For the past two decades, there has been a fundamental shift in prudent capital investment philosophies. Investors have been told for years that diversification enhances portfolio stability, but diversification itself has taken on a new meaning.
As Mitesh Agrawal was setting up the best-in-class teams and processes from sourcing to due-diligence and from execution to data management for the newly formed alternatives area, he was challenged by an age-old question. Who to choose from amongst the universe of fund managers with everyone claiming stellar returns?
Marketable alternatives are a substantial and important component of many endowment and foundations’ portfolios, according to the Q2 2017 NEPC Endowment and Foundation Poll, a measure of endowment and foundation views on the economy, investing, and key market trends.
The Center for Retirement Research at Boston College has put out a white paper about public pensions and alternative investments. It asks two questions: which plans have made the largest shift into alternatives? And, how has that shift mattered to their returns and risk?
A survey from NEPC revealed 68% of respondents have more than 10% of their portfolios allocated to marketable alternatives, which includes hedge funds. This marks a notable increase from last year, when NEPC’s July 2016 survey found only 45% of respondents had at least 10% allocated to hedge funds.
<p>Alternative investments have been the name of the game for many of the leaders on Benefit Canada‘s list of the <a href="http://www.benefitscanada.com/news/2017-top-100-pension-funds-report-the-evolution-of-db-pensions-100081">fastest-growing pension funds for 2016</a>.</p> <p>Both the Ontario Municipal Employees Retirement System, ranked third on the list of fastest-growing plans at 10.65 per cent growth, and Alberta Teachers’ Retirement Fund Board, ranked fourth at 10.6 per cent, saw robust performances from most of their alternative assets classes, including their real estate, infrastructure and private equity portfolios.</p> <p>At OMERS, private equity returned 12.6 per cent, with real estate following closely at 12.4 per cent and infrastructure at 11 per cent. The Alberta fund saw a 16 per cent return for infrastructure, 10 per cent for real estate and five per cent for private equity.</p>
<p>New York State Common Retirement Fund has made a $150m (€133m) commitment to Landmark Partners’ latest real estate secondaries fund.</p> <p>The pension fund told IPE Real Estate that it is investing in Landmark Real Estate Partners VIII as part of its $4.5bn opportunistic alternatives portfolio, held separately to its real estate allocation.</p>
Activist hedge fund Corvex Management has built a stake in Clariant AG in a move designed to undo the Swiss chemicals maker’s $6.4 billion planned takeover of Huntsman Corp., according to people with knowledge of the situation. Corvex, which has built a stake in Clariant that exceeds the disclosure threshold of 3 percent, plans to push the company to explore alternatives to the deal including a potential sale, said the people, who asked not to be named because the situation is private. The activist investor believes the Huntsman acquisition, which was championed by Clariant Chief Executive Officer Hariolf Kottmann, lacks strategic rationale,...
The alternatives manager has been quietly building its private wealth business over the last five years to where 15-20 percent of its assets under management now come from retail channels.
Some sovereign investors are reducing their exposure to fossil fuels or seeking clean alternatives to protect their portfolios from rising environmental risk.