Dutch pensions are showing a preference for concentrated active equity portfolios over traditional funds, according to fiduciary manager TKP Investments.

A number of the firm’s clients have begun moving some allocations away from pure passive into active equities after a major switch following the financial crisis, chief executive Roelie van Wijk told the IPE Conference in Berlin yesterday.

“We saw after the credit crisis that a lot of clients went to passive solutions,” she said. “What we see now is partly a switch back. They have said that if they are in equities they would rather have us take a long-term view, buy 30-40 equities and stick to that for a long period of time.”

However, fellow panellist Stefan Dunatov, CIO at Coal Pension Trustees, argued that combining active and passive approaches could be “inconsistent” if benchmarked in the same way.

“I think you have to go all or nothing,” Dunatov said. “We’re on a path to either 100% active or 100% passive, with nothing in between.”

This path would lead to active management being “squeezed”, he added – particularly in the wake of the UK regulator’s damning verdict on asset management in a market review, published last month.

“The active industry has too much money, there is far too much fat in this industry, it’s really not serving asset owners well, and fees need to come down,” Dunatov said. “We’re going down the route where equities will become much more passive.”

Pascal Blanqué, global head of institutional business at Amundi, agreed that managers were coming under pressure.

He predicted that, “in three years, we will be defining alpha as a return above a smart beta index” rather than a market-cap weighted benchmark, with alpha driven by “talent or information advantage”.

Blanqué added that asset managers needed to establish partnerships with asset owners rather than rely on the sale of “cyclical investments”.

On the subject of partnerships, Andreas Kretschmer – chief executive at Germany’s Ärzteversorgung Westfalen-Lippe – said his fund had been involved in partnerships with banks for 15 years, giving access to debt assets and securing “very long-term cash flows”.

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