Investment managers, private banks and life insurers are increasingly sending back office operations overseas.

Spain’s leading fund industry practitioners will gather in Madrid for the second PWM European Fund Series conference, sponsored by BNP Paribas Asset Management, on 18 October.

Dresdner Kleinwort Wasserstein (DrKW) has launched a set of structured products for institutional and high-net-worth clients, to be managed by Kleinwort Benson Private Bank.

As wealthy investors become increasingly savvy with their money, managers are under pressure to allocate to alternatives, often putting as much as 20 per cent in hedge funds or real estate, writes Elizabeth Cripps

EFG Bank, the Zurich-based private bank, is restructuring in preparation for an initial public offering (IPO) of 35 per cent of its share capital, said to be planned for October 2005. The bank is 67 per cent owned by EFG Group, the financial engine room of the billionaire Latsis family shipping empire. The remainder of the shares are owned by the highly entrepreneurial management of the bank.

While details are scarce, it is believed that a new holding company has been established to hold 100 per cent of the bank, together with other assets which are thought to include some of the group’s investment fund activities.

This structure would create one of the purest private banking plays available to public investors anywhere.

HSBC may have a reputation for taking over boutique investment houses, but its head of asset management Alain Dromer says that it will only rebrand the acquired firm if it believes HSBC has a stronger presence in that market. And there is always room for compromise....He talks to Yuri Bender

One of the key planks behind the new HSBC structure is the development of a strong multi-management unit.

When Jean-Luc Pararie approached the big wigs at Crédit Agricole with the idea of distributing third-party funds, he faced an uphill struggle. But now he runs an empire worth e6bn. He talks to Yuri Bender

Next to the thorough, yet mild-mannered due diligence conducted by Jean-Luc Paraire’s team, the probing of his sister group in alternatives can seem almost aggressive.

At last, distributors are beginning to realise that they do not have the in-house expertise to make the most of the range of products they are expected to deal with and are looking towards outsourcing non-core investments. However, one potential pitfall is ensuring you pick the right manager for the job, writes Elizabeth Cripps

It would be easy to assume that the delegation of specialist asset management to specialist houses creates a three-link chain: provider-distributor-client.

Structured products’ popularity among distributors and investors may

conflict with the reluctance of traditional mutual fund houses to embrace them, but the increase in offerings and demand for alternatives has made them easy to sell in the current investment climate, writes Yuri Bender

Hybrid products offer many valuable features that help diversify and thereby stabilise performance of an investment portfolio. They also allow investors to gain exposure to a combination of traditional and alternative asset classes. Barclays Capital outline the structures on offer

As managers are forced to put together a high performing portfolio while avoiding exposure to risk, they are seeking different investment strategies. One solution that offers diversification, potential to generate alpha and a high degree of flexibility is absolute return products. Credit Suisse Asset Management outlines the benefits

For many asset managers, simply getting connected to SWIFT is an obstacle that comes with a big price tag and can imply an IT re-engineering project. Roger Aitken explores some innovations and solutions

As investors realise the limits of traditional asset classes in producing portfolio growth, due to unclear equity market trends and low volatility, they are looking towards alternatives to diversify their investments. BNP Paribas examines the different aspects of the increasingly popular structured products market

BNP Paribas’ Sébastien Lecaudey is targeting the UK and German

markets and believes that his one-stop-shop performance measurement

system is the ideal tool to help him do so, writes Roxane McMeeken

The euroland economy may be struggling behind its US counterpart, but it shows the potential to improve and is beginning to grow, writes Simon Hildrey

A new fund from Dutch investment house ABN Amro Asset

Management will add much capacity for distributors searching

for Indian opportunities but it has its risks, writes Elisa Trovato

“Major markets enjoyed a steady progression during the summer and entered September on a positive tone, even with oil hovering over $65 a barrel. The vigour of the market is even more impressive considering that the Fed has been raising its interest rates for over a year. Thus, our portfolio is 53 per cent invested in stock pickers, mainly in Europe and natural resources. However, we increased our US holdings, adding a new manager (Neuberger Berman): the US market is lagging all of the other major markets, which is to some extent justified by more expensive valuations, but not to that extent.”

“Best returns came from JOHCM UK Growth and from Schroder ISF Euro Alpha, rewarding our decision to retain this fund for now, despite the manager’s recent resignation. We are reviewing this position as part of our European sector review. Returns from US, Asia and emerging markets were poor; being nearly half weighted to the US meant we fared better. Emerging markets also held up well and we will reduce our exposure to this area in favour of the UK.”

“In spite of Hurricane Katrina, most equity markets have started September in good heart. Most bond markets, not surprisingly, have done the opposite. The summer rally reflected reasonable valuations and encouraging corporate earnings. Economic growth appeared to have weathered higher oil prices and picked up some momentum. The renewed rise in oil prices may dilute hopes of better growth, but might persuade the Federal Reserve to delay further tightening.”

“Although oil prices are still very high and may not come back within short period of time, we are quite confident that equities, which still are relatively attractive compared to bonds, will continue to perform very well. Therefore, we leave our portfolio unchanged and remain overweight in stocks. Emerging markets should keep on delivering an especially strong performance, as these countries benefit from the generally high prices of resources.”

“The main strategic allocation theme remains the attractiveness of equity markets as compared to other traditional asset classes and especially fixed income. This leads us to a have a low exposure to fixed income and rather to be invested in a multi-strategy fund of hedge funds, having about the same expected returns for a much lower volatility, about 2.5 per cent. Another important theme is the structural rise in commodity prices, which is implemented via two Merrill Lynch funds, ML World Mining and ML World Energy.”

“We continue to reduce our equity exposure to US managers and increase our allocation to Europe, UK, Asia and emerging markets. We made some changes to our continental European portfolio where we added Artemis European Growth, managed by Philip Wolstencroft and Peter Saacke. The managers aim to deliver superior returns by implementing a strict process, which is largely based on a rigorous 12-year-old quantitative model, combined with some manager overlay. We believe that this investment will add value and provide diversification to our model portfolio in the coming period.”

Each month in PWM, six top European asset allocators reveal how they would spend E100,000 in a fund supermarket for a fairly conservative client with a balanced strategy.

The notoriously volatile commodities market now looks stable. Elizabeth Cripps and Roxane McMeeken offer a guide to breaking into the asset class

London central property posts returns above other assets in a balanced portfolio, is immune to economic and political factors and, with the successful Olympic bid, its value is set to increase even further, writes Naomi Heaton