NN’s research found that institutional investors believe the challenges faced by bond fund managers have increased since before the financial crisis.
Of those questioned 61% said they think asset managers must address changing levels of liquidity better than they did 10 years ago while only 42% said managers have to be able understand and invest in wider geographies better than they did then.
Other findings were that 39% of respondents believe greater attention is needed in investing across wider credit ratings.
Some 57% of respondents said risk control is a key quality in a fixed income strategy followed by controlling duration and matching liabilities at 39%, flexibility to invest in a wide range of investments at 35% and a focus on avoiding defaults got 31%.
“Markets are in a very different place from where they were 10 years ago,” said Sylvain de Ruijter, head of global fixed income at NN Investment Partners. “Changes in global conditions, economic policies and financial markets have forced investors to adapt, and being able to adapt quickly will become an even more important skill.”
“Our research highlights that investors fully appreciate the difficulties in securing returns while managing risk,” Ruijter added. “The new reality is that active management has changed, and investors recognise that they have to be prudent about partnering with the right asset managers.”
