23 Nov. 2010 | Comments (0)
- Even gains did not alter the institutional landscape: At the end of 2009, pension funds were still the leading category, holding 39.9 percent of total institutional assets. Investment companies had regained the market share that appeared to have been lost to insurance companies in 2008. As a result of the risk tolerance improvements of retail investors, insurance companies and savings institutions—which had slightly expanded at the height of the crisis—retracted to levels registered prior to the crisis.
- Institutions remained committed to their investment policies: Equities remained the investment of choice for state and local pension funds (traditionally long-term investors) and open-end investment companies (traditionally more engaged in equity trading activities), whereas life insurance companies invested as much as 63.4 percent of their assets in securities that guarantee a fixed income.
- New capital injections in alternative instruments: The decline experienced by the hedge fund industry in 2008 continued into the first quarter of 2009, but was then reversed by capital appreciations and a renewed flow of investments into the asset class. Fueled by the liquid nature of hedge funds and the outstanding performances of some alternative investment strategies during the market rally that followed the crisis, year-end assets under management were valued at over $1.6 trillion (a 13.7 percent increase over the 2008 level).