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EQUITY BOUTIQUE

HOW WE CAN HELP YOU

Mercer’s equity boutique is responsible for research and advice in all aspects of equity investment, including:

• Due diligence on managers and strategies
• Structure of equity allocations
• Research on equity investment trends and opportunities
• Advice on portfolio structuring
• Performance reporting
• Due diligence and assistance with fee and mandate negotiation
• Ongoing monitoring of investment managers and client portfolios, including regular updates on performance

Mercer pursues a two-pronged approach to working with clients in regards to their equity allocation – we use both manager research and investment consulting experience to arrive at optimal solutions for clients.

• 14 average years of financial services industry experience
• Selectively looking to increase the number of researchers
• 336 searches conducted in 2012, placing $26.2 billion globally
• More than 10,500 equity strategies and over 132 equity product categories on Mercer’s Investment Manager Database (Mercer GIMD^TM), including long-short equity
• Cover both traditional core products and more esoteric absolute return mandates in conjunction with the alternatives boutiques

For the more complex and challenging demands, the direct involvement of boutique professionals is possible. To illustrate, recent examples include:

WORKING WITH A LARGE AUSTRALIAN SUPERANNUATION FUND

We worked with the client to identify the best way to access small cap managers globally. We have a relatively narrow opportunity set in global small cap but a broader number of regional small cap managers. The area where we needed to broaden our universe was Asia. The Asian team identified a number of potential candidates and undertook due diligence to identify a small number of managers in which they had high conviction.

A LARGE INSURANCE COMPANY

The insurance company had their own in-house asset managers and they decided to externally benchmark their in-house Japanese capability given some disappointing performance. They asked us to identify a number of Japanese equity managers which we did using Mercer GIMD and then we compared those to their in-house offering. They selected two external managers based on our recommendations.

UK PENSION FUND

We undertook a global equity selection exercise to identify two high-conviction managers to manage large, unconstrained, segregated mandates. This involved working with the client to narrow the initial universe of A-rated managers and offer them the opportunity to interview five managers who had different approaches and who were exploiting different factors in order to generate alpha. Having helped them with the selection interviews, they decided to allocate to three of the five managers, one with smaller allocation, based on their willingness to support a recent recommendation from us of a relatively new strategy. This will involve assistance with mandates and ongoing monitoring for the client.