Wed, Oct 22, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

European 'smart beta’ allocations to reach $500.2bn within five years - Part 1

Monday, May 26, 2014

Komfie Manalo, Opalesque Asia:

'Smart beta’ is another buzzword to hit the asset management industry over the past decades. Industry experts predicted allocations into European smart beta could reach $500.2bn (GBP 297bn) within the next five years from its current size of $131.4bn (GBP 78bn), said data tracker Spence Johnson. Indeed, one U.S. firm closely linked with smart beta, Research Affiliates, currently has some $12bn in assets using its fundamental benchmarks even though it is less than 10 years old.

A report by Financial News quoted Research Affiliates chief executive Robert Arnott as saying, "Two of the three largest institutional investors in each region are now doing a pilot program of at least a billion in fundamental indexing."

Smart beta allows investors to take an accepted index such as the FTSE 100 and then re-rank the companies in it by one or several sets of rules. In effect, smart beta fund managers rejig the benchmark index, change the weight of its constituents to produce higher return than the index would have produced in its original format.

But the rise in smart beta is a bane to other investments. A study commissioned by the State Street Global Advisers showed that assets held in "actively managed funds" in the UK dropped to 53.6% in 2013 from 66.8% in 2009.

JP Morgan Asset Management......................

To view our full article Click here

Banner

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Commodities - Oil wreaking havoc on small-cap energy stocks sliding 36%[more]

    From Bloomberg.com: Owning almost anything in the U.S. stock market has been a losing proposition since September. Owning smaller energy companies has been a catastrophe. Hercules Offshore Inc. and Resolute Energy Corp. are among 19 oil-and-gas equities in the Russell 2000 Index that lost more than

  2. Investing - Hedge funds favor equity long/short, Strategic bond managers hedge against further high yield sell-off[more]

    Hedge funds favor equity long/short From Securitieslendingtimes.com: Equity long/short strategies will generate good returns for hedge funds in the future, according to a panel at this year’s Risk Management Association Conference on Securities Lending in Naples, Florida. Panellists Sand

  3. Legal - Ex-hedge fund analyst weeps as judge hands down 5 year sentence, Former Columbus investment manager Steven P. Moore indicted on theft charges, SEBI confirms ban for Hong Kong hedge fund, SEC announces enforcement action against compliance officer[more]

    Ex-hedge fund analyst weeps as judge hands down 5 year sentence From Hereisthecity.com: An ex-hedge fund analyst was sentenced to 5 years in prison for his role in insider-trading scheme. The New York Post reports that former hedge fund analyst Matthew Teeple was sentenced Thursday to fiv

  4. Goldman in talks to acquire IndexIQ[more]

    From Bloomberg.com: Can Goldman Sachs put ETF investors on a liquid diet? Goldman is in talks to acquire IndexIQ, Reuters has reported. Index IQ is a small exchange-traded-fund firm known mostly for products that replicate hedge fund strategies, called "liquid alternative" ETFs. While IndexIQ has 11

  5. Other Voices: CALPERS dilemma should be a warning to hedge funds wanting institutional investors[more]

    From Ian Hamilton, founder of IDS Group. A quick comment on the CALPERS’ disinvestment from the hedge fund market and the jitters it is causing. Pension Funds should not be sheep and follow CALPERS’ decision as the issues that CALPERS has with hedge fund investments are in many ways unique t