Wikimedia Commons Roque Calleja. Roque Calleja Moves Back to NY as Head of BlackRock Alternative Specialists (BAS) for Latin America
Roque Calleja will move to New York next April, as Head of BlackRock Alternative Specialists (BAS) for Latin America. In this role he will work closely with Sara Litt, who has been a member of the BAS Latin America team since 2016 and will report to Armando Senra, Head of Latin America at BlackRock.
In his new position, Calleja will be responsible for strategy and fundraising for BlackRock’s alternatives platform working closely with Latin American institutional and wealth clients across hedge funds, private equity, real assets and private credit.
Calleja has worked for BlackRock in Mexico since 2014, first as vice president and since 2017 he has been co-director of the Institutional Business together with Giovanni Onate, who will lead the business individually when Calleja leaves. According to an internal memo to which Funds Society had access, “During this time, BlackRock has become the leading asset manager for active mandates in Mexico and one of the leading asset managers for local and international alternative investments… This appointment reflects BlackRock’s continued focus on alternatives as a strategic growth area and the growing demand from clients across the region for alternative assets.”
Serna added: “Latin American clients are increasingly relying on alternative investments as a critical component of their asset allocation in order to build resilient, diversified portfolios that can enhance long-term returns. BlackRock’s alternatives platform offers clients unparalleled breadth across alternatives asset classes, a global footprint, and robust sourcing capabilities, which combined with our risk management platform positions us well to deliver to clients best in class alternatives solutions.”
Calleja joined BlackRock in 2009 as a member of BlackRock’s iShares business in Iberia. He later moved to New York where he supported BlackRock’s Latin America and Iberia business and was responsible for managing the retail offshore wealth business. He has a BA degree in business administration and a Master’s degree in Business Strategy from the Francisco de Vitoria university in Madrid, Spain. He also holds a master’s degree in alternative investments and Hedge Funds by the Instituto de Estudios Bursatiles (IEB) university in Madrid.
BlackRock’s alternatives platform currently manages over $172 billion in client assets and comprises a global team of over 800 investment professionals sourcing and structuring both direct and fund investments.
Foto cedidaJosé Castellano, CEO adjunto y director de desarrollo de Negocio Internacional de iM Global Partner.. iM Global Partner: "Los sistemas de pensiones alrededor del mundo rotan hacia gestoras especializadas"
2019 brings a world of opportunities to iM Global Partners, a multi-boutique platform with offices in Paris, London and Philadelphia. That is what José Castellano, Deputy CEO, and Head of International Business Development is tasked with.
In an interview with Funds Society, Castellano, who joined the firm earlier this year, mentions that considering there is a worldwide strong appetite for alpha products from the best asset management companies, they are currently developing a global distribution platform.
In his opinion, “pension systems around the world are looking at specialized active managers while keeping the passive side invested with large asset managers.” And he believes their partners “have the quality to get strong appetite for alpha from investors”, so he is trying to take them to global portfolios while also looking to add on more partners. “We have clients almost everywhere not because we are active on the business perspective but because our partners are so good they have been already identified.”
iM Global Partners currently has strategic minority investments in four management companies – Polen Capital, Dolan McEniry Capital Management, Sirios Capital Management and Dynamic Beta investments but they have a big pipeline and ambitions.
“One of the reasons I got involved with the company, besides of how I see the industry, with big opportunities for alpha managers in the world, and that I also like that it is very entrepreneurial, flexible, effective, but also, because we have a huge level of ambition to grow the platform tremendously. I can tell you our intention is to invest in the next years up to 500 million, we have already deployed around 125 million so [we are looking to partner with] somewhere between 10-20 different asset managers with between 1-20 billion in AUM.”
Castellano mentions they have a very long pipeline and a number of ongoing conversations. Currently they are looking to close 1-3 transactions a year, and that they “are looking at liquid alternatives, US equities, European equities, Emerging Market Debt and US credit, as the asset classes where we are putting a lot of effort.”
Why partner with iM Global Partners?
According to the industry veteran, iM Global Partners is especially attractive to asset managers given that they have entrepreneurial DNA: “We are very flexible, we can talk to them every day, and we only buy minority stakes, between 20-49%. We do not want to manage the company, but we want to be very active on the business side. In that case we are very flexible and tackle it on a case by case base. We also offer permanent capital.” Castellano believes asset management is a long term game and so is its relationship with their partners. They provide a distribution platform but there is a full alignment of interests, since they are not only distributions but partners.
What are they looking for?
“When we buy stake in the AM we make sure we can accelerate their growth exponentially. For example if we buy someone with 3 Billion AUM is because we know they have the potential to go to 6, 10, 20 billion in AUM. Our idea is to help them grow exponentially by exposing them to other areas of the world.” Castellano mentions adding that their main consideration when building the pipeline is finding the right people, right talent and outstanding performance over time. “They have to be excellent in the long run but more with a difficult market because we believe that the best managers shine when they have a difficult market.”
Their mayor focus in the first half of 2019 is to launch Europe and expose their partners to the European market. They are having events in February in Paris, Zurich, Milan, Madrid, Lisbon and the UK.
For the second part of the year they are looking at Asia-Pacific since they are engaged with some Australian partners, and Latin America.
Photo: Shenandoah National Park. 201 Global Asset Managers Can Now Try to Woo Mexican Pension Funds
It is official, Afores can now invest in international mutual funds. The meeting and authorization of the Risk Analysis Committee (CAR) that international managers, afores and the regulator have been waiting for since 2017, has already taken place and, as a result, the guidelines by which afores can invest in mutual funds with active strategies can be consulted in only 12 pages.
In summary, in order to be elegible the manager should have at least 10 years of experience managing investment vehicles or investment mandates, as well as at least 50 billion dollars in assets under management. The same amount that applies to managers looking for an investment mandate. According to the CAR document, this requirement, which is fulfilled by the 201 largest asset managers in the world, can be modified by the Investment Committees of the Pension Funds by “considering criteria such as the experience of the administrator in the management of assets in the international markets of the strategy object of investment, the performance of the Fund, as well as additional criteria determined by their own Investment Committees.”
The fund in particular must have at least 2 years of operation since its inception and more than 100 million dollars in assets. In addition to being open funds of an Eligible Country for Investments and having a benchmark.
Although the guidelines do not indicate that the daily composition of the funds should be known, a condition with which several players were not comfortable, they do mention that the net value of the assets of the fund should be known daily.
The fund itself may use derivatives to reduce costs, manage liquidity, marginally facilitate the replication of the index or sub-index or for risk management but not to increase returns, leverage or synthetically replicate the benchmark.
In addition, to preserve the active nature of the strategy, investment in other funds or ETFs will not be allowed.
This resolution marks a milestone in the way Afores can invest and has been in the process for several years, as well as the increase of the 20% limit on investment in foreign securities, which the CONSAR confirms that they are still working to achieve. For this to change, there needs to be change to the law, which is now underway, but without a doubt, the approval of the investment in international funds will change the market in Mexico and the way of investing the afores, for the benefit of the workers.
Patrick Dwyer, Miami Area Winner 2019. The Best Advisor in Florida is...
The Forbes ranking of Best-In-State Wealth Advisors, developed by SHOOK Research, spotlights over 3,000 top advisors across the country who were nominated by their firms—and then researched, interviewed and assigned a ranking within their respective states.
Those advisors that are considered have a minimum of seven years experience, and are ranked using an algorithm that weights factors like revenue trends, assets under management, compliance records, industry experience and those that encompass best practices in their practices and approach to working with clients. Portfolio performance is not a criteria due to varying client objectives and lack of audited data.
In Florida, for the Coral Gables and Miami Area 51 advisors made the cut. The top 2 come from Merril, Patrick Dwyer and Louis Chiavacci, while on the third place we find Adam Carlin from Morgan Stanley Private Wealth Management.
For Northern Florida, 100 advisors made the list, with Merril’s Michael Valdes at the top. He was followed by Clarke Lemons from WaterOak Advisors and Bob Doyle from Doyle Wealth Management.
94 advisors from South Florida were included on Forbes list. At the top are Thomas Moran from Wells Fargo Advisors, Sal Tiano from JP Morgan Securities and Don d’Adesky from The Americas Group of Raymond James.
Photo: maxpixel CC0. The Fed is Looking to Prepare a Plan to Stop Reducing its Balance
The Federal Reserve, which at its meeting on January 29 and 30 decided to keep the reference rate unchanged, said in its minutes, published this Wednesday, that there is greater concern about the risks to the economic growth of the US and that it is open to preparing a plan to stop reducing its balance.
The FOMC continued with the message that it would be “patient” to decide when and how to adjust policy to a growing set of risks, including the slowdown in growth in China and Europe, Brexit, trade negotiations and the effects of the five-week shut-down of the United States government, pointing out to a wait and see aproach about how the economy unfolds with the current policy, indicating that for now it has suspended interest rate increases.
The minutes also show that they are prepared to be more flexible in reducing their overall balance, made up of a 4 trillion dollars portfolio of bonds and other assets: “Almost all participants thought that it would be desirable to announce before too long a plan to stop reducing the Federal Reserve’s asset holdings later this year.” they point out.
Photo: Onsen. Multi-Asset Funds did Not Work in 2018 because they Largely Replicated what Advisers Were Doing Themselves
Multi-asset funds failed to protect investors from the impact of volatile equity markets in 2018, according to the Natixis IM Global Portfolio Barometer.
Adviser portfolios delivered negative returns across all regions, driven by falls in equity markets. But the analysis of investor portfolios in seven markets, conducted by the Natixis Portfolio Research & Consulting Group, found that multi-asset funds did not provide diversification as expected, and instead had very high correlations to adviser portfolios. This suggests multi-asset funds largely replicated what advisers were doing themselves.
Equities were the largest contributor to negative returns in all regions, costing around 3-5% on average – except in Italy, where advisers had much lower equity allocations. However, multi-asset funds were the second largest detractor, costing 0.5-2% on average, and particularly affecting France, where these funds have traditionally been very popular.
Alternative investments, like real estate and managed futures, were more resilient to volatility than traditional asset classes, but still contributed marginally to portfolio performance at best, due to lacklustre performance and low allocations. Real assets contributed little except in the UK, where property funds were a positive contributor to portfolios.
Matthew Riley, Head of Research in the Portfolio Research and Consulting Group at Natixis IM, commented: “It’s natural for investors to seek shelter from volatile markets by diversifying portfolios, but it is clear from our analysis that, in 2018, the majority of multi-asset funds fell short and largely failed to diversify, which only added to portfolio losses”.
“Our findings show that investors really need to look more closely when selecting a multi-asset fund, ensuring that the fund is aligned with their investment objective. This due diligence should include checking the fund’s correlation to their existing portfolios, as well as to bonds and equities, to make sure it will improve the risk-return profile of the portfolio.”
Italy showing most resilience to volatile markets
In stark contrast to 2017, advisers in all regions suffered negative portfolio performance in 2018 with the impact of falling equity markets and muted fixed income returns taking their toll. Italy was the most resilient market, with estimated losses of 3.2% for the average adviser portfolio, due to a much lower allocation to equities. Advisers in Italy had an average equity exposure of just 20%, while the UK and the US had a more bullish stance, with equity weightings of over 50% in moderate risk portfolios.
Currency risk continues to weigh on portfolios
In 2017, the Global Portfolio Barometer revealed the impact of currency risk on performance. And, while slightly reduced, it remained an important factor in 2018, benefitting European investors compared to their US counterparts. Currency moves remain an often overlooked area of risk, but when considering a more internationally exposed portfolio, not paying attention to it can have a significant impact on overall returns. For instance, in 2018 a European investor allocating to US equities would have experienced a small positive return of 0.3% in euro terms – a US investor would have lost 5%.
The quest for true diversification continues…
In short, the findings of the Global Portfolio Barometer highlight the impact that the return of volatility had on markets and investor portfolios, with portfolio risks potentially rising from the extraordinarily low levels seen in 2017. Multi-asset funds simply failed to provide diversification, which should be food for thought when considering the relationship between diversification, risk and returns in adviser portfolios.
The Mirabaud Group, the banking and finance group founded in Geneva in 1819, has obtained the necessary authorisations from the Central Bank of Uruguay to open two Wealth Management subsidiaries. Both located in Montevideo, Mirabaud Advisory (Uruguay) SA will offer Mirabaud’s services to local clients, while Mirabaud International Advisory (Uruguay) SA will provide services to clients from other Latin American countries.
These openings strengthen Mirabaud’s wealth management presence and follow the creation of Mirabaud Asset Management (Brasil) Ltda in São Paulo earlier in the year which marked Mirabaud’s arrival on the South American continent. Both Uruguayan companies will be managed by Fabio Kreplak, with the support of Thiago Frazao, Limited Partner. According to the company, these openings represent a further step in Mirabaud’s international development strategy.
Nicolas Mirabaud, Managing Partner and Head of Wealth Management for the Mirabaud Group, is “delighted with the opening of these two new subsidiaries in Mirabaud’s bicentenary year. For 200 years Mirabaud has always focused on serving the interests of its clients and protecting their assets by offering them investment solutions tailored to their needs. In recent years our Latin American client base has grown, so it was natural for us to establish a presence closer to them in order to serve them better. Opening these subsidiaries in South America once again demonstrates that Mirabaud maintains its entrepreneurial family spirit.”
Thiago Frazao, Head of Wealth Management for the LATAM market, emphasises how “Mirabaud’s diversified and personalised offering meets the needs of clients looking for confidence, stability and financial performance. Mirabaud is present on four continents and in ten countries and can call on a network of experts covering the various fields of wealth management. With their comprehensive knowledge of the South American market and Swiss wealth management expertise, Fabio Kreplak and his team are fully integrated into the Mirabaud culture and approach.”
Fabio Kreplak, who gained extensive experience in Latin America at UBS and then at Julius Baer, is “honoured to join Mirabaud and contribute to its development from Montevideo. Mirabaud has an excellent reputation among finance professionals, who recognise the firm’s tailor-made approach, international expertise and standards of excellence, which are essential assets in a booming Latin American market. Our clients will be able to benefit from the full range of investments and services offered by the Wealth Management team.”
The team based in Montevideo is expected to reach half a dozen employees during the course of this year.
Foto: NPS CC0. Investors Trust Opens Insurer in Puerto Rico
Investors Trust welcomes ITA International Insurer, the most recent member of its group. International Insurer is an insurance company in Puerto Rico, a jurisdiction that the firm considers ideal for insurers and reinsurers in Latin America, Europe and other international markets.
“As a United States Commonwealth, Puerto Rico’s free market economy is subject to both federal and state regulations designed to protect free market-competition; specifically, but not limited to, the insurance and banking industries. This position further stabilizes Puerto Rico as an attractive domicile for international insurance business and provides legal peace of mind for companies and individuals.” said the company in a statement.
Investors Trust has also established an International Financial Entity (IFE) in Puerto Rico to consolidate all banking and custody transactions for the group of insurance companies, ITA International Financial Services Corporation.
“The need for greater diversity and new jurisdictions has led Investors Trust to reposition itself as a multi-jurisdictional insurance group. With the establishment of ITA International Insurer in Puerto Rico, clients now have more options to choose a plan based on their specific needs and preferences.” said the company that anticipates further growth in 2019 to support their multijurisdictional structure.
En 2018 el patrimonio de las IICs en España se situó en 454.761 millones de euros, una 2% menos que en 2017. Además, el número de partícipes y de accionistas ha continuado incrementándose en el año y se situó a finales de 2018 en 13,9 millones, un 6,8% más que el año anterior.
La renta fija ha continuado reduciendo su peso en la cartera y ya supone menos de la mitad (47,8%). Por su parte, la posición en renta variable en cartera ha continuado incrementándose en el periodo y supone el 15,6% frente al 14,3% de 2017. “Vamos hacia una normalización desde la asignación a renta fija corto plazo a la renta variable, pero todavía estamos lejos de países como Reino Unido donde el 50% está en acciones”, ha argumentado Lázaro de Lázaro, presidente de la agrupación de IIC de Inverco, durante un encuentro con periodistas.
En cuanto a rentabilidades, la elevada volatilidad presente en los mercados financieros durante 2018 ha llevado a los fondos de inversión a registrar rendimientos negativos en el año, siendo la rentabilidad interanual para el conjunto de fondos del -4,81%.
Perspectivas para 2019
Inverco pronostica que la rentabilidad de las IIC (Instituciones de Inversión Colectiva) en 2019 se sitúe entre el 2% y el 2,5% y las suscripciones netas continúen con la tendencia positiva de los últimos años. La patronal espera, además, que los fondos de inversión incrementen su patrimonio en torno a 13.500 millones de euros, un 5,2% más, alcanzando a finales de este año los 271.000 millones de euros. Por su parte, las IIC extranjeras incrementarían su patrimonio hasta los 176.000 millones de euros, lo que supone un incremento del 4,8%.
En cuanto al volumen de los fondos de pensiones podría aumentar en 2019 en casi 3.000 millones de euros (un crecimiento del 2,8%), cerrando el año en un patrimonio de 110.000 millones de euros. Además, se espera que la rotación hacia activos de más riesgo se traduzca también en rentabilidades más altas en el medio y largo plazo. “Los fondos de pensiones mixtos han pasado de representar el 29% al 58% y esto en el largo plazo va a producir mayores rentabilidades. Hay un poquito más de apetito por el riesgo y eso se ve en los planes de pensiones”, explica Juan José Cotorruelo, director de Vida y Pensiones de Caser.
Una tendencia que también se observa en fondos de inversión. Mientras que en 2007 casi el 64% del patrimonio de los fondos de inversión pertenecía a vocaciones conservadoras (39% monetarios y renta fija a corto plazo y 25% garantizados), en diciembre de 2018 apenas el 31% del ahorro en fondos se canaliza a través de este tipo de instrumentos.
¿Quién invierte en fondos de inversión en España?
Como novedad este año Inverco ha analizado el tipo de inversor que adquiere fondos de inversión entre los distintos países europeos. Así, por ejemplo, mientras que en España el 62% del volumen de activos total de los fondos pertenece a los hogares, en países como Francia o Alemania este porcentaje es del 26%, donde la mayor parte del patrimonio de los fondos está en manos de inversores institucionales.
Pixabay CC0 Public Domainpadrinan. What Can Investors Expect From China in Year of the Pig?
This month China started the year of the pig. In the Asian tradition, this is an animal directly related to fortune because of its nobility and fertility. Will this lunar new year bring fortune to investors or succulent returns to the Chinese stock market?
In the opinion of Michael Bourke, manager of the M&G (Lux) Global Emerging Markets fund, after a difficult year for stocks in 2018, “investors expect the new lunar year to generate better prospects for the Chinese stock market. The new year may typically be a time for optimism, but there remains a great uncertainty about the outlook for China. The country’s trade dispute with the United States dominates the headlines and the fear that US tariffs on Chinese products will begin to have a negative impact on the world’s second largest economy are worrying investors. Recent economic data has been weak, factory activity and exports are slowing, and last year the economy grew at 6.4%, its slowest pace since 1990.”
Hernando Lacave, manager at DIF Broker has the same concern: “In the year of the pig we will continue to talk about deceleration in China, where growth for 2019 is expected to fall to 6%. However, this is still much better than the 2.5% expected for the United States or 1.6% of the EMU, so bad macro data should not blind us since China will continue to be the engine of growth of the world economy.”
Investment experts warn that the commercial war is beginning to weigh on China, and although the slowdown started years ago, there are signs that this war is not only affecting the foreign sector but increasingly its internal economy. “Given the size of China, it is logical that it should no longer be treated as an emerging economy and be required to play with the same intellectual property rules than the rest of developed countries. In addition to the positives that an agreement would bring, bad macro data could be the catalyst needed for the Chinese Central Bank to launch incentives to keep growth for a long time, and they have margin to do so,” clarifies Lacave.
For managers, the important thing is that China continues to reorient its economic model from one based on investment in fixed assets to one driven by the growth of consumption, especially in the services sector. This transformation is being led by private companies that aim to generate profits and tend to be less capital intensive, unlike what happened during the boom of fixed assets, when state banks granted huge amounts of credit to other state entities and Real estate developers financed by the State. At Newton, part of BNY Mellon, when investing, they prefer to avoid those sectors. “Now that fixed assets have less weight in the Chinese economy, it is very likely that GDP growth will suffer. However, the growth registered will be of higher quality. We can expect the GDP to grow more slowly during this period of rebalancing, a change that, in our opinion, should not be detrimental to the more consumer-oriented areas of the economy, since the employment component of GDP will increase. The latest measures by the Chinese authorities have been aimed at making the lending more flexible and at supporting the middle classes through tax cuts,” explains Rob Marshall-Lee, Head of Asian and Emerging Equity at Newton.
Finally, Neil Dwane, global strategist at Allianz Global Investors, notes that “China’s high levels of debt and slower growth are likely to last beyond the New Year celebrations, but we believe that the Chinese government has the right tools to solve them. With China’s economy set to become the world’s largest, we believe that investors should think of China as an asset class.”
