Fri, Mar 27, 2015
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

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. Other Voices: Does the hedge fund industry benefit society?[more]

    This article was authored by Don Steinbrugge, Chairman of Agecroft Partners, a US-based global consulting and third party marketing firm for hedge funds. It is no secret that the hedge fund industry is viewed negatively by a la

  2. Private credit comes into focus for investors[more]

    Bailey McCann, Opalesque New York: As investors look for a way out of the low yield/no yield environment, private credit is becoming an increasingly attractive asset class, according to a white paper from Bayshore Capital Advisors. Private credit has grown steadily since the financial crisis as

  3. Other Voices: The role of diversification in CTA portfolios[more]

    2014 brought a resurgence of managed futures strategies, or CTAs, which performed very well as a whole, outperforming all other hedge fund strategies. However, a closer look reveals that there was a wide range of performance, or return dispersion, across managers. The bottom line? Not all CTAs

  4. Neuberger Berman unit buys 20% stake in activist hedge fund Jana Partners for $2bn[more]

    Komfie Manalo, Opalesque Asia: Neuberger Berman’s unit Dyal Capital Partners bought a 20% stake in activist hedge fund firm Jana Partners worth $2bn, WSJ.com reports. The deal comes as activi

  5. Hedge fund launches fall again, $1bn funds found to outperform even smaller hedge funds[more]

    Komfie Manalo, Opalesque Asia: The number of new hedge fund launches fell again in 2014, the third consecutive year of decline, while fund liquidations saw their first drop since 2010, according to the latest HFR Market Microstructure Industry Report released by industry data provider HFR. Acc

 

banner