Top Reads of 2019

Costs and Fees, “Diversifying” Strategies and Private Markets (particularly with an ESG/impact) twist dominated the viewing statistics for the last twelve months. Below, readers can find the Top Five.

Investment Management Fees: Is Competition Working?                                      Most-read white paper of the year with over 2700 unique downloads since its publication in October, the latest edition of the biennial Investment Management Fees report revealed the latest fee trends including substantial price reductions in Absolute Return Bonds, Emerging Market Equities, Fund of Hedge Funds and more. Yet why are fees falling in certain areas yet remaining resilient in others?

How Alberta Teachers' is Investing 'Between the Seams                                      2019 saw the launch of the increasingly popular ‘Investor Spotlight’ series, featuring interviews with leading figures at pension funds, insurers and other asset allocators around the globe. Here, ATRF’s Absolute Return head Darryl Orom explores the difficulty of seeking “diversification plus return.” With many diversifying strategies falling short on performance, Orom’s team is exploring the niches that others overlook.

Investing in Renewables: Navigating the Transition                                                Once a small niche of the infrastructure asset class, renewable energy investing has exploded in size and maturity with a universe of over 50 managers offering strategies dedicated to the sector as of February 2019. Yet the winds of change are blowing as government subsidies decline, corporate PPAs rise and less conventional sub-sectors take on greater prominence in portfolios. Infrastructure specialist Anish Butani writes.

Hedge Funds Plus Risk Premia: Fantastic Fusion or Baffling Blend?            A growing number of investors are now using both Alternative Risk Premia (ARP) and Hedge Funds in their portfolios – sometimes even in a single mandate, with more than 16 firms now offering a blended product. The two make natural, albeit somewhat uneasy, bedfellows. Yet just how coherent are these combinations? Suboptimal approaches can lead to excessive overlaps in exposures, alignment problems and more.

Tackling Hidden Costs in Private Debt                                                                      New in 2019, the “Hidden Costs” series takes a look at the types of leakage that investors and trustees may overlook. This paper, primarily written for non-US investors in US private debt (but with interesting implications for US clients also), examined how fund structures designed with tax efficiency mind can lead investors to incur other – often invisible – types of leakage.

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