Mercer advises on more manager searches worldwide than any other investment consulting firm, this search data is often viewed as a bellwether of trends within the institutional investment market, the firm says.
Last year it advised on 748 manager searches globally, accounting for US$76 billion in assets placed.
It says there was particular growth in search activity in the Europe region.
International equity overtook US equity as the most popular single product categorywith US equity being the second most popular category.
Search activity in Asia remained essentially unchanged from the previous year, with 44 searches in 2005. There was increased interest in global equity mandates, which represented 36.4% of searches, up from 9.3% in 2004. In Australia, investors seeking diversification and higher returns were the primary drivers behind most search activity in 2005. Property was the most popular mandate in Australia.
“Overall, however, 2005 was below average in terms of search activity. In general, clients are satisfied with their current investment manager mix, and strong performance of equity and fixed income markets have given them little reason to reconsider that structure,” Mercer Asia’s Head of Research Marianne Feely says.
In Europe multi-asset and global equity saw the most search activity in the region.
“The number of searches in Continental Europe increased dramatically in 2005 as both our business and the use of consultants continue to grow across the region,” said Andy Barber, European Head of Research at Mercer IC. Ireland saw the most search activity within the region, driven by changes in asset allocation and by the trend away from single-manager balanced structures towards structures seeking global equity exposure.
“While global equity continues to see the most search activity within the UK, the pick-up in private equity searches is striking. This suggests our UK clients are continuing to take a long-term view when deciding on strategic asset allocation.”
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