Institutional Investors expect more from asset managers and those who are most successful in distribution have adapted to meet these needs. Solving problems, rather than offering products requires a greater level of advice and counseling.
The Bottom Line:
- Investor needs are typically holistic, but the industry has focused on delivering relative performance across a limited set of traditional products
- In recent years, investors have struggled to meet their needs
- Over-reliance upon equity risk premium
- Focused on relative performance
- Low growth/low yield environment
- Over-reliance upon traditional single-strategy building-blocks leading to ineffective diversification
- Investors want superior outcomes
- They want to follow a strategic plan and better align policy to outcomes
- They want to see positive results in continued challenging market conditions
- They want to achieve better diversification across risk exposures
- They are willing to change how and where the invest
- Investors are looking to asset managers for assistance