impression of the opportunities and risks of a fund. fundinfo provides a user-friendly service to distribute the new document efficiently.

International Family Office Forum 2016

The Family Office Forum Zurich is the annual meeting of Family Offices and UHNWI from all over the world, a truly global gathering of Family Offices held in English. It is held by Prestel & Partner on 8-9 November 2016.

Mapping FinTech use cases

FinTechs are approaching complex front-, middle, and back-office tasks. Based on technological trends, EY and Innovate Finance categorise affected functions and identify grounds for collaboration.

How REIT markets differ

REITs have become a popular vehicle to invest in real estate. Global market capitalisation grew to about $1.5 trillion with US REITs growing by almost 150% since 2010 and non-US REITs doubling their market cap.

Investor confidence rises in September

State Street Global Exchange publishes the latest Investor Confidence Index results. Despite a more optimistic economic outlook, especially US investors remain risk averse.

Non-financial risks becoming a growing challenge

Tools and frameworks for the management of credit and market risks are well established. For financial institutions, McKinsey identifies a shifting focus towards non-financial risks that requires changes in banks’ practices.

Dependent asset managers recover

Since 2014, the fund subsidiaries of banks and insurance companies recorded high inflows while independent asset managers had to cope with lower inflows or even net outflows.

Investors overestimate themselves

Private investors are too confident of their knowledge and are thus making mistakes when investing money. A new study from Schroders shows that global demand for financial advisory still exists.

Promoting entrepreneurship for growth

Entrepreneurship can be a source of economic growth. With their Digital Entrepreneurship Barometer, EY assesses the G20 countries’ ecosystems and identifies best practice to enhance entrepreneurship.

New reality for family offices

Family offices have reduced their allocation to hedge funds by 10 percent within the last 12 months before May. A new study shows how family offices invest in illiquid assets and plan to cooperate.

Improving the VC capital structure

Venture capitalists raise funds from investors that expect to realise returns within eight to twelve years. But having a specific deadline may force VCs to rush into projects and exit prematurely, especially in emerging markets.

Institutional investors with knowledge gaps

In an Axa Investment Managers study, institutional investors certify themselves, at best, only a satisfactory knowledge about alternative debt. Asset managers should explain the topic with their years of experience.

Where portfolio managers earn most

The career portal efinancialcareers has analysed German asset manager and the German subsidiaries of internationally operating asset management companies. The ranking was completed by a survey among headhunters.

Value creating risk management

The better an insurer’s enterprise risk management, the better he performed during the financial crisis. McKinsey shows the elements of an effective framework that reduces volatility and improves capital performance.

Firms working on improving disclose effectiveness

Key stakeholders are requiring deeper insights into a company’s performance, strategy, governance, and risks. Surveying more than 120 executives, EY investigates, how corporations are improving their financial reports.

Changing the rules of portfolio construction

Asset allocation decision account to about 35 to 40 percent for the performance differences between funds. McKinsey finds that institutional investors are increasingly willing to rethinking their approaches and processes.

Four business models will survive

2015 was not an easy year for asset managers. Their performance was as bad as 2008, says the Boston Consulting Group in its annual study. Many asset managers must revise their business models accordingly.

Small- and Mid-Caps with optimised returns

Shares of small and medium-sized companies outperform those of large corporations. But higher returns can generally only be achieved by taking on an increased risk. A new study confirms the opposite for small companies.

Are asset managers causing volatility?

Ownership by large institutional investors can cause an increase in volatility. Research finds that through large trades, every 1% ownership by large asset managers causes an increase in volatility by 12 to 18 basis points.

10 drivers of change for asset managers

The asset and wealth management industry is being disrupted by FinTech start-ups. EY finds that this is just another challenge among regulation, technology, changing client demands and fiscal issues.

HFT reaching its limits

Increasing costs for infrastructure, tighter regulation and relentless competition erode profits from high frequency trading. The growth momentum seems to have reached its limits.

Reach German Journalists via Social Media

79 percent of German journalists use social media on a daily basis, says the latest Social Journalism study from Cision and the Canterbury Christ Church. This presents chances and challenges for public relations.

ETF assets to double by 2021

ETF assets could reach $7 trillion by the end of 2021. A new report published by PwC reveals that ETF assets will grow rapidly through entering new markets, expanding distribution channels and entering new asset classes.

European Commission to ease VC investments

The European Commission aims at increasing investments in small, medium and entrepreneurial companies. Doing so, the Commission proposes a change to venture capital regulations.

Risk management strategies need to be adjusted

Investors face lower returns and higher volatility. However, the current RiskMonitor survey from Allianz Global Investors shows: Investors have not changed their risk management since the financial crisis.

Chinese AM market to double by 2020

Despite lower economic growth and high volatility, the Chinese market remains attractive for asset managers. A strong economy, deregulation as well as product innovation drive the market’s expansion.

The power of blockchains

Simply put, blockchains are distributed databases build with open-source code. However, they could disrupt the financial services industry - or transform it, depending how the technology is approached.

What hinders ESG integration

Most institutional investors have realised that ESG criteria drive risks and returns and integrated them into their investment process. However, three problems seem prominent in integrating ESG integration.

Investors becoming less loyal clients

A study from EY reveals that four of ten clients are willing to switch their asset manager and investment advisor. Thereby, revenues of 200 billion USD could be moved to asset managers that position themselves best - especially regarding digital services.

Reducing counterparty risks when trading derivatives

Asset managers can benefit from the Registered Customer status for listed Eurex derivatives. With a straightforward implementation process, investors and traders can avoid the counterparty risk of their chosen clearing broker.

Geopolitical risk on the rise

The share of executives that perceive geopolitical instability as a major trend affecting their business has doubled within the last two years and have direct negative implication for corporate performance.

Rethinking hedge funds

The first quarter was the worst for hedge funds since the financial crisis. Many see the reasons for the bad performance in the funds’ structure. Fees have to be transformed and liquidity is a bigger issue for investors.

A changing landscape for venture capitalists

While nearly 150 private tech companies have achieved a valuation of more than one billion, their public counterparts have performed poorly. The landscape for investors has changed with firms staying private longer.

Consolidation in Real Estate Asset Management

The demand for a professional management of real estate is higher than ever, says a study from EY Real Estate and Triuva. However, many expect a further consolidation of the industry as complexity and costs rise.

Positive Outlook for Precious Metals

Gold has performed better in times of negative real interest rates than in times of not-negative rates. For other, more industrially used precious metals, ETF Securities sees positive price signals too.

The changing outlook for industrial metals

Industrial metals are enjoying a renaissance. ETF Securities invites together with Bloomberg Intelligence to join their webinar on May 25 about the improved outlook as well as the drivers and implications of it.

For how long remains London the FinTech center?

UK start-ups profit from an abundance of tech talents, regulation and London’s financial infrastructure. While they received more money than all continental European FinTechs, London’s role as a hub is threatened.

How volatile are stock markets really?

Many quote that markets are too volatile for some investors in order to make a case for their products. However, while short-term measures of volatile fluctuate, long-term volatility has been very stable.

Attractive spreads in emerging market debt

Emerging markets have proven their economic and financial resilience. Attractive spreads and a lower volatility than US high yields make emerging market debt attractive. Further support comes from global trends.

Long-term investment returns likely to decrease

After three decades of exceptionally high returns, performance drivers are likely to weaken or even reverse, says McKinsey. Investors should prepare themselves for decreasing returns over the next 20 years.

Only small improvements in sustainability

In their yearly study, Oekom-Reserach has analysed 1600 internationally active companies in regards to their sustainability. Only 16.3 percent of companies achieve the “prime status” in the evaluation.

Delaying rate increase: A mistake of the Fed?

After the US central bank has increased interest rates for the first time in nine years, further rate raises during the year have been postponed. With increasing inflation, this might require more aggressive intervention, says ETF Securities.

Huge outflows from hedge funds

Due to high fees and weak performance, many investors are withdrawing their money from hedge funds. Assets under management have decreased by 15 billion to 2.68 trillion Dollar during the first quarter.

Insurers expand asset management

Insurance companies suffer under cost extensive regulation, low interest rates and demographic changes. Due to increasing cost pressure, insurers want to expand their asset management to boost group profits.

Too much money, not enough investments

Real estate prices are booming and in times of volatile share markets and low to negative bond returns, real estate funds are increasingly in demand. The run for real assets forces some asset managers to stop accepting new investments.

Smart beta increasingly used by institutional investors

In a survey, the asset management firm Source examines that smart beta strategies are increasingly used by institutional investors. 27 percent are already invested in these products and 31 percent of the remaining are planning to do so.

Doing well by doing good - the computer can

Investors don’t want to be patronised with moral arguments but are to be convinced of sustainable investing by improved returns. Algorithms such as those used at Arabesque know, how to use ESG-factors profitable.

Investors want tighter risk controls in hedge funds

Hedge fund managers need to distinguish themselves from the rest of the market to attract investors that become increasingly concerned about clear investment processes and tighter control over assets managed.

Improving the presentation of financial data

In today’s multimedia world, information is no longer just published in texts but much more often using additional visual elements. Presenting financial data graphically increases engagement, entertainment and retention, shows a new study.

Where energy markets stop making sense

The world fights climate change and reduces greenhouse gas emissions. Renewables could tripple their market share by 2040 but the majority of electricity is still produced using coal and gas. Neither does nuclear power seem an option.

Academics don’t want to work in Finance

A while ago, becoming a banker was an attractive career choice. In a study pursued by the University of Maastricht and Studitemps, banking underperforms other industries in seven of ten criteria regarding the attractiveness for students.

Scale and specialisation

ETFs are gaining larger market shares, not only but also because they cheaper than actively managed funds. Are traditional asset managers now facing their ends? No, says the Boston Consulting Group in a new study.

Concentrate at what your best at

For venture capital investments, concentration to what one knows is an important factor. The venture capital arm of Intel plans on selling about a fourth of its portfolio companies. A sale that could be worth about $1 billion.

Active asset manager in cost trap

For quite some time, banks have to suffer under increasing costs from regulation. Those may now effect asset managers too, says a recently published study from Oliver Wyman and Morgan Stanley.

“Sustainable, profitable and little risk”

The sustainability topic remains interesting for investors. Studies show that sustainable corporate strategies are beneficial for the performance on stock markets. Especially passive products are successful in this area.

How disruptive is today’s FinTech?

Over many years, the financial services industry could not be changed. While many businesses were disrupted in and since the dot-com bubble, finance stayed the same. But one may ask, if today’s FinTech players are different.

A new generation of infrastructure investments

The world’s nations have committed themselves to the reduce carbon emissions. To do so, sustainable infrastructure is needed. To allow for more private investments, McKinsey says that some barriers have to be lifted.

New challenges and opportunities for CCOs

Ernst & Young has asked Chief Compliance Officers from 20 global insurance companies. Many say, the compliance function has changed drastically while upcoming changes are still to come. Seven key themes strike out.

Webinar: Is there still value in Gold?

Due to concern about the banking system, a potential Brexit and many other themes, a resurgent interest in gold could be observed. On March 17, ETF Securities invites you to join the webinar on the prospects of the precious metal.

What drives FinTech adoption?

Driven by innovative start-ups and major technology corporations, FinTech companies are capturing larger market shares of the financial services market. EY investigates the reasons that make customers switch to the new type of player.

Time to reconsider emerging market fixed income?

ETF Securities and Lombard Odier Investment Managers invite you to their webinar on the impact of divergence within emerging market, global deflation and falling currencies in regards to their potential investment opportunities.

The future of financial computing

Quantum computers were once thought an impossible technology as they harness the power of quantum mechanics and are housed in unconventional environments. Now they are able to solve important problems in all kids of industries.

Top Asset Manager lack SRI integration

The biggest asset managers have, with few exceptions, much room for improvement regarding the integration of SRI criteria in their investment processes, says a survey pursued by the Handelsblatt.

Venture Capital funds in troubled water?

US venture capital firms have raised $28.2 billion in 235 funds during the year 2015. Thereby, both measures have fallen: Fundraising is 9% down and the number of funds decreased by 36.

Family Office Forum Wiesbaden

The Family Office Forum hosted by Prestel & Partner is taking place April 26th and 27th. More than 160 family offices, UHNWI and experts will network and exchange knowledge on the event.

How intelligent is Smart-Beta

Smart beta ETFs are said to be corrupting the basic ideas of ETFs to establish a simple and cost efficient access to capital markets. Checking the facts about the criticism on this more and more attractive product category.

Identifying outperforms repeatedly?

Responsible investing helps to identify companies that are more likely to outperform. “A quantitative approach that removes subjectivity has the advantage of making alpha generation in a repeatable process,” says Rohini Rathour.

Was 2015 the peak of the VC cycle?

In 2015, European start-up funding has hit a new record with 12.9 Billion Euro but the number of rounds closed went down by about 30%. A sign that VC investors are up for saver bets?

Hedge funds with net outflows in Q4

For the first time since 2011, investors have pulled more money out of hedge funds than they invested. Still, the industry’s AuM rose as performance gains outweigh investor’s withdrawals. Especially big funds were successful in 2015.

China in 2016

Fears about China’s economic conditions made global share markets plunge at the beginning of this year. Still, some key trends provide investors with opportunities in this increasingly diverse and volatile $11-trillion economy.

Quants are the new ethical investors

Investment strategies integrating ESG factors were typically strategies that included a lot of quantitative research and subjective judgements. New investors are now using quantitative approaches to invest responsible.

Absolute return funds struggling

Low interest rates and volatile share markets drive investors into absolute return funds. An analysis of e-fundresearch.com says that only half of these funds have generated positive return during the past year.

Family Office Forum Dubai

Prestel & Partner invites to the Family Office Forum on 16th and 17th February in Dubai. On the event for MENA based family offices, more than 100 family offices, principals and CIOs meet.

Fewer hedge funds for European investors

For small and new hedge funds in Europe, 2015 has been a devastating year. Increasing costs as well as lower fees generated have forced some asset managers out of business and let to a decrease in the number of funds.

Asset Managers with strong ETF business on top

Asset managers including Vanguard and BlackRock were very successful in 2015 and have received the highest inflows during that year. Some other asset managers had to face serious outflows.

The rise of electronic platforms

Electronic platforms are becoming a vital channel for global funds distribution. While those are not new to the financial industry, EY claims that asset managers have just been the slowest to adapt.