Investment Management Roundup – Week Ending 7.10.15

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Hope you all had a safe and happy 4th of July weekend. Here are some thought-leadership articles we’ve been reading and thinking about!


“The rise of passive investment has made alpha a shyer animal: Do we serve our clients best by simply beating a given benchmark net of fees, asks Allianz’s Elizabeth Corley.”
Elizabeth Corley, Chief Executive | Allianz Global Investors | | 7.5.15

Allianz’ Elizabeth Corley argues that active management and active fees promise more than alpha. Adding value and fulfilling fiduciary duty require being active client service operatives, providing quality advice and making the necessary investment in client-facing professionals and supporting infrastructure. Check out her excellent article at

“The Client-Savvy Colors That Make Presentations More Effective: Seven ways advisors can use color to their advantage in client reporting and marketing material”
Professor Joyce Walsh | Boston University | | 7.7.15

Advisor Perspectives recently published Professor Walsh’s article, which is based on research she’s done in collaboration with Assette. You can read the full article at

Coming soon:

“First Impressions Matter: Optimizing Information Organization and Design for Investment Industry Reports and Presentations.”
Assette | | July 2015

Our final paper in the “First Impression Matter” series will be available at later this month. We’re also co-hosting a companion webinar with PAICR, on Wednesday, July 22 from 2:00 – 3:00 pm EST, when Boston University College of Communication Professor Joyce Walsh will provide guidelines and best practices for organizing the content and design of your client reports and marketing presentations for maximum impact. To register for the webinar please click here.


“Higher Standards on the Horizon for CCOs?”
Joanne A. Skerrett | Sullivan & Worcester LLP | | July 2015

Excellent summary of what the SEC expects of CCOs. Among other things, Skerrett recommends that investment management firms should make thoughtful use of technology to aid in compliance. If you’re not a member of IAA, you can access the article at

“RIA Execs Fined and Censured for Ignoring Compliance Program”
“Firm’s Lax Compliance Structure Results in Dissolution and $5 Million in Disgorgement/Fines”
Todd Cipperman | Cipperman Compliance Services | Our Take Alerts Blog | | 5.20.15 and 7.6.15, respectively

Todd Cipperman’s “Our Take Alerts” blog is an excellent source for up-to-the-minute news on compliance actions against RIAs and investment mangers. In the first post, above, RIA execs were fined and censured even though the there was no finding of harm to the client. In the second, a hedge fund manager had to pay fines and close up shop thanks to actions taken by their CCO, who was also a principal of the firm. You can access the posts at


“Majority of managers not confident in accuracy of their investment performance stats — survey”
Rick Baert | Pensions & Investments | | 6.25.15

Baert reports on recent findings of survey by SimCorp, who tapped 88 money managers with combined assets of $22.5 trillion under management. The article cites that 53% percent of respondents said they were not confident in the accuracy of their investment performance figures, and only 59% said they can “determine trades, prices, foreign-exchange rates and security classifications behind their portfolios’ performance numbers.” You can access the full article at

“Active Share, Deconstructed: Hermes Investment Management has provided more research casting doubt on the importance of active share as a performance measure.”
Nick Reeve | Asset International | | 6.09.15

Active share, a popular metric used to assess how active a manager is versus their benchmark, is under the gun as more consultants and asset owners rely upon it as a predictive performance return tool. Reeve’s article neatly sums up the critics’ case. You can access the full article at If you’re looking for a more rigorous treatment of the subject, we recommend AQR Capital Management’s April 2015 study “Deactivating Active Share.”

Note: Full access to some of the articles above may require subscription.

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