HSBC Actuaries and Consultants has launched a statistical analysis service to help schemes determine whether fund managers are delivering on their promises.
HSBC’s Risk and Reward Analysis Service analyses the returns of 33 active UK equity managers monthly and examines fund managers’ portfolios down to the individual stock level to determine the sources of risk and the results.
The consultant believes that this quantitative data – combined with qualitative input from its fund manager research team – can help schemes determine how active their fund managers really are and whether they are paying active management fees for what is essentially closet indexing.
It also allows schemes to make detailed comparisons with a universe of managers with similar performance briefs.
Baillie Gifford director of marketing, institutional clients, Colin Neilson said: “The RRAS analysis provides far more focused research which allows HSBC to ask the right questions of the fund manager. Trustees will also find the output – and the HSBC interpretation – very useful in their selection, monitoring and evaluation of investment managers.”
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