U.K. balanced pooled funds significantly underperformed segregated counterparts during the year ended June 30, according to the Combined Actuarial Performance Services Ltd., Leeds, England.
The median pooled fund return was 9.5% - about 200 basis points below the 11.5% preliminary median return for discretionary segregated portfolios, according to CAPS.
The main differences for the underperformance were poorer U.K. stock selection, an overweighted exposure to Japanese equities and how fees are calculated.
Best performances were turned in by Glasgow Investment Managers, at 19.9%; Bank of Ireland, 14.1%; and Fraser, 13.5%. Of the biggest funds, the top ones were run by Morgan Grenfell, 12.9%; Mercury Asset Management, 11.9%; Schroder Investment Management, 11.6%; and M&G, at 11.5%.
Worst-performing returns from larger pooled funds were recorded by Newton, 6.5%; Martin Currie, 6.7%; and Confederation Life, 8%.
Argentina's stock market should be up 30% over the next 12 months, making the market a buy on a one-year view, a report from Baring Securities said. While earnings per share should grow 4% this year, Barings expects 13% EPS growth in 1996. Moreover, the country's risk premium is nearing pre-Mexico fiasco levels.
Baring's top stock picks on the 12-month view are YPF, Astra, IRSA and Massalin.
Trading volumes for American depository receipts climbed to all-time highs during the first half of 1995, according to Citibank, New York.
While fewer companies in the first half chose to launch ADR programs than in the same period last year, there was a marked increase in new issuance and capital-raising activity during the second quarter. The number of ADR shares traded on U.S. stock exchanges climbed to a record 5.1 billion, representing an increase of more than 40% from the year-earlier period. But the dollar value of was approximately $130 billion, even with 1994's first half.
"Though there were price declines in many ADR issues in the wake of Mexico's crisis, the fact that both trading volumes and net issuance were up clearly shows that the ADR is serving its function by enhancing liquidity for investors and expanding the shareholder base for issuers," said David H. Smith, managing director for Citibank's depository receipts business.
Price declines and slack investor demand, particularly in emerging markets, slowed the pace of capital raising through ADRs during the first half. Most came from Europe. Most of the new issuance - more than two-thirds - took place in the second quarter, accounting for 80% of the amount raised.
For the first time, International Finance Corp. will securitize a pool of loans made to private companies in emerging-market countries for sale to institutional investors.
The IFC filed with the Securities and Exchange Commission to securitize a $400 million pool of loans for sale to U.S. and global investors. The IFC will pool senior loans it made to 73 private companies in Asia and Latin America. CS First Boston is advising the IFC, and will be the lead manager for the offering.
The transaction will increase the IFC's capacity to invest by freeing up capital and enable investors to participate in IFC emerging market debt.
The offering will be in three tranches: Class A, rated Aa2 by Moody's Investors Service, will total $340 million; Class B, rated AA by Duff & Phelps, will total $40 million; and Class C, totaling $20 million, will be purchased and retained by the IFC.
In 1994, the total number of domestic companies listed on major emerging stock markets climbed 15% to more than 17,000; the value of these new listings increased aggregate market value to a record $1.9 trillion - up 21% from a year earlier, according to the International Finance Corp.'s new Emerging Stock Market Factbook 1995.
Although the IFC's global composite index of emerging markets fell 2.2% last year, 19 of the best performing markets in the world were in the emerging category.
Kenya, the world's best performer, soared 179% in U.S. dollar terms, followed by Nigeria's market, up 168.8%, and Egypt's market, which gained 167.2%. The world's worst performers also were emerging markets: Mexico's and Argentina's both fell 41.6%;, while Poland's dropped 42.6% and Turkey's plunged 43.3%.
(However, in 1995 through June 2, Turkey's market - up 33% in dollar terms - is the best performer of the 25 markets in the IFC's Composite index.)
WITHAM, England - Manifest Voting Agency, the U.K.'s first proxy-voting service, has been launched.
Manifest initially will be marketed to British pension funds, custodian banks and trustees. Despite extensive publicity on corporate governance issues, many U.K. funds and managers still do not vote their shares.
Sarah Wilson, a principal, said U.K. money managers are less confrontational than their U.S. counterparts and need a different type of service.
Ms. Wilson and Nigel Weller, who together had founded Javelin Securities Ltd., a soft-dollar broker later acquired by James Capel & Co., have been laying the groundwork for the new firm for more than a year.
The new service hopes to use and distribute the National Association of Pension Fund's proxy-voting research covering the top 300 U.K. companies. An NAPF official said the two parties are in negotiations. Eventually, Manifest officials would like to expand the U.K. list and cover international companies as well.
Ms. Wilson said the service would give U.K. managers a competitive edge, particularly when marketing to U.S. pension funds. They also expect to market overseas as the service develops.
AMERSFOORT, The Netherlands - The Kamerbeek Group, a pension, insurance and property management firm, has acquired a half-interest in Triple-A, an asset consulting firm, said Lou ten Cate, head of the Amsterdam-based consulting, known informally as Triple-A.
Triple-A will provide asset consulting for Kamerbeek clients. The two firms had an informal alliance for two years but now are drawn in closer, explained Maurits Hazejager, managing director of Kamerbeek Pensioen Groep, Amersfoort. In addition, Kamerbeek is affiliated with Actuarial Sciences Associates' Asinta international network.
Robert Brown, formerly director of structured equities at NatWest Investment Management, has joined First Quadrant Ltd., London, as a director. His post was created to handle the growing amount of business managed out of First Quadrant's London office.
Rick Lacaille will take over as head of NatWest's structured equities team.