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Laxman Pai, Opalesque Asia: Less seeding/allocating to emerging managers is taking place, said a survey. Compared with last year, allocators/seeders are meeting with and investing with fewer emerging managers, Peltz International's 2019 Survey of Allocators/Seeders of Emerging Managers said.
Lois Peltz, president of Peltz International and author of the report, commented: "Despite less seeding occurring, the average amount provided to each manager, at $31.2 million, is higher than the 2018 survey. The average stake taken is also higher at 21.7%."
Three-quarters of the surveyed seeders/allocators have invested with at least one emerging manager during the past year, the report said. On average, the typical seeder has allocated to three emerging managers during the past year.
Strategy is the most important characteristic in selecting emerging managers. Niche strategies are of the most interest. Distressed and private equity tied for second place.
Key highlights of the survey
According to the allocators, the preferred asset size for emerging managers averaged $173 million.
The most often provided service to early-stage managers is providing strategic advice.
About 31% of those surveyed use an equity-stake approach.
The typical relationship with the manager lasts about 5 ½ years.
The average management fee paid to emerging managers is 1.29% while the average performance fee is 16.7%.
Comprising over 30%, the largest perc...................... To view our full article Click here
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