Main findings
- 128.6 Euro billion of total assets under management monitored at end of March 2014, up from 112.1 Euro billion at end of 2013
- Alternative UCITS inflows in 1Q 2014: +12.3 Euro billion, Single managers; +139.5 Euro million, Fund of funds: Long/short equity and Fixed income strategies are responsible for the growth of the sector: +7.3 Euro billion and +2 Euro billion of inflows in 1Q 2014
- Fixed income (33.9 Euro billion), Long/short equity (28.6 Euro billion) and Equity market neutral (11.7 Euro billion) are the top three strategies by assets managed
- 16 new alternative UCITS funds were launched, 16 were liquidated
Flows into alternative single manager UCITS funds in 1Q 2014
Data in Euro millions. Source: MondoAlternative. Chart 1
The first quarter of 2014 had been very strong in terms of inflows for alternative UCITS funds, signing a record three months growth of 12.3 Euro billion for single manager products. Funds of funds added 139 Euro million. “Numbers are proving that the positive sentiment of investors towards alternative and absolute return strategies, emerging from major industry’s surveys, is real”, Stefano Gaspari, chief executive officer of MondoAlternative says. According to the new MondoAlternative quarterly report, Long/short equity and Equity market neutral strategies, combined, attracted 9 Euro billion in just three months, followed by alternative Fixed income strategies (+2 Euro billion). “It must be observed that, during the first quarter of 2014, hedge fund boutiques (companies managing exclusively hedge fund strategies), managing 18.8% of the assets of alternative UCITS products, were able to gather 4.4 Euro billion, the 36% of the inflows, thanks also to a strong result of a US long/short equity manager”, Gaspari outlines. According to the report, inflows into Long/short equity strategies had been stronger in just three months than during the entire 2013: 4.6 Euro billion went to European focused long/short funds, and 2 Euro billion to US long/short funds (822 Euro million combined to UK, Global, Sectorial and Asia Pacific strategies, see chart 2). Looking at the liquidity of alternative UCITS, daily funds gathered +8.1 Euro billion, weekly funds 3.9 Euro billion and fortnightly funds 175 Euro million.
Flows into Long/short equity UCITS funds, by specialization
Data in Euro millions. Source: MondoAlternative. Chart 2
“Alternative UCITS assets are concentrated in the hands of billion Euro companies, that are growing in number: they are now 31 (considering just the alt. UCITS assets under management) and they manage 98.8 Euro billion, or 76.8% of the total” Gaspari says. Five companies, according to MondoAlternative elaborations, gathered more than 1 Euro billion during the first trhree months of 2014, and they are: Sirios Capital Management, Alken Asset Management, Goldman Sachs Asset Management Intl., Marshall Wace and Ignis Asset Management. “Due to the strong inflows, some funds are being closed to new investors because they reached the capacity. We expect that few more, if money continue to flow in, will shut the doors to new investors, in order to work at best for the existing ones. This is a sign that alternative asset managers truly believe in what they are doing and they are not out there just to pile up money”, Gaspari observes. Adding to that and according to the report, 6.4% of the funds represent 51.7% of the industry assets (see chart 3).
Distribution of Industry Assets by Fund AUM
Source: MondoAlternative. Chart 3
Focus on the Italian market
- At the end of March, of the 474 alternative UCITS funds monitored by MondoAlternative, 325 are authorized for sale in Italy.
- In Italy, 22 Asset management companies manage 35 single manager products and 8 funds of alternative UCITS funds, for a total AUM equal to 5.9 Euro billion, registering a growth of 740 Euro million in 1Q 2014.
- Anima SGR dominates the AUM rankings in Italy: Anima Star High Potential Europe (Long/short equity) is the biggest single manager fund with 771 Euro million, followed by Anima Alto Potenziale Globale (621 Euro million, Long/short equity) and Anima Star Europa Alto Potenziale (600 Euro million, Long/short equity) at the end of March 2014.
- Anima Flex 50 leads the Fund of funds ranking by AUM, with 388 Euro million, followed by Kairos International Sicav Multi Strategy Ucits (254 Euro million) and Tages Capital Sicav Global Alpha Selection (140 Euro million) at the end of March 2014.
Other findings of the report
- +0.59% performance (Equal Weighted Index) in 1Q 2014 for single managers (+0.92% Asset weighted Index), during the quarter 3 months Libor performed +0.06%;
- +0.09% performance (Equal Weighted Index) in 1Q 2014 for funds of funds, +0.39% (Asset weighted Index);
- 64.8% of the single manager funds performed positively over the 1st quarter of 2014.
EXCLUSIVE SURVEY: INVESTOR PROFILE
The Research Department of MondoAlternative, during the month of January, conducted a survey about the clientele of alternative UCITS funds.
Survey sample: 50 asset management companies managing about 43 billion Euros in alternative UCITS funds. They come from eight different countries: United Kingdom (66.2 % of the sample), Switzerland (14.3%), Italy (8.7%), France (4.7%), Germany (3%), Sweden (2.7%), Spain (0.3%), United States (0.1%)
Main findings are:
- Out of every 100 customers worldwide, 91.8% are European investors, followed by North Americans (4.4%), Asian (2.3%) and South American (0.2%), with the remaining areas of the world, especially the Middle East and South Africa, which account for the remaining 1.3%
- Looking at individual European countries, subscribers from the UK (34.7%) stand out, followed by Italians (16.4%), Swiss (13.3%), Germans (10.7%), French (8.5%) and those of the Benelux (6%). Lower numbers then head to the Scandinavian (3.3%) and Spanish (2.8%), while among other customers (4.1%), the most important are those from Ireland and Eastern Europe
- Looking at the customer mix, direct institutional investors drive subscriptions with nearly half of the sample (49.3%), followed by the intermediaries representing a market share of 35.3%, and direct private investors stop at 12.5%. The remaining 2.9% relate to the seed money, i.e. the capital management companies directly invest in the funds of the house
- About intermediaries 48.2% of the flows derives from private customers and the remaining 51.8% from institutional investors: Taking into account this distribution, it can be observed that over two thirds of the assets of the sample are owned by institutional investors (67.6%), while private clients represent 29.5% and seed money the 2.9%
- Regarding the institutional clientele, in the top three positions of the subscribers are positioned banks (21.8%), funds of funds (20.6%) and pension funds (19.5%). Further back instead there are insurance companies (10.4%) , wealth advisors (9.7%), family offices (6.5%), government entities (1.8%), and private companies (1.2%)