< The 2014 All-Europe Research Team
For a fourth year in a row, Deutsche Bank’s team, co-led by Simon Carter and Pamela Finelli, captures the crown. The seven strategists in London win plaudits from one asset manager for “always being on top of new developments regarding new instruments in the field.” One example: the listing of MSCI Europe Index options on the Eurex Exchange in early 2013. “We’ve seen some very, very sizable trades over the last two to three months of people starting to use these benchmark options,” says Carter. “This is a real evolution in the equity derivatives market.” In the past, money managers wanting to offset MSCI Europe exposure had to use a proxy or alternative, which meant “you’re exposed to your hedge not working because you’re using an option or hedge on something that is different to your benchmark,” he explains. “So you can find that your benchmark falls a lot and your hedge just doesn’t pay off that much.” He predicts that the use of these new derivatives contracts will be a major theme over the next three to five years as investors become “much more willing to look at slightly more nuanced and tailored options for their portfolios.” Carter also observes that the dispersion of performance among indexes, sectors and stocks “really widened up massively” in the second half of 2013, while Europe’s nascent recovery developed. For active managers, “alpha is more available and more stable than it has been, certainly in European markets, for years,” he says. “It’s a much less macro-driven world and is much more about the fundamentals of sectors, stocks and regions,” concludes Carter. See also Simon Carter and Pamela Finelli's profile in the 2013 All-Europe Research Team. |
