S&P reviews alternative strategies
Strong market demand for specialist strategies has led Standard & Poor’s(S&P) to review funds offering exposure outside of more traditional varieties as part of a standalone peer group.
Included in the review were single manager hedge funds, income funds, tactical allocators and multi-strategy funds.
S&P found that the highly anticipated growth of multi-strategy funds had not materialised and that the funds on offer in this sub-peer group suffer from positioning and cost/reward ratio problems.
In terms of the tactical sub-peer group, quantitative funds experienced poor performance, but their fundamental/technical counterparts delivered much better results.
S&P said further breadth of strategies and the incorporation of shorter-term momentum-style indicators would help the quantitative-style funds in the tactical sub-peer group to adapt to changing market conditions.
S&P scored single-strategy hedge fund managers well, but pointed out the high fee levels, and also gave income funds a positive review, especially the more established managers that combine strong stock picking skills with derivatives experience.
Recommended for you
An adviser has received a written reprimand from the Financial Services and Credit Panel after failing to meet his CPD requirements, the panel’s first action since June.
While efficiency remains a top priority for Australian advisers, State Street has revealed the profession is now juggling this desire with the need to maintain personalisation of its service offering.
A possible acquisition of data provider Iress is becoming a greater likelihood after the firm announced it is engaging with multiple interested parties.
AMP has reported a 61 per cent rise in inflows to its platform, with net cash flow passing $1 billion for the quarter, but superannuation fell back into outflows.
