Investment Performance Challenges

Gauging exchange-traded fund managed portfolios

Morningstar’s EFT Investment conference saw an interesting panel discussion on the difficulties of gauging the performance of exchange-traded fund managed portfolios. The panel noted investor concerns with regard to these investments which were driven by two prime considerations; the lack of transparency in viewing results and an uncertainty over the most appropriate benchmark.  Agreeing that a comparison against traditional benchmarks such as the S&P 500 was not appropriate, the panel suggested that perhaps a comparison against multi-asset ETF products would prove more appropriate.

Pooled Fund charges

Meanwhile a report by consultancy Cerulli Associates has raised concerns about the calculation of pooled fund charges.  The report entitled “European Institutional Investor: Challenges, Conflicts and Opportunities 2013” suggests that as entities such as insurers and pension funds increase demand for itemised accounting, Asset Managers will increasingly be forced into adopting alternate reporting practices in respect of charges.  Speaking at the launch of the report its author, David Walker, said “The pooled fund model that many asset managers grew up on is not dead in Europe’s institutional marketplace, but it is struggling to justify its role for the largest of allocators, who overwhelmingly demand separate accounts”

Investment Performance Measurement Training

If you want to learn more about measuring investment performance the next Eureka Financial course on “Investment Performance Measurement explores all aspects of performance measurement including the calculation of returns, impact of different benchmarks and adjusting performance for risk taken.


Eureka Financial offers over 100 public and in-house training courses in banking and finance, corporate finance and M&A, risk management, operations, investments, wealth management, soft skills and management. For more details visit:

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