Retirement plans, endowments, foundations and other large investors in North America will turn over $420 billion in assets to new investment advisors, according to the “2010 Consultant Search Forecast” survey of 70 leading investment consulting firms by eVestment Alliance and Casey, Quirk & Associates.
The change will be driven by sponsors looking for strong capabilities in developed and emerging markets stocks, hedge funds, hedge funds-of-funds and inflation-protected strategies.
Last year, consultants placed approximately $378 billion with new investment managers, their primary concerns being international and global equities, domestic stocks and core/core-plus fixed income.
“As many in the institutional investment industry are expressing a sigh of relief after a turbulent 2009, [we are now seeing] the beginning of a post-crisis thaw in strategy-driven search activity,” said eVestment Principal and founder Heath Wilson.
“Another key finding in this year’s consultant survey is the apparent dissatisfaction with incumbent managers, particularly in traditional asset classes,” added Yariv Itah, a partner with Casey Quick. “This will increase pressure on investment management organizations to think strategically about their strengths and weaknesses and to effectively manage their consultant and client relationships.”
Respondents to this year's survey serve plans with more than $7 trillion in assets under management.