Asset management has plenty of choice to offer investors, in terms of procedure, products, partners and processes. But alongside these factors, the investor must also examine the areas of product communication and distribution.
Investment companies – a potential bridge-builder to institutional investors?
“The grass is always greener on the other side of the fence”, and of course providers of SRI products are very keen to get access to institutional investors.
Regulation, investment restrictions on institutional investors, the appropriate product structure and fund fees are all issues that arguably better discussed in respect to closed-end funds.
Some fund investors in the asset management sector with public funds and family offices, and the relevant providers of closed-end funds in the SRI category have discussed these issues at length: What is the appropriate approach by institutional investors to open such doors?
Investment companies in the private label funds sector are concerned.
Whether it be Universal Investment, Hauck & Aufhauser, IP Concept or AmpegaGerling, they are receiving an increased number of requests from these areas. Even companies like DWS, Deka and Union Investment are in intensive dialogue with providers and with investors.
The product shell – a possible fundamental building block for the success of products
It is fair to say that in the final analysis, the underlying investment for SRI investments does make the difference.
When speaking with many product providers or project initiators their ideas about the needs of institutional investors often comes out in broad daylight.
Some providers of closed-end funds have inadequate contact and experience of the institutional investors.
On the other hand, many institutional investors have a hard time with the world of prospectuses and ‘transparency’ when it comes to the field of closed-end funds.
For each closed-end fund prospectus, for example, an investor must dig through all the details.
This could be quite an incentive for ratings agencies to work on a new field, in a serious way. On the other hand, an opportunity exists for traditional asset management consultants to use their ability or know-how in the field of SRI and the SRI fund system.
Who possesses an insight into the difference between a special fund under Part II (Luxembourg), SICAR, SIF, and ‘other fund’?
Who can advise on whether the closed-end funds category is perhaps the more appropriate path, or whether a loan is the best solution?
Or maybe the best choice is ultimately elsewhere, with open-ended mutual funds…