Absolute return will be the investment strategy to receive the greatest increase in assets in 2012, according to a survey of buy-side institutions by technology provider SunGard and the Professional Risk Managers’ International Association.
Of 388 industry participants, which included asset managers, pension funds and regulators, 21% said they expected to see an increase in assets allocated to absolute return strategies, while 19% expected an increase in assets for emerging market equities and 17% an increase for liability-driven investments.
Absolute return strategies seek to deliver positive returns in all market conditions. They are typically multi-asset funds that may use instruments such as derivatives to minimise volatility and minimise their losses in down markets.
The respondents were also asked about risk management, with 85% saying it will play an increasingly important role in their organisations. Commercial factors may drive the change, with 80% saying transparent risk management is increasingly important for attracting new investments.
©2012 funds europe
