Deals & People March 9, 2011

Russell Appoints Head of DC Business

Russell Investments hired Richard Davies as managing director, defined contribution (DC).
Reported by

Davies will be responsible for the leadership, strategic direction and growth of Russell’s DC business. He will begin on June 1 in New York, and will report to Greg Gilbert, CEO, Americas Institutional.  

Davies joins Russell from AllianceBernstein, where he has spent 15 years in a number of leadership positions. Most recently, Davies was senior managing director, defined contribution and sub-advisory relationships.   

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Davies also serves on the executive committee and chairs the investment policy committee for the Defined Contribution Institutional Investment Association and is a member of the Employee Benefit Research Institute (EBRI) board of trustees.
The Markets March 9, 2011

Managed Account Industry to Shift from SMAs to UMAs

Managed accounts software provider Peridrome found an expected increase in the adoption of models-based distribution and newer products in a recent survey.
Reported by

More than 120 investment managers, sponsors and outsourcers responded to the 2011 Managed Accounts Executive Outlook, and said that the shift away from separately managed accounts (SMAs) will present challenges to SMA managers, but will provide a windfall of opportunity for outsourcers, emerging sponsors and Turnkey Asset Management Programs (TAMPs) that successfully navigate the new business landscape.     

The company said traditional SMAs will continue to play a significant role in the managed solutions industry.  While sponsors do not expect to increase their traditional SMA assets, only 27% expect their use of these products to decline.     

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Increased traction of Unified Managed Account (UMA) programs may be driven by large sponsors expanding platforms by adding managers new to managed accounts. Investment managers (IMs) with established SMA products are less likely to see UMA as a growth opportunity than smaller IMs who now can expand into UMA through model delivery without the operational barriers associated with traditional SMA.   

According to Peridrome, respondents continue to cite servicing client requests as the least scalable aspect of their operations.  Technology will continue to play a vital role as assets shift from traditional SMAs toward models delivery, UMAs and innovative investment vehicles.  Existing workflow technologies may not provide enough of an advantage to change this perception.

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