Asset Managers

The data science revolution is sweeping the investment industry. Some firms are looking to create an in-house solution combining artificial intelligence, machine learning and data science. Picking the right data set, and separating the wheat from the chaff, is critical. 

This Luxembourg edition of IO Talks hears about the latest developments in the realm of legislation around alternative investment solutions, and in particular European Long Term Investment Funds, or ELTIFs, and what they mean for Luxembourg. 

At this week’s Alfi European Asset Management Conference in Luxembourg, Emmanuel Gutton, Alfi’s director of legal and tax, spoke to Investment Officer’s Raymond Frenken for this edition of IO Talks Luxembourg. The topic: European Long Term Investment Funds, a new type of investment fund known as Eltifs that opens the door to private equity and alternatives to a wider group of investors, in particular wealth management clients and the “retail plus” segment. Luxembourg is keen to become a European ánd global hub for these funds.

The 60/40 portfolio has been besieged on all sides since bonds failed to protect against the correction in equities last year. Many see salvation in alternative assets, while others preach flexible allocation. 

The first day of the 2023 ALFI European Asset Management Conference heard from the head of the European Securities and Markets Authority, Verena Ross, and included panels on the impact of blockchain and digital assets, as well as corporate taxation.

The head of the European Securities and Markets Authority, which oversees and coordinates the work of European supervisors in asset management, on Tuesday called on the industry to pay more attention to the management of increasing interest rate risks and to step up its efforts in terms of “prudent management” of the investment funds.

As the European Union considers banning inducements (aka kickbacks) for investment advice as part of its forthcoming retail investment strategy, those who support inducements, like Luxembourg’s ALFI and the worldwide CFA Institute, but also strong critics of inducements, such as the EU’s commissioner for financial services Mairead McGuinness and EU investor and financial service users organisation Better Finance are making their widely divergent views known. 

Little is more volatile than financial markets. One minute equity markets are stumbling over yet another mountain of additional interest rate hikes by central banks, the next we are waiting to see if those same central banks need to act to prevent another banking crisis.

Dutch pension funds, a major category of investors in global markets and clients to many Luxembourg real estate funds, last year suffered losses on their real estate investments after many years of rising values. Their investments in real estate funds, however,  delivered positive numbers.

Luxembourg-domiciled Ucits investment funds for retail investors have become the most widely used funds in the Belgian market, the head of Belgian asset management association Beama said on Wednesday.