Dozens of asset managers and consulting firms are courting institutional investors with solutions-based approaches, yet relatively few are successfully achieving meaningful recognition for their liability-driven investing (LDI) or outsourced chief investment officer (OCIO) capabilities. In fact, one-third (34%) of institutional investors are unable to name an LDI provider they would consider, and 59% cannot name an OCIO provider. These and other findings are included in the annual US Institutional Investor Brandscape®, a Cogent Reports™ study by Market Strategies International.
¡°Liability-driven investing, or LDI, is a clear favorite among corporate pensions managing to a very specific and defined liability stream, and many in the industry are forecasting continued interest in OCIO or fiduciary management services,¡± explains Linda York, senior vice president, Market Strategies, and author of the report. ¡°That said, when we prompted institutional investors with a list of 30 LDI providers, 21% of respondents who said they were interested in or currently employing LDI did not recognize any of the firms as offering LDI services. Moreover, when prompted with a list of 39 OCIO providers, 11% of those interested in or currently employing OCIO services did not recognize any of the firms as providers of OCIO services.¡±
¡°These findings suggest that while many firms are adding to staff and building expertise in these solutions-focused areas, few firms have yet to establish themselves as serious contenders for these services,¡± continues York. ¡°The next step for these firms needs to be a concerted marketing and communication effort to boost awareness and attract new business.¡±
The study identifies the firms that achieve the strongest recognition for their LDI and OCIO services, many of which are already atop the leaderboard for their asset management capabilities and are leveraging these solutions-based offerings to deepen their reach with existing clients beyond the fulfillment of a particular investment mandate. Providers seeking to break in to this lucrative yet increasingly competitive market face an uphill battle but have the opportunity to differentiate themselves by touting their unique approaches to investment outsourcing and the associated benefits that clients can expect to reap.
Top 10 Firms Recognized as LDI Providers |
Top 10 Firms Recognized as OCIO Providers |
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1. BlackRock
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1. J.P. Morgan Asset Management
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2. J.P. Morgan Asset Management
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2. Wells Fargo |
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3. Vanguard
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3. Goldman Sachs Asset Management
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4. T. Rowe Price
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4. Vanguard |
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5. PIMCO
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5. Northern Trust Asset Management
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6. BNY Mellon Investment Management
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6. BlackRock |
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7. Goldman Sachs Asset Management
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7. Russell Investments
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8. Wells Fargo
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8. State Street Global Advisors |
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9. State Street Global Advisors
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9. Commonfund
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10. Northern Trust Asset Management
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10. SEI Investments |
