There has been a dramatic rise, globally, in the number of companies searching for investment managers with Australia, the UK and Europe all experiencing significant increases. This, according to the latest Mercer report on global investment manager search trends, is a turnaround from the depressed levels seen in 2008. Global/international equity remains the dominant search activity, reflecting a continuing trend towards globalising equity exposures.
Andy Barber, Global Head of Manager Research, Mercer commented, “The decline in domestic equity allocations and increase in global equity searches highlights a continuing trend towards a more global approach to equity management.”
In contrast, despite assets placed slightly increasing from around US$17 billion to US$19 from 2008 to 2009, search activity in Asia has declined by a third from 60 to 40 during the same period. Across the region, interest in higher-return areas such as private equity and fund of hedge funds has reduced from previous years. Marianne Feeley, Principal, Asiapac Manager Research Team, Mercer explained, “Search activity across Asia remained muted last year as investors waited for the financial storm to clear. Searches were mainly limited to switching, with no new net injection of funds into the capital markets.”
The most dramatic increase in search activity was witnessed in Australia, which saw a 100% rise in 2009 from that in 2008. The amount of assets placed actually decreased from around US$15 billion to just under US$8 billion, reflecting a trend for smaller placements. Equity searches dominated, with Australian equity increasing from 18 to 24 and global equity from 12 to 23. Feeley added, “The equity search activity in Australia can be attributed to manager underperformance, a change of ratings and investors seeking products with lower fees.”
Paul Arkwright
Publisher
