Insights

• 83% of investors would be more likely to allocate to a specialist investment manager via a multi-affiliate partner
• Almost two-thirds of investors believe the asset management market is lacking specialist investment managers
• Despite multitude of acknowledged appealing characteristics, the majority perceived it to be higher risk to invest in a specialist investment manager over a multi-asset manager
• The multi-affiliate model is favoured for its potential to reduce compliance and regulatory risks, mitigate ESG and greenwashing risk and allow managers to concentrate on making informed investment decisions

London, 26 June 2024 – Fidante the global multi-affiliate investment management business, reveals the key findings of its survey assessing European institutional investor attitudes to allocating to specialist investment management businesses. The survey of 229 European investors demonstrates how the multi-affiliate model is pivotal to institutional investors when making decisions to allocate to specialist managers. 

There is clear appetite for more specialist managers in a saturated asset management market, dominated by larger multi-asset managers. 

Almost 60% of investors surveyed believe that the asset management industry is saturated with large multi-asset investment managers. Almost two-thirds of respondents (64.6%) confirmed that they believe that the market is lacking specialist managers. 

Over 65% of respondents agreed specialist investment managers are more agile from the perspective of being able to capitalise on investment opportunities in their given sector than larger multi asset investment managers investing in the same asset class.

Of those surveyed who would choose to allocate to a specialist manager over a larger multi-asset investment manager, almost a third - 31.9% - were primarily driven by the belief that doing so will provide a “greater chance of achieving better returns”. This same group also elected “deeper experience in an asset class” and “more innovative” as overarching reasons for their choice at 24% and 23.1% respectively.

The survey found that European institutional investors largely perceive specialist investment managers to be ‘higher risk’ than larger multi-asset investment managers. 23.1% of respondents associate specialist investment managers with increased regulatory and compliance risk, 21.8% with an increased ESG compliance risk, and 15.3% with an increased M&A or takeover risk.

The multi-affiliate partner model is seen as able to break down perceived barriers and mitigate perceived risks to allocating to specialist investment managers.

83% of respondents indicated they would be more likely to invest in a specialist manager who is supported by a multi-affiliate investment management partner.

Cited among the main benefits of the multi-affiliate manager structure was the ability to reduce the investment risk associated with specialist investment managers. The multi-affiliate model is favoured for its potential to reduce compliance and regulatory risks (27.4% of respondents), mitigate ESG and greenwashing risk (26.3% of respondents) and allow managers to concentrate on making informed investment decisions (22.1% of respondents).

Adam Brown ,General Manager & Co-Head of Global Distribution at Fidante Partners, reflecting on the findings, said: 

"Institutional investors understand the key advantages of specialist investment managers, from their innovative approaches and deeper sector-specific knowledge, to their ability to generate outsized returns. There is a real need to bring new, innovative specialist fund managers into the asset management industry. 

“However, investors are acutely aware of risk factors of allocating to specialist managers. Whether that be from ESG and regulatory compliance to the threat of consolidation in the asset management sector. At the same time there is an acknowledgement of the lack of specialist investment management businesses in a market that has become increasingly saturated by larger players. 

“Our findings highlight how the multi-affiliate model can provide institutional investors with the confidence to allocate to specialist investment management businesses, whilst offering them a range of potential managers to allocate to. At Fidante, we are offering our specialist investment managers institutional backing and a realm of services such as distribution and operational support, via our multi-affiliate, minority-stake structure. This enables our affiliate specialist managers with the autonomy to invest and deliver for clients."

To view the report, click here. 

-ENDS-

 

ABOUT THE SURVEY
In March 2024, Montfort Communications and FocalData, on behalf of Fidante, a global investment management business, surveyed 229 institutional investors based in the UK, Sweden, Italy, Norway, the Netherlands, Denmark, and Belgium. The Survey sought to understand their perceptions towards specialist investment managers, and the primary factors they consider when choosing whether to allocate to a specialist manager, or to a larger multi-asset investment manager. The survey report can be viewed here. 

ABOUT FIDANTE
Fidante provides investors with best-in-class investment managers, establishing itself as one of Australia’s largest active investors. Through partnerships with leading investment teams, Fidante offers compelling strategies across equities, fixed income, and alternative assets.

Globally, Fidante manages approximately US$62.0bn (A$90.9bn)* and is part of Challenger Limited Group, an ASX-listed investment management firm. As of June 2024, Fidante Europe has partnerships with eight affiliates, including Ardea Investment Management, Challenger Investment Management, PATRIZIA, Proterra Asia, Elanor, Resonance Asset Management, Ox Capital Management, and Alphinity Investment Management.

For more information, visit https://fidante.com/eu/about-fidante.

MEDIA CONTACTS
MONTFORT COMMUNICATIONS
Jack Roddan: +44 (0) 7825 670695
Charlie Barnes: +44 (0) 7471 475485 
Fidante@montfort.london