Thalius Hecksher - Foto LinkedIn. Thalius Hecksher, nuevo director general de Servicios de Administración de Fondos de Trident Trust Group
Trident Fund Services has appointed Thalius Hecksher to the newly formed position of Global Director. Hecksher will be based out of Miami /Fort Lauderdale and will have responsibility for leading the growth of the global independent fund administrator, division of the Trident Trust Group (TTG).
With Hecksher joining, TTG now has a new presence in Florida to support the growing Private Equity, Funds Business, Private Banking and Wealth Management. In his new role, he will coordinate the development of Trident’s global fund administration footprint, building on the Group’s 37-year track record and presence in 24 jurisdictions.
“We have a strong and growing fund services business, supporting clients with $30 billion in assets under management. In the last five years we have opened fund administration offices in Luxembourg, Malta and Singapore and significantly increased the scale of our U.S. operations,” explains Adam Gold, Trident Trust’s Head of Group Strategy and Development. “Thalius brings experience and talent to our global team. We are delighted he has joined us.”
Hecksher brings over 20 years’ experience in the global financial markets, specializing inhedge funds, private equity, liquid alternatives, family offices and wealth management across the Americas, UK, Europe, Middle East, Asia and the growing African market. He is a frequent media commentator on the asset management industry and is Southeast U.S. Chapter Director of the Hedge Fund Association (HFA).
“I’m very excited to be joining the Trident Fund Services team and to be working in an organization with one of the longest track records in the business, global recognition and the long-term support of its clients built on a 37-year history of reliable delivery,” says Hecksher. “Trident Fund Services has a truly global platform and a team of exceptional professionals. I’m looking forward to working with the existing team to help the business reach its full potential.”
Russian equities are among the cheapest in the world amid political and economic controversy. Yet investors might be surprised to discover that the rapidly developing retail industry offers undervalued opportunities with attractive return potential, said AB experts.
Russian equities are trading at an average P/E ratio of 6.5x versus the emerging-market average of 12.5x. There are good reasons for the discount: Russia’s economy is under severe pressure because of a weaker oil price and international sanctions as a result of its role in the conflict in Ukraine. The ruble has plunged versus the US dollar, inflation has shot up and Russia’s GDP is shrinking. Ordinary Russians are feeling the pinch in the form of declining real incomes.
“So, even the most contrarian investor needs to tread very cautiously before venturing into Russian stocks. That said, we believe selected large Russian food retailers represent a compelling structural opportunity for investors given the long-term modernization and consolidation of the country’s food retail industry”, points out Henry S. D’Auria, Chief Investment Officer, Emerging Markets Value Equities at AB, and Justin Moreau, research associate in the team.
Room to Grow?
In size terms, the industry is potentially massive; Russia’s population is as large as Germany and France combined. However, modern supermarkets remain relatively few and far between and the industry is still highly fragmented. The biggest retail chains have been expanding rapidly. Together, they’ve rolled out more than 2,000 new stores in each of the last five years. But they still have lots of room to grow and to win greater market share.
This growth potential doesn’t seem to be priced into the big Russian food retailers’ valuations, which look cheap compared with many of their emerging-market peers, opine both AB experts.
This is particularly surprising since they’re highly profitable. In other countries, intense competitive pressures have resulted in price wars, driving down industry-wide profitability. In Russia, these pressures are kept in check because the country’s vast geography and harsh climate represent significant logistical barriers to entry. Western food retailers have largely decided to stay away. The challenging business environment, economic sanctions and their unfamiliarity with the local market have persuaded them not to target Russia.
Riding out a Spending Squeeze
“Clearly, declining wages and soaring prices could curb Russian spending on food. Retailers are also pressured by government food import restrictions. Imports of fruit, vegetables, meat, fish and dairy products are banned from countries that imposed sanctions in protest at Russia’s role in Ukraine. The resulting shortages are making some items still more expensive. In this challenging environment, we think the big players are much better positioned to thrive than smaller chains and stand-alone stores” said D’Auria and Moreau.
The biggest modern chains are relatively young companies, having emerged in the 1990s and become publicly listed in the last 10 years. But they’ve fast gained the size and reach that we regard as key ingredients for success in today’s food retailing market.
Russia’s economic woes have driven down both labor and real estate costs—the big players’ two largest operating expenses. This should make it cheaper for them to open more stores in future—providing yet another boost to their consolidation prospects.
“Russia isn’t an obvious investment target in these difficult times. But because many investors are steering clear of the region, it’s an opportune moment to take a strategic look at the market. In our view, the retail sector is a good place for investors to shop for bargains that should benefit from structural change during current economic and political uncertainties, as well as—in the long run—when the conflict is ultimately resolved”.
CC-BY-SA-2.0, FlickrPhoto: Guillermo Viciano
. The Summer Months Seem Prone to Market Setbacks
The old investment adage, ‘Sell in May and go away, come back again on St Leger’s Day’ seems more pertinent than usual this year. The summer months seem prone to market setbacks in thin trading conditions. This time around not only are there some clear event risks on the horizon, but also market liquidity is likely to be even worse than usual, explained John Stopford, co-Head of Multi-asset at Investec.
The key risks are probably the threat of Greek default and of higher interest rates in the US. “To some extent, these possible events must already be partly in the price, because they are known. It is unlikely, however, that they are fully priced in as their likelihood remains uncertain and their market impact is unclear”, said Stopford.
In the case of Greece, investors appear to still put a high probability on a default being avoided. This assumes that fear of the consequences of default will force an 11th hour compromise between the institutions and Greece. The rhetoric of late, unfortunately, suggests that the risk of an accident is rising. Even if a deal is struck it may only to buy a little time for further negotiations, and would need to be passed by unpredictable parliaments and possibly electorates.
Greece is too small to have major direct economic ramifications for the global economy, and now that the ECB is buying government bonds, there is more support for peripheral markets. “At some level, however, Greek default and possible Euro exit would mark a failure of European monetary union. This should leave investors feeling less comfortable about holding other Southern European debt, at least without a higher yield premium”, point out Investec expert.
A near-term tightening of US monetary policy is seen, more so than Greek default, as quite likely. Despite this, the bond market continues to price the balance of risks towards a more dovish outcome. Investors are conditioned by post crisis experience, perhaps, to expect the FOMC to err on the side of caution. Labour market data, however, suggest that spare capacity is being used up quickly and the Fed board is in danger of falling behind the curve. Historically, said Investec the bond market has been slow to price in possible interest rate increases until they are imminent, and then the market has tended to over react.
“So the potential for a negative market reaction this summer to either event seems reasonably high, with a likely spill over into broader market volatility. The fear is that any sell-off will be exaggerated by poor liquidity, especially in bond markets. Trading volumes have been negatively impacted by market regulation which has reduced the ability and willingness of investment banks to make markets. Liquidity is likely be further diminished over the next few months, by the absence of many risk takers from their desks over the summer holiday season”, argued Stopford.
As a consequence, it seems prudent to take some risk off the table, or to buy protection. Any weakness, however, will probably be a buying opportunity as risks become more fully priced in. This is especially true for equity markets, where volatility tends to cause corrections rather than marking the end of bull markets.
Photo: Steven S.. Family Firms, an Opportunity for Minority Investors?
Family-owned firms are not just key drivers of economic growth, but also key employers. But do they generate returns comparable to benchmarks, and what type of specific risks do they pose for external shareholders?
To find out whether family firms generate returns comparable to non-family-owned peers, the Credit Suisse Research Institute analyzed financial data from the CS Global Family 900 universe, a proprietary basket composed of 920 family-owned businesses located across the globe.
From an investment point of view, sector-adjusted share price returns show that since 2006 family-owned companies have delivered superior performance: The CS Global Family 900 universe has generated a 47 percent outperformance compared to the benchmark MSCI ACWI index. This equates to an annual excess return of 4.5 percent over the nine-year period to the end of April 2015, according to the Research Institute’s study “The Family Business Model.”
Considering profitability in terms of return on equity (RoE), superior RoEs were seen in family-owned companies both in Asia and EMEA (Europe, Middle East and Africa), while US- and European-based family firms posted lower returns on equity (RoE) than benchmark. “Lower RoEs in more developed markets are indicative of more conservative strategies as well as broader priorities for family ownership beyond simply financial returns,” explained Richard Kersley, Head of Global Equity Research Product for Credit Suisse’s Investment Banking division.
But looking beyond a simple RoE analysis, data showed that the family firms in the CS Family 900 universe, excluding banks and regulated utilities, generated annual cash flow return on investment (CFROI) averaging 130 basis points higher than companies in MSCI ACWI. Over the longer term, family firms have generated twice the economic profit (earnings in excess of the opportunity cost of using assets or capital) than the benchmark.
US- and European-based family firms use less leverage than their non-family-owned peers and showed faster deleveraging following the recent financial crisis compared to benchmarks. Asian family companies, however, operate with higher leverage than the benchmark. Globally, family-owned businesses delivered smoother and more stable business cycles than the benchmark. “Sales growth is less volatile through the cycle with lower peaks and less pronounced troughs,” said Julia Dawson, an equity analyst at the bank’s Investment Banking division.
Annual sales growth has also been higher in family-owned firms – 10 percent compared to 7.3 percent for MSCI ACWI companies since 1995 – and less volatile during both the Internet bubble and the financial crisis. “A longer term corporate strategy is fundamental to the structural nature of this higher and less volatile (sales) growth,” Dawson said. “The importance of product or service quality, the development of long-term client relationships and brand loyalty, along with the focus on core products and innovation in these products rather than diversifying are all elements explaining this outperformance,” she underlined.
A founder’s premium was established when analyzing the CS Global Family 900 universe. Over the past nine years, first generation companies have delivered a share price compound annual growth rate (CAGR) of 9 percent. Share price returns are indeed the highest in the first generation, when investing alongside the founder, and then decline as family ownership passes down successive generations and the companies mature. “It pays to invest alongside the company founder, in the early years of a company’s existence that is likely to correspond to a period of high growth,” Dawson concluded.
Maria Eugenia Cordova. Maria Eugenia Cordova Appointed US Offshore Sales Manager for Miami at Henderson
Maria Eugenia Cordova has been appointed as the new Sales Manager with Henderson Global Investors for the US offshore market. She will be based in Miami, Florida, with immediate effect.
Henderson Global Investors’ has a strong commitment to these markets, with US $6 billion assets under management in the Iberian & Latin American region combined.
Maria Eugenia will report to Ignacio de la Maza, Head of Sales Iberia & Latin America, and she will be responsible for thewholesaleside of US Offshore markets.
Maria makes a welcome new addition to the team, and brings the headcount to a total of six sales people looking after Iberia & Latin America region. There are plans to further grow the sales team in Miami over the next 12 months.
Bilingual in both Spanish and English, Maria has a ten year career in asset management. Most recently she worked at Aberdeen Asset Management. Previously she was employed by Franklin Templeton, Pioneer and Chase Investment Services. She graduated from University of Florida with a BA in Economics and Finance.
Commenting on the appointment, Ignacio de la Maza, said, “Maria has an excellent blend of skills both in the asset management sector and the US Offshore market. She has spent a number of years fostering relationships with clients, and she understands their investment priorities. She adds great value to the growing presence that Henderson has in the US Offshore market.”
Photo: Pedro Ribeiro. Nikko Asset Management Expands UCITS Range
EMEA (Europe, Middle East and Africa) investors’ strong appetite for gaining exposure to specialist investment strategies is driving Nikko Asset Management to expand its range of UCITS funds.
“UCITS funds are an excellent way for clients in EMEA and other regions to access global investments in an easily accessible and efficient manner,” said Takuya Koyama, executive vice president and global head of sales at Nikko Asset Management. “The launch of more UCITS funds is central to our strategic effort to significantly expand our business in EMEA.”
Nikko Asset Management is launching two new UCITS funds this month that invest in global equities and multi-asset. These institutional quality strategies will allow sophisticated global investors access to a broad range of exposures across developed and emerging markets.
“As we position ourselves as Asia’s premier global asset manager, we are eager to leverage our expanded investment capabilities and expertise,” said Yu-Ming Wang, global head of investment at Nikko Asset Management. “We have a first-rate team of investment professionals, and now we are making their skills available to an even broader range of global clients.”
Over the past two years, Nikko Asset Management has been expanding its existing investment capabilities. The most recent addition was the highly experienced UK-based global active equity team led by William Low in August 2014. The global multi-asset team headed by Al Clark joined the company in March 2014 and the Asia ex-Japan equity team headed by Peter Sartori joined in October 2013.
The Tokyo-based asset manager has plans to launch more UCITS funds in the coming months in order to meet global investors’ evolving demand for exposure to more markets and strategies.
Foto: Mike Mozart. Cambios en el equipo directivo de Bank of America
Bank of America Chief Executive Officer Brian Moynihan this Wednesday announced changes to the company’s management team.
“The quarterly results we announced last week showed once again how far we have come on our journey over the past few years,” Moynihan said. “The changes we are announcing reflect decisions two senior leaders have made about their own futures, and some other changes that will bolster, and in some cases, reposition members of the management team.”
Chief Financial Officer Bruce Thompson has decided to step down after 5 ½ years as chief risk officer and chief financial officer. Global Human Resources Executive Andrea Smith will assume a newly created position as chief administrative officer. Vice Chairman David Darnell has decided to retire by the fourth quarter, after more than 35 years with the company.
Paul Donofrio, who has been with Bank of America since 1999 and has 25 years of global corporate and investment banking experience, will become CFO, effective August 1.
“As CFO, Bruce has put our company on a strong, stable financial foundation, with record levels of capital and liquidity,” said Moynihan. “David is mentor and friend to me, our management team, and so many leaders of our company, past and present. On behalf of all of us, I thank both David and Bruce for their friendship and leadership.”
Prior to being named Strategic Finance Executive for Bank of America, serving as CFO of Consumer Banking and Global Wealth and Investment Management (GWIM), Donofrio was co-head of Global Corporate and Investment Banking, co-head of Global Investment Banking, and head of Global Corporate Banking. Thompson will assist Donofrio and remain on the management team until the end of the year.
Smith, who joined Bank of America in 1988, is taking on a broad portfolio of responsibilities that reflect her deep understanding of the company and her management expertise. As CAO, she will be responsible for Global Corporate Strategy; the company’s market president and enterprise business and community engagement organization; Legacy Assets and Servicing; Global Corporate Services; and Corporate Security, Executive Protection and Aviation.
Smith also will partner with Terry Laughlin and begin a transition of responsibility for the company’s annual Comprehensive Capital and Review (CCAR) submission and Global Resolution and Recovery Planning (GRRP). Laughlin remains responsible for the resubmission of the 2015 CCAR. To ensure a smooth transition, Laughlin will continue to partner with Smith to drive the spring 2016 CCAR submission.
Replacing Smith as Global Human Resources executive is Sheri Bronstein, who will join the management team and report to Moynihan. Bronstein has been the human resources executive for the company’s Global Banking and Global Markets businesses. In her 15 years as a senior human resources executive, she has held leadership roles supporting several lines of business, and is a member of the company’s Global Diversity and Inclusion Council.
Darnell, who currently oversees GWIM, plans to retire in the fourth quarter of this year. Upon Darnell’s retirement and after the company’s 2015 CCAR submission work is completed, Terry Laughlin will assume responsibilities as leader of GWIM and be appointed vice chairman.
Laughlin, who is currently president of Strategic Initiatives, has held various senior leadership positions with Bank of America and Merrill Lynch, including serving as chief risk officer for Bank of America, and chairman and chief executive officer of Merrill Lynch Bank & Trust.
In addition to the management changes announced above, Moynihan announced three senior executives will receive new titles in line with the evolution of their responsibilities.
Anne Finucane is appointed vice chairman and continues as the company’s global chief strategy and marketing officer.This reflects additional responsibilities Finucane has recently taken on for general oversight of the company’s corporate governance process, working closely with the Board of Directors in governance matters and outreach to stockholders in the area of corporate governance practice.
Cathy Bessant remains head of the company’s technology and operations areas.The position is re-designated chief operations and technology officer, effective immediately.
Gary Lynch continues to serve as global general counsel and is appointed vice chairman.
Photo: A Guy Taking Pictures. Aberdeen Launches Multi-Asset Fund
Aberdeen Asset Management has launched the Aberdeen Global – Multi-Asset Income Fund to be managed by its Edinburgh-based Multi-Asset Income Team. Share classes of the Luxembourg-domiciled UCITS fund are registered for public distribution to investors in Belgium, Czech Republic, Hungary, Luxembourg, Netherlands, Switzerland and Singapore (restricted to Qualified Investors).
The Fund is designed to address the increased demand for multi-asset investment products and the challenges that investors are facing when they seek income in the current low rate environment. It combines a broad range of high quality income-generating assets with the aim of producing a high, but sustainable, annual yield while maintaining the real value of capital over the medium term.
The eight-strong Multi-Asset Income team will manage the fund. The team will also draw on knowledge and research from the broader 60-strong Investments Solutions division.
The Fund’s strategic asset allocation is determined by the yield expectations of a range of assets and reviewed on a regular basis. Throughout this process, the focus is on creating a diversified portfolio of high quality income-generating assets.
Mike Turner, Head of Multi-Asset at Aberdeen Asset Management, comments: “In the post-financial crisis world, income is harder to come by. Using our team’s extensive experience in multi-asset investment, we aim to provide a product which can deliver a sustainable annual yield while maintaining the real value of investors’ capital over the medium term.”
Aberdeen’s Investment Solutions division currently manages over €129 billion in multi-asset portfolios on behalf of clients around the world.
Kevin Choy, Portfolio Manager. Pioneer Investments Strengthens Alternative Fixed Income Team
Pioneer Investments announced the enhancement of its Alternative Fixed Income team with the appointment of Kevin Choy as Portfolio Manager. Based in Boston, Kevin will report directly to Thomas Swaney, Head of Alternative Fixed Income, U.S.
In his role, Kevin will work alongside Thomas to support the management of Pioneer Investments’ liquid alternative strategies, including the Long/Short Bond strategy and Long/Short Opportunistic Credit strategy.
Ken Taubes, Head of Investment Management U.S., commented: ‘’In an environment of lower expected returns from bonds, combined with a potential rise in volatility, we need to consider a different way of investing that targets new sources of returns, downside risk mitigation, and volatility management. Liquid alternative strategies aim to provide diversification, improve risk-adjusted returns, and act as shock absorbers during times of market stress,’’ he continued. “They’re potentially also a way to reduce correlations versus traditional asset classes.’’
Taubes added: ‘’We are pleased to welcome Kevin to the team and his appointment represents a further commitment to our capabilities in the growing alternative fixed income area.’’
Kevin joins Pioneer Investments from Hartford Investment Management, where he was a Senior Analyst covering a variety of sectors, including telecom, media and technology. Before joining Hartford he was a Senior Analyst at OFI Global Asset Management, where he generated long and short investment ideas for both retail and institutional investment mandates. Kevin also held positions at NEC Corp. in Tokyo, Japan and the U.S. Kevin has a B.S. in Business Administration with a concentration in Accounting from San Jose State University. Kevin also has an M.B.A. from the Massachusetts Institute of Technology. He is a CFA charterholder.
As a more unique insight to their Liquid Alts efforts, Thomas Swaney will be a key presenter speaking on Long / Short Opportunistic Credit when he visits Miami for a due diligence event Pioneer is hosting in early October. For more detail on this upcoming event, please post the contact: US.Offshore@pioneerinvestments.com.
Maurice Obstfeld - Foto cedida. El FMI designa economista jefe a Maurice Obstfeld, hoy consejero de Obama
Ms. Christine Lagarde, Managing Director of the International Monetary Fund (IMF), this week announced her intention to appoint Professor Maurice Obstfeld as Economic Counsellor and Director of the IMF’s Research Department. Mr. Obstfeld succeeds Olivier Blanchard whose retirement was announced previously. He is expected to begin his work at the Fund on September 8, 2015.
“I am thrilled to have Maurice join us at the Fund. His outstanding academic credentials and extensive international experience make him exceptionally well placed to provide intellectual leadership to the IMF at this important juncture. He is known around the globe for his work on international economics and is considered one of the most influential macroeconomists in the world,” Ms. Lagarde said.
A Professor of Economics (and former Chair of the Department of Economics) at the University of California, Berkeley, Mr. Obstfeld has advised many governments and consulted at central banks all over the world. He is currently serving as a member of President Obama’s Council of Economic Advisors, on leave from Berkeley.
Mr. Obstfeld is the co-author of two seminal textbooks on international economics—Foundations of International Macroeconomics with former IMF Economic Counsellor Kenneth Rogoff, and International Economics with Paul Krugman and Marc Melitz—as well as more than 100 research articles on exchange rates, international financial crises, global capital markets, and monetary policy. Among his many honors are the John von Neumann Award, the Bernhard Harms Prize, and the Tjalling C. Koopmans Asset Award of Tilburg University.
Mr. Obstfeld received his Ph.D. in economics from MIT in 1979 after earning a B.A. from the University of Pennsylvania and an M.A. from Cambridge University. He joined Berkeley in 1989 as a professor, following appointments at Columbia (1979–1986) and the University of Pennsylvania (1986–1989). He was also a visiting professor at Harvard from 1989 to 1991.
Mr. Obstfeld has also held numerous honorary and advisory positions in academia and the public sector. He served from 2002 to 2014 as an honorary advisor to the Bank of Japan’s Institute of Monetary and Economic Studies, and is a Fellow of the Econometric Society and the American Academy of Arts and Sciences. He has served both on the Executive Committee and as Vice President of the American Economic Association. He has also been a Research Fellow at the IMF on four separate occasions, most recently in 2012.
“The position of Economic Counsellor is of fundamental importance to the IMF’s ability to provide its global membership with the best possible independent analysis and policy advice. I am confident that we have found an exceptional candidate in Maurice to take this work forward,” Ms Lagarde said.
