There are just a few days to go until our free breakfast seminar, Evidence-Based Investing for Trustees, at the Amba Hotel Charing Cross in London.
If you’re a trustee responsible for investing money, you don’t need us to tell you how important a responsibility you have.
The role of investment consultants
As recent investigations by the Financial Conduct Authority and the Competition & Markets Authority have shown, the investment consultancy sector is not delivering the value for money that pension funds and charitable trusts demand.
Research published in August by by Tim Jenkinson and Howard Jones from the University of Oxford in conjunction with Jose Vicente Martinez of the University of Connecticut, showed that, on average, the products recommended by investment consultants performed no better than other products available to institutional investors.
In fact, once fees were factored in, all of the recommended products combined produced returns 0.30% per year lower than a portfolio of all the products available to plan sponsors that weren’t recommended.
The researchers also found a possible explanation as to why the funds that were recommended underperformed those that weren’t — they were less likely to deviate from the index. Funds that hug the benchmark are less likely to perform disastrously, but are also far less likely to outperform.
Most worryingly of all, when the researchers examined the claims that investment consultants made about their recommendations, they found that they exaggerated their performance by a whopping 2% a year.
So, is there still a place for consultants in the institutional investing space? If so, what sort of help should trustees be looking for?
We’ll be looking at both of these questions, and also asking, what does the academic evidence tell us about the best way for pension funds and charities to invest for the future?
The session will be presented by Robin Powell, our Head of Client Education. Also speaking will be Lars Kroijer, the former hedge fund manager, and David Jones from Dimensional Fund Advisors.
Book your place
If you would like to attend our seminar at the Amba Hotel Charing Cross, it runs from 0830 to 1030 on Wednesday, 17th October 2018. All you need to do is email Sarah Horrocks at firstname.lastname@example.org.