Looking to the future

Thu Oct 1, 2009

How far can managed accounts go?

Over the past decade, there has been an inverse correlation between the strength and stability of markets and the demand for managed accounts. That, says Loren Katzovitz of Guggenheim Advisors, is the main explanation for why investors have been slow to embrace the concept of managed accounts over the past 10 years or so.

"We were convinced that after 9/11 there would be growing demand for managed accounts," he says. "But we were surprised by how strong markets were in 2003, 2004 and 2005, which helped people to get comfortable again with conventional hedge fund investing. It took the events of 2007 and 2008 to encourage people to focus on the fact that you are at risk if you don't know what your managers are doing with your money. I think we'll see more institutions turning to managed accounts because of their fiduciary duties....

ISSN: 2151-1845 / CDC10004H

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