LOUISVILLE, Ky. Institutional investors greatly increased assets they assigned to global equity and fixed income in 2007, according to a report by Eager, Davis & Holmes LLC.
At least $30.3 billion, or 12.4% of all assets going to managers in 2007 were for global equity and fixed-income mandates combined.
That compares to 0.8% in 2006 and 1.9% over the previous five years, between 2002 and 2006.
Some 43% of all global mandates went to active equity strategies, 8.6% to passive equity and 48.4% to global fixed income. While global mandates were hugely popular among defined benefit plans, and endowments and foundations, only four defined contribution plans picked global strategies last year.
Overall, institutional investors allocated a total of $244 billion last year, according to the Louisville-based money manager consultants Tracker Hiring Analytics 2007 Year End Report: U.S. Institutional Hiring Analysis, which tracks the publicly reported hiring activities of public and corporate retirement plans, foundations and endowments.
The total number of hires for the year was 2,314, up 63.1% from 2006. At least half of the increase can be attributed to a new source of data that wasnt used in 2006, according to the report. Discounting the new data, the number of hires increased by 32%. Because the data is based on publicly available information, the survey is biased heavily in favor of public pension funds.
The survey also found that alternative investments, which include private equity and hedge funds, pulled in more than $78.1 billion in 2007, topping all other categories. Alternatives accounted for 32% of all assets awarded last year, down slightly from 33% in 2006.
The share of new mandates won by U.S. active and passive equity strategies has declined over time. They pulled in $47.3 billion, or 19.4% in 2007, vs. 28.1% for the previous five years. Real estate was $23.4 billion, or 9.6%; international active equity was $15.1 billion or 6.2%, with the remaining assets falling under other.