Asset management

GAM bond fund freeze gets partial vindication

16 Jul 2019

Investors in $11 bln of funds managed by the Swiss group, suspended last year, will get their money back. The recovery supports the idea that blocking withdrawals is a good way to sell illiquid assets, at least in benign markets. The damage to GAM’s business will last longer.

BoE raises tricky liquidity bar for asset managers

11 Jul 2019

Governor Mark Carney cited $30 trillion of easy-access funds which invest in longer-dated assets worldwide as a “medium-term” financial risk. Recent problems for UK stock-picker Neil Woodford and Natixis require a response. Savers could face a longer wait to get their money out.

UK climate disclosure needs more than a big stick

2 Jul 2019

The government may force companies and pension funds to say how global warming will affect them. That might catch out the few that currently don’t. But given information from those that do is often useless, setting clear rules may be better than a legal obligation to publish.

Natixis gives lesson in bond market fragility

24 Jun 2019

A fund unit owned by the French bank had to write down holdings of exotic bonds and penalise investors who pull money. It’s a prudent move that may stem outflows. But investors will be more nervous in future about funds that dabble in esoteric debt while promising easy liquidity.

Nelson Peltz snaps up $16 bln Brexit fixer-upper

13 Jun 2019

The activist investor has taken a 6% stake in London-listed construction group Ferguson. Selling the UK unit, which has been hit by dismal growth since the country voted to leave the EU, would boost profitability. Relisting in New York could help close a valuation gap with peers.

UK frozen fund exposes regulator’s limitations

10 Jun 2019

The week after a prominent money manager suspended withdrawals, the head of the UK financial watchdog said rules on illiquid assets in investment funds may need a rethink. Given EU laws limit his room for manoeuvre, Andrew Bailey may not be able to deliver major changes.

UK fund blowup leaves cheerleaders burned

6 Jun 2019

Shares in the $12 billion investment supermarket Hargreaves Lansdown have slid by 12% after a fund it promoted run by star manager Neil Woodford froze redemptions. The mess could cause clients to pull money. To keep them, Hargreaves may need to sacrifice its high fees.

SEC’s new conflict rule does investors few favors

5 Jun 2019

The U.S. securities watchdog is tightening conduct standards a bit for brokers while loosening them for investment advisers. The industry-friendly fudge leaves investors to fend for themselves. Sharp dissent within the commission underscores the weakness of that approach.

UK fund wreck shows risk of overactive management

4 Jun 2019

Stock-picker Neil Woodford had to halt redemptions after outflows. Contrarian bets on cheap stocks and unquoted companies were ill-suited to a $5 bln fund that allowed clients to withdraw money easily. Manager hubris is another reason for investors to use passive funds instead.

As impact investing grows, its purpose strays

30 May 2019

Investing for social or environmental good, once a niche for foundations and development banks, now attracts the likes of Blackstone and KKR. There’s plenty of demand for the sector’s $500 bln of capital. For the biggest players, though, it’s still all about market-rate returns.

Breakdown: ESG investing faces sustainability test

28 May 2019

Assessing environmental, social and governance risks is the hot topic in asset management. Support from politicians, millennials and fund houses, along with high-profile votes like those at Amazon and BP, should boost the $1 trln asset class. But success could create problems.

Deutsche may shaft another group of shareholders

20 May 2019

Minority investors in the German bank’s 6 bln euro asset manager could be next up in Deutsche’s wave of value destruction. Allianz and Amundi have expressed interest in DWS. But Deutsche CEO Christian Sewing's need to maintain control makes a lowball deal with UBS more likely.

Legg Mason checks all boxes for activist interest

15 May 2019

Nelson Peltz is eyeing the underperforming manager of $758 bln of assets. As a mid-sized purveyor of mostly actively managed funds, Legg Mason sits in the industry’s biggest danger zone. High costs offer some low-hanging fruit, but a sustainable turnaround is a tougher challenge.

Goldman beats path to new Wall St hunting ground

13 May 2019

The firm is courting an investment adviser in what would be its largest deal since the financial crisis. United Capital’s $23 bln in assets are a drop in the bucket for Goldman Sachs, but bring the kind of predictable earnings that boss David Solomon wants. He’s not the only one.

BlackRock’s Italian U-turn leaves state on hook

9 May 2019

A specialist fund run by the world’s largest asset manager abruptly pulled out of a 720 mln euro rescue of ailing lender Carige. It’s a belated admission the plan was too risky and relied on rosy assumptions. Italian taxpayers once again face the risk of another costly bailout.

Deutsche asset unit deal will hinge on the how

24 Apr 2019

Suitors are circling the German bank’s money management division. Allianz or Amundi are interested and have deep pockets. And talks are underway with UBS’s asset manager, the FT reports. Deutsche’s problems make the structure of any transaction as important as the price tag.

Larry Fink keeps succession options wide open

2 Apr 2019

BlackRock is empowering regional managers and tapping a new executive to accelerate its push into private equity. Chief Larry Fink hopes the shakeup will reignite growth after a difficult year. They also leave him with a wealth of choices over who might one day take up his role.

U.S. asset managers target a new arms race

1 Apr 2019

Goldman Sachs and BlackRock are the latest investment firms to bulk up their wares in the $80 trln market for fee-based advisers. These are fast displacing commissions-based brokers in managing Americans’ wealth. And the business offers spoils across the money-managing spectrum.

BlackRock sees tech as an antidote to fee pressure

22 Mar 2019

The world’s largest investment shop is paying $1.3 bln for an alternative-asset management software firm. Boss Larry Fink gains heft in a booming private-equity market and bolsters a growing technology business. It’s a smart attempt to counteract price wars in stocks and bonds.

SEC is last activist that fund investors need

21 Mar 2019

The U.S. watchdog worries that consolidation and fee pressure may be hurting small asset managers, thereby reducing choice. For sure, BlackRock and Vanguard loom ever larger over the industry. But the main problem for rival funds is justifying the fees they charge already.