Most P&I Online readers would agree that lower fees are the most important reason to insource more assets, according to a P&I Online poll last week.
While lower fees was only the second most popular answer, the most popular answer, all of the above, includes lower fees. Therefore, fees are the biggest concern when considering insourcing.
See the results below:
- All of the above: 50.8%
- Lower fees: 31.6%
- None of the above: 8.6%
- Improved governance: 5.3%
- Better returns: 3.7%
Insourcing is a growing trend among large institutional investors. Twenty-six percent of the 200 largest U.S. defined benefit plans reported that staff managed some portion of the fund as of Sept. 30, according to Pensions & Investments' annual survey.
Among the large institutional investors shifting more assets to internal management, known as insourcing, are the $265.5 billion California Public Employees' Retirement System, Sacramento; the $27.3 billion South Carolina Retirement Systems, Columbia; and the $78.1 billion North Carolina Retirement Systems, Raleigh.
For more, see “'Insourcing' trend growing among big institutional investors”