Top fund executives meeting in Barcelona this week will debate how to attract assets from sovereign wealth investors and the merits of absolute return funds as they face up to a tough environment of lower inflows.
The Fund Forum International 2008, taking place from July 1-3, comes during the asset management industry’s toughest period since the bear market of 2000-2003, as the credit crisis that began last summer and choppy markets hit investor confidence.
“It’s not a great time for new business. People are sitting on their hands,” said Robert Lloyd George, chief executive of Lloyd George Management, which runs $12 billion in Asian and emerging market assets.
“There is a lot of … fear about where the UK economy is going.”
Fund firms profit during bull markets because investors tend to put more money into funds while overall assets, on which they earn fees, rise with markets.
During bear periods fund firms are often hit as markets fall and investors withdraw cash.
Retail fund sales have been poor in recent months. Sales of UK tax-advantaged Individual Savings Accounts (ISAs) in the traditionally busy ISA season were the worst on record this year, although retail fund sales rebounded in April.
Shares of listed fund firms have been battered.
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