Is multi-management the future of the investment industry (2009)?

Résumé du document

This report was written after the events of summer 2008 heightened the need to detail the financial environment and the new tools that one could use to improve investments returns in the long term. One of the tools examined is that of multi-management. The report shows that this is a new way of investing which is more dynamic and faster at responding to the needs of a changing market. Furthermore, the report shows that multi-management is needed because the investments industry is becoming increasingly complex. Therefore, multi-management helps investors make good investment choices. The report also shows that this new concept leaves investors in doubt concerning the way the multi-manager is diversifying its fund. It is thus supposed that these interrogations are possible because investors are still attached to basic rules of investment.

Extraits

[...] I believe that open architecture is more a way to tell the clients that they can trust you, because the bank they are working with is here to help, and to answer its needs. At the end of the day, a happy client is a client who comes back to you and who talks about you. So why not take a chance and invest in a new way of making money by switching to open architecture? Bibliography Internet Site Select Fund.com L'expansion.fr. 10/05/2001. L'agefi.fr. [...]

[...] Is diversification good or bad for a multi-manager fund? It is highly unlikely that any one manager will deliver top annual performance over the longer term with any consistency. This is largely because managers follow different investment styles, which work better in different market cycles than others, that a multi-manager fund is diversified and reduce the risk. To take an example, property and bond funds tend to do well when interest rates decline, while money market funds perform better when interest rates rise. [...]

[...] 19/04/2007. Letemps.ch L'agefi.lu. 07/2006. http://www.agefi.lu Book Roberto de Paula Lico Júnior. Dictionary of Financial and Business Terms. Lico Reis Consultoria & Línguas. Markowitz, Harry M. (1959). Portfolio Selection: Efficient Diversification of Investments. John Wiley & Sons, New Jersey. [...]

[...] “manager of managers is an investment fund that uses an investment strategy of directly selecting different investment managers and gives them a mandate to make investment decisions. This is different from the traditional mutual fund where only one manager invests the funds' capital in stocks, bonds or other investment vehicles. A “manager of managers fund” is one type of multi-manager investment. The other type is fund of funds[7]. The manager of a large pension fund would appoint different investment managers for different asset classes such as equities, bonds, and commodities. [...]

[...] The accessibility Like every secret potion, multi-management presents some dangers, notably for the banks asked to market these products. If the best managers are outside of the bank, the customers wonder if the internal manager, presented at first as unbeatable, is still a good investment. Why go to the bank when you can go directly to the source? Multi-management could become a victim of its success, dominated as its by a small group of players - Russell Investments held of the market in 2007, SEI Investments held and the National Australia Bank Almost 50% of the market is therefore divided between these three managers. [...]