Funds Hub

Money managers under the microscope

from Global Investing:

Investors investigated

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We've wondered before about the validity of the British 'shareholder spring' narrative. A few high-profile casualties gave the story drama, but as we showed back in the summer, evidence of a widespread change in thinking was hard to find. KPMG has arrived at a similar conclusion this week.

This morning, FairPensions, a British charity which aims to promote responsible investment, has dug deeper into the behaviour of major institutional investors during that supposedly febrile period, and among the nuggets it has produced is the chart below of voting on contentious pay reports at annual meetings.

There are some questions which crop up straight away. What did BlackRock and Standard Life like so much about the Barclays pay deal that no other investor could spot; why did BlackRock think Martin Sorrell's potential 500% bonus was a goer; and given that, why did almost everyone think a maximum bonus award of 923% of BP CEO Bob Dudley's salary was just dandy?

(For the record, BlackRock tells us that it does not comment on voting decisions, and notes its Barclays vote was outsourced over a potential conflict of interest linked to its 2009 acquisition of BGI. Standard Life couldn't find the right people to comment directly, but a spokeswoman noted public statements that it had been pacified by concessions made by Barclays shortly before the AGM)

Morning Line-Up: BlackRock bullish, IPOs, Tower Australia

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News and views on the asset management industry from Reuters and elsewhere:

BlackRock founder upbeat on growth potential – FT

Institutional investors to shun high-price IPOs – Times

Australia’s Tower  accepts Dai-ichi’s $1.2 bln bid – Reuters

Volatility a fact of life for BlackRock’s Lyttleton

By Deborah Cicurel

After a month or two of volatile equity prices and a yo-yoing stock market, steady returns seemed about as likely as France lifting the 2010 World Cup.

However, Mark Lyttleton, co-manager of the Blackrock UK Absolute Alpha fund sees a way out, claiming his fund — which made money in 2008′s falling markets but underperformed equities in 2009′s rebound and in Q1 2010 – can navigate its way through the current macroeconomic worries.

Regulated are the cheesemakers

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Poul Nyrup Rasmussen, seen by many as the bane of the UK’s hedge funds industry for his input into the highly controversial EU directive on Alternative Investment Fund Managers, no doubt expected a hostile reception today at the Guildhall when he appeared at a debate hosted by Open Europe on the directive.

Whilst widely welcomed for his bravery in appearing, Rasmussen nevertheless came in for heavy criticism from City Minister Paul Myners, fellow panellists and an audience full of hedge fund and private equity representatives, making what was probably an uncomfortable lunchtime for the president of the EU assembly’s socialist bloc.

from DealZone:

Goldman’s Viniar: Why pay twice?

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HEALTHFOOD-ASIA/Turns out Goldman Sachs is a staunch advocate of going organic -- when it comes to the money management business.

As Barclays auctioned off its Barclays Global Investors unit this year, Goldman was widely seen as a likely acquirer. That is until Blackrock In under Larry Fink emerged as the buyer with a $13.5 billion deal.

Watch BlackRock’s Mark Lyttleton give his market view

Mark Lyttleton, manager of the 1.5 billion pound BlackRock UK Absolute Alpha fund, gives his view on the recent rebound in the equity market and his outlook for the rest of the year and beyond.

Hedge fund diversification

Tuesday’s Treasury Select Committee grilling of the hedge fund industry proved a lively affair (if somewhat hot in a crammed Westminster room), but you have to wonder how well diversified their choice of witnesses is.

As well as Chris Hohn, co-founder of TCI, the Committee picked BlackRock’s head of alternatives Douglas Shaw — a previous employee of TCI.

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