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Gluskin Sheff + Associates has announced the appointment of David Vankka as vice-president, risk management, for the firm.

“We are very excited to welcome David to our growing team,” said Jeremy Freedman, deputy CEO with Gluskin Sheff. “We are committed to providing a platinum level of service to our clients, and David strengthens our ability to do so for our western-based clients.”

Vankka joins Gluskin Sheff from Tristone Capital Inc., where he served as managing director, institutional sales and trading, for the past seven years. Vankka will be based in Calgary, anchoring the firm’s drive to serve clients in western Canada.

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Jantzi Social Index trails slightly

Sustainable investing trailed the overall market in September as the Jantzi Social Index (JSI) offered a return of 4.03% for the month, according to Jantzi-Sustainalytics.

The overall S&P/TSX Composite Index increased by 5.14%, and the S&P/TSX 60 Index gained 4.56%.

Over the longer term, the JSI continues to outperform the overall market, but with an annualized return of 5.52% since the index’s inception on Jan. 1, 2000. Over the same period, the S&P/TSX Composite and the S&P/TSX 60 had annualized returns of 5.34% and 5.43%, respectively.

Returns for the JSI were hampered by the technology sector, which trimmed nearly 59 basis points from its overall return.

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Institutional manager fees still falling

Fee revenues and pre-tax profit margins among American institutional investment managers continue to fall in 2009, much as they have since 2006, according to Callan Investments Institute’s 2009 Investment Management Fee Survey.

The published fees for active management of equity mandates may have risen among large accounts, but passively managed equity mandates have seen fees decline. Actively managed fixed income strategies have also seen fees decline, while fees on passive fixed income strategies have held steady.

So much for the published fees. Actual fees on U.S. large cap equity mandates are between 85% and 90% of the published fees, the report says. U.S small cap equity fees are just 83% of those published, while non-U.S. equity fees are between 70% and 75%.

The study found that performance-based fees are becoming more popular as an alternative to the usual fee schedule. Nearly 60% of pension fund sponsors have opted for performance-based fees for at least one account, and 64% of managers offer them.

With managers struggling to post positive returns over the past year, these performance-based fees have been hard to come by.

Managers have become stingier with discounts, with 31% saying they do not offer cut rates for multi-portfolio clients, up from 21% in the 2006 Callan survey. Meanwhile, more than one-third of managers will offer a “relationship discount” on the sum of all individual fees charged to a single client.

Callan found that the fees paid to managers represent 88% of the plan sponsors’ costs. Half of plan sponsors said the fees they paid were justified, compared with 71% in 2006, while 33% said fees charged industry-wide were justified, compared with 47% in 2006.

Over the coming 18 months, fund sponsors said they plan to add managers to virtually all asset classes within their funds. The exception is the U.S. equity portions of their portfolios, where they expect to consolidate management.

(10/07/09)