Foto: DiNo
. Perú acogerá la reunión anual del Banco Mundial en octubre
The Peruvian Minister of Economy and Finance Alonso Segura officially announced that the Annual Meeting of the World Bank will take place in Lima, Peru this October. He was joined by President of the World Bank Jim Yong Kim; Managing Director of the IMF Christine Lagarde and the President of the Peruvian Central Bank, Julio Velarde.
It is the first time in 48 years that the Annual Meeting will be held in Latin America, emphasizing the great progress that Peru and the region have made in their economic sectors. Over 15,000delegates and representatives are expected to attend this meeting from the 9th-11th October 2015. The construction of a new convention centre is nearing completion and hundreds of new hotel rooms are being made available for this event.
Mr. Velarde noted the good micro economic policies that the Peruvian government has implemented during the last few years in light of the fall in government earnings due to the decline in commodity prices. Peru was chosen as the location for the summit due to the country’s growth, which has averaged 6.4% annually over the past decade.
Foto:SpeedPropertyBuyers. JP Morgan Asset Management lanza una plataforma de inversión en activos reales
J.P. Morgan Asset Management Global Real Assets has launch Tactical Direct Investments(“TDI”), a dedicated cross-real assets group to help further meet client demand for direct and co-investment real asset opportunities across the risk/return spectrum and around the world.
Global Real Assets (GRA) currently manages or advises more than $17 billion of direct and co-investment transactions globally on behalf of clients. The new unit, a dedicated cross-real assets group within GRA,will be under the leadership of Avik Mukhopadhyay.
“Institutional investors are increasingly seeking to complement their real asset fund holdings with direct investments. However, for both the investor and the investment manager, direct investing is fundamentally different from fund investing,” said Joe Azelby, Global Head of Real Assets.
Avik Mukhopadhyay said, “In many ways, Tactical Direct Investments is leveraging what the group has been doing exceptionally well for more than four decades. And by creating a dedicated team focused on providing bespoke investment solutions – be it co-investments, direct single asset transactions or thematic separately managed accounts – for clients across real estate, infrastructure and maritime/transports globally, we hope to both deepen our relationships with existing clients and help new clients achieve their individual goals.”
CC-BY-SA-2.0, FlickrFoto: Ryan McKee
. Ben Bernanke participa como ponente destacado en INSITE 2015, que este año cambia su sede habitual
The annual event for advisors – investment professionals, RIAs, dually registered and hybrid advisors as well as senior-level product and marketing executives- hosted by Pershing will take place June 3-5 at The Hyatt Regency Orlando in Florida. The factors that are rapidly redefining today’s business environment for advisors, broker-dealers and other professionals in our industry to exam: The growth of global wealth, new and wide ranges of investment solutions, changing client expectations and other important developments in the marketplace.
INSITE 2015 will feature nearly 40 sessions around technology, regulation and practice management. Keynote speakers include Madeleine K. Albright, the first woman to be named Secretary of State of the United States and Chair of Albright Capital Management; Dr. Ben S. Bernanke, two-term chairman of the Board of Governors of the Federal Reserve System; Derek Jeter, a five-time World Series champion and New York Yankees captain. Mr. Jeter is pursuing philanthropic and entrepreneurial ventures; Leon E. Panetta, the 23rd Secretary of Defense and former Director of the Central Intelligence Agency.
Presentations and sessions will center on: Management and Protection of Clients’ Wealth; Positioning Yourself for Growth; Rev Up Retirement Practices; How to Stay Ahead of the Regulatory Curve and Transformation Through Technology.
CC-BY-SA-2.0, FlickrFoto: The Tax Haven. ¿Triunfar en el largo plazo? No siga a la masa
It’s human nature to follow the pack whether people find safety in numbers or fear they’ll miss an opportunity others are enjoying. For your clients as investors, however, joining the pack might do more harm than good. It could mean they’re jumping in and out of the market at the wrong times, causing irreparable damage to their long-term returns. Or the pack might take them where they don’t belong — into higher risk or “hot” products that don’t match their investment goals.
Let the ship sail
As advisors, you know all too well how investors run toward the strongest performance and run from the weakest. They want to win. They don’t want to lose. In reality, though, by the time most investors decide to dive into a fund or abandon a sinking ship, they’re already in troubled waters. More often than not, pack-driven investing results in buying close to market peaks and selling at market troughs; it rarely leads to sustainable returns.
In fact, during the global financial crisis of October 2007 to February 2009, $208 billion flowed out of equity funds during the last 12 months of the downturn, and from March 2009 to December 2013, $161 billion flowed into equity funds during the last 12 months of the rebound. Those investors would likely have been better off in funds with longer views and high-quality portfolios designed for less volatility in choppy markets. Of course, many investors who stayed the course and continued making contributions throughout the downturn also had some good growth in their accounts due to the simple but powerful benefits of dollar-cost averaging.
Turn down the trends
For investors, trends can be tempting and tough to ignore. Whether it’s the promise of better returns in exotic fixed-income strategies designed to combat a low interest rate environment, or a new “uncorrelated” asset class for those who think equities have run their course, products like liquid alternatives and unconstrained bond funds are entering the market in waves. But these products can be complicated — and expensive. As evidence, the average expense ratio for alternatives is 1.71%, compared to 0.74% for equity funds. For an unconstrained bond fund, the average expense ratio is 1.15%, compared to 0.81% for core bond funds.
Are these costs justifiable? Do these products truly align with your clients’ long-term goals, or is the appeal performance-driven? As an advisor, are you confident that the investment managers have the relevant expertise — in derivatives, for example, given that many liquid alternatives use leverage to boost returns? Just because investment managers can bring new products to market, doesn’t necessarily mean they should. The best companies in this business will only bring to market products where they see promise in the long-term value proposition of an asset class and where they have the requisite expertise and resources in place to deliver on that promise.
More importantly, there are always opportunities in traditional equity and fixed income if you’ve got a skilled active management team to find them. I’d suggest this is as true now as ever, especially as we continue to see more market volatility. That’s when active management provides the greatest opportunity to differentiate returns. That’s when good research pays off. And that’s when focusing on solid fundamentals, which truly drive value and sticking with your convictions, regardless of short-term momentum, provide the most meaningful opportunities for clients.
To get your clients to leave the pack mentality behind, take a page from the playbook of active managers. They purposely turn away from the pack — in this case their benchmark — avoiding full market risk and choosing the risks they take intentionally. Think of it this way: If everyone is fishing in the same pond, they’re all swayed by the same tide and they’re after the same catch. So it stands to reason, if you fish somewhere else and know where to look, you can reel in opportunities that others are missing.
James Jessee is Co-head of Global Distribution at MFS Investment Management. His comments, opinions and analyses are for informational purposes only and should not be considered investment advice or a recommendation to invest in any security or to adopt any investment strategy. Comments, opinions and analyses are rendered as of the date given and may change without notice due to market conditions and other factors. This material is not intended as a complete analysis of every material fact regarding any market, industry, investment or strategy.
CC-BY-SA-2.0, FlickrLuis Téllez - Courtesy photo. Luis Téllez Appointed Senior Advisor for KKR in Mexico
The investmentfirm KKR announced the appointment of Luis Téllez, former Chairman of the Board and CEO of The Mexican Stock Exchange (Bolsa Mexicana de Balores, BMV), as a Senior Advisor to the firm, effective immediately.
Mr. Téllez has been active in public service for over 20 years, being involved in macroeconomic, financial, energy and agricultural issues. Specific roles include serving as Secretary of Communications and Transportation (2006-2009), Secretary of Energy (1997-2000) and Chief of Staff to President Ernesto Zedillo (1994-1997). Téllez was also Deputy Secretary of Agriculture and Head Economist at the Treasury.
He is the former Chairman of the Board and CEO of the MSE where served for the last five years. Prior to MSE, he was Managing Director of the Carlyle Group in Mexico (2003-2006) and Chief Executive Officer of Desc (2001-2003), one of Mexico’s largest industrial and real estate companies.
Commenting on the appointment, Alex Navab, Head of KKR’s Private Equity business in the Americas, said: “Luis Téllez has had a distinguished career in both the public and private sector, and we are pleased to have him as an advisor to KKR. We believe that both investors and companies in Mexico are looking for partners to aid their growth and investment objectives and Luis Téllez will offer valuable insights that support those endeavors and help grow our franchise in Mexico.”
“KKR is known as a pioneering, innovative investment partner with a terrific long-term track record. I am honored to work with an iconic firm that has demonstrated its long-term interests in such an important economy as Mexico,” Luis Téllez said.
Mr. Téllez has been a member of the board of FEMSA, Grupo México, BBVA Bancomer, Cultiva and Global Industries. He currently serves as a Director of Sempra Energy (San Diego based utility) and is the Mexican Associate of McLarty Associates. Téllez is also member of several non-profit organizations such as the Mexican Council of Foreign Affairs.
CC-BY-SA-2.0, FlickrFoto: smlp.co.uk
. El Departamento de Trabajo de Estados Unidos obligará a los asesores a primar los intereses de sus clientes
The U.S. Department of Labor has released a proposed rule that will protect 401(k) and IRA investors by mitigating the effect of conflicts of interest in the retirement investment marketplace. A White House Council of Economic Advisors analysis found that these conflicts of interest result in annual losses of about 1 percentage point for affected investors — or about $17 billion per year in total.
Retirement advisors–including brokers, registered investment advisors (RIAs), bankers, insurance agents and lawyers among others- will be required to put their clients’ best interests before their own profits. Those who wish to receive payments from companies selling products they recommend and forms of compensation that create conflicts of interest will need to rely on one of several proposed prohibited transaction exemptions.
“This boils down to a very simple concept: if someone is paid to give you retirement investment advice, that person should be working in your best interest,” said Secretary of Labor Thomas E. Perez. “As commonsense as this may be, laws to protect consumers and ensure that financial advisors are giving the best advice in a complex market have not kept pace. Our proposed rule would change that. Under the proposed rule, retirement advisors can be paid in various ways, as long as they are willing to put their customers’ best interest first.”
The proposal would expand the number of persons who are subject to fiduciary best interest standards when they provide retirement investment advice and would require enter into a contract with their customers in which they commit to fundamental standards of impartial conduct. These include giving advice that is in the customer’s best interest and making truthful statements about investments and their compensation.
The landscape has dramatically changed in the last 40 years. The share of working Americans covered by traditional pension plans— which offer a guaranteed income stream in retirement— has fallen sharply. Today, most workers participating in a retirement plan at work are covered by a defined contribution plan, such as a 401(k). Importantly, the income available in retirement from a defined contribution plan depends on both the amount initially saved and the return on those savings. Collectively, more than 40 million American families have savings of more than $7 trillion in Individual Retirement Accounts (IRAs). More than 75 million families have an employer-based retirement plan; own an IRA, or both.
CC-BY-SA-2.0, FlickrFoto: Roger Schultz
. BancTrust y el broker argentino Global Trading Desk anuncian una joint venture
BancTrust & Co. and the Argentinean Global Trading Desk, S.A. (GTD) have signed a strategic Joint Venture to expand the investment bank’s local presence throughout the Americas.
Among the Joint Venture’s highlights is its market Research Products built specifically for the region, as well as its Fixed Income trading platform, which is the “heart” of the services offered to local banks and asset managers.
“I’m honored to say that GTD Argentina has entered into an agreement with BancTrust & Co. with the purpose of better serving clients in the region through our offices in Buenos Aires,” states Alejandro Bueno, CEO of GTD Argentina.
Carlos Fuenmayor -Founder, Chairman & CEO of BancTrust & Co. Holdings- affirms “I’m excited about this new partnership with Mr. Bueno and his team at GTD that will allow us to offer local expertise to our investor base interested in the Southern Cone, while continuing to build upon our global reach.”
BancTrust & Co. is a boutique investment banking group dedicated to the Emerging Markets specializing in Latin America. The firm offers Capital Markets, Sales & Trading, Market Strategy and Asset Management products and services through various entities located across The Americas and Europe. As a group of companies, the firm facilitates global market transactions to a diverse client base that includes corporate treasuries, financial institutions, asset managers, and governments and its entities.
Global Trading Desk offers voice-electronic brokerage for financial products and commodities, for both OTC markets and derivatives and real time data over the products negotiated in wholesale. The firm combines experience and technology to generate simple and efficient negotiation processes that help reduce the risks associated to them.
Investors can help reduce their exposure to heavy emitters of greenhouse gasses and fulfil their fiduciary objectives by adapting a green beta investment approach, according to a white paper from Mellon Capital Management.
“Generating a return on capital that meets a benchmark set by institutional investors, while reducing the carbon intensity in a portfolio requires a more nuanced approach than simply eliminating or underweighting business sectors that are heavy carbon emitters,” said Karen Q. Wong, managing director and head of equity portfolio management at Mellon Capital and co-author of the report.
The Mellon Capital paper, Green Beta: Carbon Efficient Investing, notes that investors can take steps to make their portfolios more environmentally friendly even if they retain their exposure to the carbon-intensive sectors of the stock markets. The key, according to Mellon Capital, is to underweight the companies within those sectors that have the highest carbon intensity.
Carbon intensity measures the amount of carbon emitted per unit of revenue. Utilities and energy and materials companies account for more than 75 percent of the overall carbon emissions intensity of the Russell 3000 index, yet just over 16 percent of the index composition, the report said.
“One potential pitfall in pursuit of reducing carbon emissions exposure is to significantly underweight these three sectors, which can introduce unintended sector tilts,” said Wong. “We think it’s better to underweight companies within these sectors that have higher carbon intensity. We would maintain exposure to the sectors as a whole by overweighting companies within the same sectors that are taking a more proactive approach to reducing their carbon emissions.”
The report notes that a truly robust strategy goes beyond the sector level and neutralizes exposures at the industry level. This is particularly important when considering a sector as diverse as consumer discretionary, where an unintended bias can be created between the auto (heavier emissions) and apparel industries (lower emissions), according to the report. Many high carbon intensity companies tend to have lower volatility, larger market capitalizations, relatively high yields and tend to be oriented toward value instead of growth, according to Mellon Capital.
“It’s important to compensate for these exposures if such companies are underweighted to achieve lower carbon exposure,” said William Cazalet, managing director and global investment strategist at Mellon Capital and co-author of the report. “Also, portfolio managers must guard against introducing different types of risks into the management of the portfolio that could occur by lowering exposure to companies with these characteristics.”
BNY Mellon offers a wide range of products and services that help investors meet their return/risk goals, while considering the environmental, social and governance impact of their investments.
OppenheimerFunds has fully staffed its team covering private clients, bank trusts and family offices, reinforcing the Company’s strategic drive to expand its core retail base and increase its capabilities in the ultra-high-net-worth market.
Most recently, OppenheimerFunds hired Nancy Bong as Strategic Account Manager on the team. She and fellow Strategic Account Manager Josean Fernandez have primary responsibility for managing the Company’s relationships with the private banks, national trust companies and regional and super-regional banks that make up OppenheimerFunds’ Strategic Account list.
“Nancy’s addition enhances our strong, experienced team that provides robust service and value for this critical client sector,” said Ned Dane, Head of Private Client, Trust & Family Office.
In addition to Nancy and Josean, there are five Sales Directors who cover trusts, family offices and the local offices of several Strategic Account clients: Joe Stellato (Northeast), Tom Winnick (Mid-Atlantic), Justin Goldstein (Southeast), Chris Saul (Central) and Matt Brown (West).
Nancy joins OppenheimerFunds from Neuberger Berman, where she managed relationships with clients in the Private Bank and Trust channel. Previously, she worked at Lehman Brothers and Goldman Sachs. Nancy received her undergraduate degree from Queen’s University School of Business in Canada and her MBA from Harvard Business School. She is a CFA® charterholder and has her CAIA designation. Nancy is based in New York.
“Under Ned’s leadership, OppenheimerFunds is well positioned as a trusted, consultative advisor, aligned to meet the evolving needs of this essential client group,” said John McDonough, Head of Distribution.
CC-BY-SA-2.0, FlickrFoto: Tony Hisgett. Wells Fargo y Blackstone firman un mega acuerdo para adquirir la cartera inmobiliaria de GE Capital por 23.000 millones de dólares
Blackstone and Wells Fargo announced that they had signed agreements to purchase most of the assets of GE Capital Real Estate in a transaction valued at approximately $23 billion.
The transaction breaks down as follows:
Wells Fargo has agreed to purchase performing first mortgage commercial real estate loans valued at $9.0 billion in the United States, UK and Canada.
Blackstone’s latest flagship global real estate fund, BREP VIII, has agreed to purchase the US equity assets for $3.3 billion. These assets are primarily office properties in Southern California, Seattle and Chicago.
Blackstone’s European real estate fund, BREP Europe IV, has agreed to purchase the European equity real estate assets, for €1.9 billion. These consist of office, logistics and retail assets, largely in the UK, France and Spain. The logistics assets will be integrated into Blackstone’s European logistics platform, Logicor, and the retail assets into its European retail platform, Multi.
BREDS, Blackstone’s real estate debt fund, has agreed to purchase performing first mortgage loans in Mexico and Australia for $4.2 billion.
BXMT, Blackstone’s publicly traded commercial mortgage REIT, has agreed to purchase a $4.6 billion portfolio of first mortgage loans primarily in the US with Wells Fargo providing the financing.
Eastdil Secured/Wells Fargo Securities acted as advisor to Blackstone and Wells Fargo. Simpson Thacher & Bartlett LLP acted as legal counsel to Blackstone and Dechert LLP acted as legal counsel to Wells Fargo.
GE Capital was advised by Kimberlite Group and BofA Merrill Lynch and represented by Hogan Lovells.
Mark Myers, Head of Commercial Real Estate for Wells Fargo, said, “This is an important transaction in the commercial real estate industry and Wells Fargo is pleased to be working with our colleagues at GE Capital and Blackstone. The portfolio of performing loans we’ve purchased is a strong addition to our commercial real estate platform in the United States, the United Kingdom and Canada, which are all active lending markets for us.”
Jon Gray, Global Head of Real Estate for Blackstone, said, “We are delighted to partner with GE on another major transaction and we thank them for their confidence in us. We also thank Wells Fargo for our longstanding relationship, and for their swift execution on this investment. This transaction clearly demonstrates the unique scale and reach of our real estate platform.”
These transactions are subject to normal regulatory and other approvals. The initial closings will take place in the second and third quarter of the year.
