Uncategorized Archives | With Intelligence
15 Jun 2022

UBS tops European prime broker ranking 

Morgan Stanley still top by manadates, but drops behind Swiss bank client assets

UBS has overtaken Morgan Stanley as the leading prime broker in Europe by market share, though the US bank remains top by client numbers. The Swiss bank ended 2021 with a hedge fund book in the region worth $77.6bn in AuM, up 10% from $70.4bn a year earlier. Morgan Stanley rose 4% from $73.9bn to $76.7bn over the 12-month period.

Morgan Stanley has the most client relationships, with 62 sole and 217 shared mandates, ahead of UBS’s 54 sole and 162 shared. UBS increased its mandate numbers from 41 sole and 154 split mandates last year.

Goldman Sachs rose one place to third, with $63.8bn in client assets, up a significant 24% over the year, across 44 sole and 160 shared mandates.

The changes in the rankings reflect recent shake-ups in the prime brokerage world. Credit Suisse, which was third by client assets last year, is closing its prime brokerage business following the implosion of family office client Archegos Capital Management and dropped to sixth in what should be its final appearance on the list. It announced the closure in November and said it would refer clients to BNP Paribas, thirteenth on the latest list. 

The French lender’s position was unchanged despite striking a separate referral deal with Deutsche Bank in September 2019 after the latter said it was pulling back from prime broking. The German bank remains on the list, having dropped from eighth to tenth by client assets, as reporting catches up with the completed transfer of clients, technology and key staff to BNP at the end of 2021.

JP Morgan, the third of the US ‘big three’ in prime brokerage, benefits from Credit Suisse’s drop and rises two places to fourth. It recorded the biggest growth of the main players, with client assets up 46% to $61.1bn in the year. HSBC holds onto fifth position after registering 30% growth. JP Morgan is the top prime broker to new funds by client assets, though its 11 mandates was fewer than Morgan Stanley (14), UBS (15) and Goldman Sachs (16).

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Top managed account platforms 2021

HedgeMark extends lead ahead of Innocap takeover

BNY Mellon’s HedgeMark grew its lead as the top managed account platform provider last year, increasing assets under management by more than a third to $40.5bn. HedgeMark, which is being acquired by Innocap Investment Management, has topped the list since 2019 when the methodology was adapted. The eight-strong list oversaw assets worth $117.4bn at the end of 2021, a 26% increase, demonstrating a strong industry demand for managed account products during the global pandemic. The annual asset increase outstrips the 10.5% performance gain posted by the average hedge fund last year.

Canada-based Innocap announced the HedgeMark takeover in February and it is subject to regulatory approval. BNY Mellon will keep a minority share. All eight constituents on the list grew platform assets in 2021. Paris-based Lyxor Asset Management in second place increased assets by $4bn to $26.9bn, putting it $13.6bn behind. Man FRM grew by $1.9bn to $21.5bn in third. 

 

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How Can Fund Managers Leverage Data to Improve ESG Practices?

As the demand for ESG data continues to increase, this panel discussion how explore how fund managers:

The role of data analytics and AI in improving research and engagement.

Data acquisition – the growth of data sets and how to benchmark service providers.

Data for improved portfolio management – how can fund managers use data to improve the ESG performance of portfolio companies?

How can alternative data sets be used to better understand the impact of ESG on portfolios?

Data applications for business – how can data management platforms help support internal ESG initiatives?  

Speakers

Ken Read, CRO, BipSync

Adam Lewicki, Chief Risk Officer, Head of Quantitative Strategies, Carlson Capital

Megan Herzl, Senior Content Manager, With Intelligence – Moderator

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DE&I as an Enabler for Improved Operational Performance & Investment Opportunities

With Intelligence ESG Symposium | 28 April 2022

As diversity, equity and inclusion becomes an increasingly topical conversation within boardrooms, this panel discussion will explore:

Benefits of team diversity – diverse teams as an enabler for improved operational and financial performance.  

Recruiting and retaining diverse talent – providing managerial training, team building activities and work from home initiatives.

Overcoming bias – leveraging NLP technology for improved screenings of applicants during the recruitment process. 

SEC guidance and recommendations for diversity & inclusion.

Speakers

Sara Schroeder, SVP, People and Development, Backstop Solutions

Jacqueline Taiwo, Co-Founder & CEO, Black Women in Asset Management (BWAM)

Paul Thompson, Founder, LGBT Capital

Rima Sen, Director, Credit Management Research, WTW

Sam Patmore, Senior Content Manager, With Intelligence – Moderator

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Women's Private Equity Summit

The Transition to Net Zero and More Sustainable Ways of Business

This panel discussion will explore various government initiatives and standards set out by regulators to encourage greater sustainability within businesses, and additional strategies to improve business sustainability.

Topics of conversation include:

  • How have the recent events have impacted the global transition to Net Zero?

  • Should frameworks be designed at a company/industry or even country level

  • What is needed from frameworks and business for further harmonisation?

  • We have moved from narrative to action, now its time for accountability, what should hedge funds now be doing in terms of accountability?

  • Case study examples of how the goal of Net Zero into business pratices

Speakers

  • Tim Lord, Head of Climate Change, The Phoenix Group

  • Carlos Arcila-Barrer, Founder & CIO, Sigma Advanced

  • Eliot Whittington, Director of Corporate Leaders Groups, Cambridge Institute for Sustainability.

  • Carmen Bamford, Head of Event Content, With Intelligence – Moderator

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Texas Teachers hunts tech-focused emerging HFs

The $204bn system is also building a premier list of EM program advisers

Connor Owen
22 FEB 2022

The Teacher Retirement System of Texas (TRS) will assess tech-focused equity hedge funds and long-only opportunities this year within its emerging manager program.

The $204bn system’s technology sector search initiative will be a key area of focus for its emerging manager program in 2022, Kirk Sims, emerging manager director, shared as part of his annual program updates.

Texas Teacher’s emerging manager program is valued at $2.5bn, of which $527m is allocated to public markets, as of September 2021. The half-billion allocation includes both long-only equities and hedge fund strategies, such as credit, equity long/short, event-driven and equity market-neutral.

The sole requirement set by TRS for prospective emerging managers in public markets strategies, including hedge funds, is to have an AuM lower than $3bn. Initial manager allocations are typically in the $10m to $30m range.

TRS partners with The Rock Creek Group to oversee the public markets side of its emerging manager program, which first opened to hedge fund managers in 2011.

In addition to sourcing tech sector hedge funds for the program, TRS will look to promote existing emerging managers into its main investment portfolio with significantly larger allocations.

The qualifying criteria for a transitional capital program for hedge funds and long-only emerging managers, termed EM Select, was established in collaboration with Rock Creek last year. Managers have been ranked, and two top-tier candidates are in due diligence, Sims shared.

Finally, TRS’ emerging manager team also conducted a deep dive review of their existing hedge fund investments last year with respect to portfolio sizing and structure and evaluating prospective emerging managers. It added two new hedge funds as a result but has not yet disclosed identifying information.

Emerging hedge fund managers keen to engage with TRS were given a number of pointers last month by Lulu Llano, who oversees international equities and directional hedge funds in the system’s main investment portfolio.

Llano advised prospective hedge funds to fine-tune their pitch, ensuring they can articulate a clearly defined investment philosophy and process, but also have patience when dealing with large public pensions like TRS.

“We’re slow-moving, so begin to build a dialogue and connections even if you’re not a fit now – if you invest in cultivating relationships, it could open a door in the future,” she said at TRS’ annual emerging manager conference on January 19.

In search of specialist emerging manager advisers

TRS staff are in the process of reviewing the landscape of third-party emerging manager program advisers, surveying firms that offer emerging manager-type programs across public and private market strategies.

Following this review, the system is developing a premier list for emerging manager industry specialists, which would create a bench of available program advisers.

In addition to Rock Creek, the system currently works with GCM Grosvenor as an emerging manager program adviser.

Other emerging manager program advisers in the space include PAAMCO Prisma and Stable Asset Management; both of which have picked up hedge fund-specific mandates from US pensions in recent years.

PAAMCO was selected as the Massachusetts Pension Reserves Investment Management Board’s emerging hedge fund manager lead in December 2021, and is also retained by the Employees Retirement System of Texas for its hedge fund seeding platform.

Meanwhile, Stable was hired as the Los Angeles County Employees Retirement Association’s emerging hedge fund lead in December 2020. Four new managers were onboarded into the program in the third quarter of last year, receiving a combined allocation of $155m.