Investors searching for a safe alternative
Market turmoil is making investors more adventurous, with increasing numbers looking at alternative assets, a new report by Mercer on global investment manager search trends has found.
Mercer’s 2007 Manager Search Trends Report, based on information garnered from the fund manager’s global database of institutional clients, found uncertainty in global financial markets has led to a sharp increase in investor searches for managers of alternative assets.
According to the report, searches in alternatives are up by about 20 per cent worldwide. However, global equities and real estate remain the most-searched product categories.
Mercer said real estate has experienced a real surge in popularity, with the number of searches performed in the past year up from 12 to 62. The amount placed, however, remains virtually unchanged at US$1.8 billion, reflecting a trend for larger placements.
With regards to Australia, the report found that the number of searches performed in 2007 dropped to 82 from 110 in 2006. However, the amount placed increased from US$9.3 billion to US$10.1 billion.
Australian and global equities were the biggest drivers of search activity, with several Mercer clients conducting overall reviews of their Australian equities allocations.
According to report, the popularity of so-called socially responsible investing (SRI) continues to rise, and Mercer expects this to continue in 2008.
Commenting on the findings, Mercer head of research in Asia Marianne Feeley said there had also been a significant increase in the number of searches to do with emerging market equities.
“Australian clients [tended to favour] global emerging market mandates rather than region or country-specific mandates,” she said.
“Also, after several years of minimal activity, there were multiple searches for currency managers due to recent fluctuations in the value of the Australian dollar.”
Recommended for you
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
Having peaked at more than 40 per cent growth since the first M&A bid, Insignia Financial shares have returned to earth six months later as the company awaits a final decision from CC Capital.
