Best performing institutional managers are heading for the more imaginative world of the wealth market, reports Yuri Bender.

Institutional fund managers, disillusioned by curbs on their creativity, are increasingly moving to the high net worth end of the retail market. Distributors will play a key role in their success.

Brainpower service for Bankhaus Reuschel

German private banking boutique Bankhaus Reuschel & Co has struck a deal with Brainpower, London-based supplier of investment analysis and decision support solutions for investment professionals and online financial service providers.

Yuri Bender examines fund management and back-office issues discussed at the Sibos conference in Switzerland.

Donald Brydon, chief executive of E270bn French funds house Axa Investment Managers, gave back office specialists gathered at the annual Sibos summit, organised by Swift in Geneva, some food for thought.

The US giant’s initiative to overtake its number one rival will centre on outsourcing, as Roxane McMeeken reports.

SEI Investments is planning to bring its wealth management administration and investment solutions service to Europe in a bid to out-class its rival Frank Russell. The US giant, which launched its multi-manager business on this side of the Atlantic barely two years ago, has recruited a Citibank man to spearhead the new initiative. Francis Jackson was formerly global head of the investor solutions group at Citibank Global Securities Services, where he oversaw the end-to-end management of the firm’s global custody and US domestic custody.

Returns are the number one motivation for property investors, writes Roxane McMeeken

As the Frankfurt commercial property market collapses, investors in Continental Europe are getting increasingly excited about UK real estate.

Merrill Lynch opens up international range

Merrill Lynch’s new non-US wealth management division, International Private Client, has unveiled its first series of products. John Morris, the division’s product development chief, said the range was developed in response to clients’ requests for enhanced asset allocation, investment protection and diversification.

Yuri Bender reports on the activities of UniCredito’s TradingLab outside Italy.

Following hard on the heels of Commerzbank and SG, UniCredito Italiano has entered the burgeoning UK retail market for complex investment banking products.

Originating in the US, and considered by the Americans as too sophisticated for the UK, the wrap account market gears up to spread its influence into Continental Europe. Roxane McMeeken reports.

His words do not always mean what they seem, but State Street’s Boston-based boss, John Serhant, believes in a new ‘sensitive’ strategy for Europe rather than a one-size-fits-all approach. Yuri Bender reports.

John Serhant, overlord of high net worth business and vice-chairman of E700bn US investment powerhouse State Street Global Advisors (SSgA), was in the UK to meet key clients at the Ryder Cup golf tournament.

Yuri Bender examines the inner workings of the BNP Paribas distribution machine.

The likes of Crédit Agricole, Frank Russell and Société Générale have been casting jealous glances at the volumes generated from the French market by Marc Raynaud, mastermind behind the BNP Paribas distribution machine.

European investors have turned to structured retail equity products to protect their capital as stock markets flounder.

Structured equity retail products provide a fine example of necessity being the mother of invention. Because they enable investors to choose the precise level of risk they can tolerate, the persistence and depth of the slump in Europe’s equity markets has allowed the structured products market to show its true worth. It is one of the few retail sectors where issuance is growing.

Since witnessing transaction time change from days to minutes, HSBC’s private banking branch has been singing songs of praise for the FundSettle order processing platform. Roxane McMeeken writes on the rewards of standardisation and automation.

The need to automate and standardise trade ordering, clearing and settlement in the European investment fund industry has long been preached. But the holy grail of universal straight-through processing (STP) and T+1 has yet to be reached.

Not just a medium of exchange between countries, currency has been shown by recent studies to possess the potential to reduce risk and enhance return when given greater consideration in a well-managed portfolio.

George Bernard Shaw once said that Wagner’s music was much better than it sounded. The same can be said of currency. Why? Rather than seeing currency as a by-product of exposure to overseas asset classes, currency can instead be viewed as a stand-alone asset class with the potential to reduce risk and enhance return at the total portfolio level. And in markets like those we have experienced recently anything that reduces risk and enhances return must be worthy of consideration.

Instruments designed specifically to hedge ETF exposure will allow for more precise trading and more comprehensive investment strategies.

Exchange-traded funds (ETFs) are relative newcomers to Europe. The market here began when Deutsche Börse launched its XTF segment in April 2000. Although still in its infancy, the European ETF market has grown rapidly in popularity. Another significant development for the European ETF market will occur on November 18, 2002, when Deutsche Börse’s Eurex launches ETF futures and options.

Equity investors have had the luxury of a range of indices from such providers as FTSE, Standard & Poor’s and MSCI for a long time. This has led to a wealth of products for investors such as principal protected equity products, exchange-traded funds (ETFs), futures and index trackers.

Chooser convertibles are a relatively recent and rarely used innovation, but in essence are simply bonds with a “best of” option to convert into a number of different underlying equities.

Despite the current market climate, turbo warrants have experienced huge growth since they first appeared in late 2001. In Germany this new market segment has grown strongly since the start of the year, now generating turnover of up to E3.8bn per month (which is up to 90 per cent of current plain vanilla warrants’ market volumes).

In spite of their fashionable popularity, SRI funds have been disappointing for investors. Roxane McMeeken explains what went wrong.

Ethical investment is not doing so well in Europe. Once tipped to be the next big thing, the US-led fashion for socially responsible investing (SRI) has not taken off quite as expected.

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

Opportunity knocks for the private wealth manager with the ability to pick the right start-ups.

Growth in the hedge fund world is unprecedented. And the future remains promising: according to a recent study by Oliver, Wyman & Co and UBS Warburg, European hedge fund assets will grow from E60bn today to E300bn by 2005.

Returns have slipped into the red, fuelling manager consolidation, writes Roxane McMeeken.

The European private equity market appears to be drying up, with poor investment returns, a dearth of investment opportunities and a slump in fund inflows seen in the past quarter. Nonetheless, the asset class still has a role to play in investment portfolios.

Roxane McMeeken roots out the prime commercial property sites remaining in Milan and Madrid.

The world economic slowdown has touched Italy and Spain relatively lightly. As a result, introducing a Mediterranean flavour to a property portfolio looks appealing for more reasons besides presenting an excuse for a visit to warmer climes.

As banks and fund houses sign off plans for 2003, human capital change is being felt in all but the furthest corners of the financial industry. Tim Gibson examines the offshore wealth management career panoply.

Corporate bonds are no longer considered a safe haven for investors, but, as Roxane McMeeken writes, there have never been so many tempting opportunities.