Few investors will look back on the first quarter fondly. Weak economic data fanned recession fears, causing major stock market indexes to plunge by more than 10 percent in the first six weeks, only to recover that ground by the end of the quarter. The dollar, which many expected to keep rising, tumbled; emerging markets, which many had left for dead, rallied.
The volatile period may be anything but an exception. The global economy remains barely above stall speed. Quantitative easing and low to negative interest rates are helping to sustain asset prices even as concerns grow that central bankers have exhausted their tool kits.
“It’s no longer clear-cut that an expansionary monetary policy is positive for markets,” says Mathias Mueller, CIO of multiasset active allocation strategies at London-based Allianz Global Investors. “I think we have come to an end when it comes to the rate cycle.” An end, perhaps, but the beginning of an upturn in rates is not in sight, he adds: “We do not expect the European Central Bank to become less accommodative any time soon.”
Today’s climate places tough demands on investors, but many are rising to the challenge. We highlight some of the top performers with our 2016 European Investment Management Awards.
Institutional Investor screened leading European money managers based on performance and risk data from fund information provider eVestment, then consulted with European fund sponsors to determine the winners (listed in the table, below). We also honor leading pension funds, based on our own review of the funds’ performance, strategy and leadership in the investor community. See below for profiles of the winners.
2016 European Investment Management AwardsPan-Europe Core EquitySchroder Investment MgmtPan-Europe Growth EquityFidelity InternationalPan-Europe Value EquityAcadian Asset MgmtPan-Europe Large-Cap EquityUBS Asset MgmtPan-Europe Small-Cap EquityStandard Life InvestmentsPan-Europe Core Fixed IncomeAXA Investment ManagersPan-Europe Corporate Fixed IncomeRobeco Institutional Asset MgmtPan-Europe High YieldStone Harbor Investment PartnersU.K. Core EquityKames CapitalU.K. Growth EquityColumbia Threadneedle InvestmentsU.K. Value EquityLindsell TrainU.K. Large-Cap EquityJupiter Fund MgmtU.K. Small-Cap EquityLiontrust Asset MgmtU.K. Core Fixed IncomeStandard Life InvestmentsU.K. Corporate Fixed IncomeRoyal London Asset MgmtEmerging-Markets EquityHermes Investment MgmtFrontier-Markets EquityAcadian Asset MgmtEmerging-Markets Local DebtInvestec Asset MgmtEmerging-Markets Hard Currency DebtPioneer InvestmentsGlobal Unconstrained Fixed IncomeAmundiGlobal BalancedAllianz Global InvestorsETF Manager of the YearBlackRock iSharesSmart-Beta manager of the yearAQR Capital MgmtESG manager of the yearRobecoSAMInfrastructure manager of the yearMacquarie Infrastructure and Real AssetsHedge FundsTCI Fund MgmtNicholette MacDonald-Brown, head of research and a portfolio manager at London-based Schroder Investment Management, winner in Pan-Europe Core Equity, says European stocks offer attractive valuations but face near-term risks, including the U.K.’s June referendum on European Union membership. For long-term investors “it’s an excellent time to buy European equities,” she contends.
A surge in corporate bond issuance is giving investors more alternatives to sovereign bonds and an illiquid secondary market, says Anne Velot, head of the €10 billion ($11 billion) Active Euro Credit strategy at London-based AXA Investment Managers, winner in Pan-Europe Core Fixed Income. “The credit premium is very, very attractive relative to government rates,” she says.
The search for yield has lit up few areas as it has infrastructure. Arthur Rakowski, chairman of the investor solutions committee at Macquarie Infrastructure and Real Assets in London, recalls that he had to push his way onto investment conference panels in the early 2000s to make the case for infrastructure when the Australian firm was raising its first European fund. Four Macquarie funds and more than €10 billion later, the field is crawling with competitors. “You name it, there is probably a fund manager doing it,” Rakowski says. “We need to convince people that our strategy is better.”
The same can be said of sustainability. The climate-change agreement at the United Nations conference in Paris in December has put environmental, social responsibility and corporate governance issues on the radar screen for investors around the world. “We are in a phase where this is moving into the mainstream,” says Daniel Wild, head of sustainability investing research and development at Zurich-based RobecoSAM, winner in ESG investing. “Now you’re playing with the big guys. You have to show a risk-return profile.” •
2016 European Money MastersClick below to view profiles.
| Investor Lifetime AchievementRoger GrayUniversities Superannuation SchemeGermanyStefan HentschelEvonik IndustriesU.K. CorporateTony BroccardoBarclays UK Retirement FundCentral and Eastern EuropeKatrin RaheSwedbank Investment Funds |
| Manager Lifetime AchievementPascal BlanquéAmundiNetherlandsMark BurbachBlue Sky GroupSmall CountriesPaul DroopBank of IrelandFranceSalwa Boussoukaya-NasrFonds de Réserve pour les Retraites |
| SwitzerlandAdrian RyserMigros-PensionskasseU.K. PublicMark LyonEast Riding Pension FundScandinaviaHenrik Olejasz LarsenSampension |
