Competition tightens among mutual funds

Competition between fund managers to attract resources from investors will become fiercer in 2009, says Razvan Rusu, investment manager at Aviva Investors Romania, last year’s best fund manager. In 2008, for the first time in the industry’s over ten-year history, the best-performing mutual fund was a bond fund, Orizont, managed by Aviva Investors, with an annual yield of almost 14%. Orizont holds net assets worth 6.8 million RON pooled from 370 investors. It is not just equity funds that will suffer as a result of the liquidity crisis but also bond funds which, even though they fetched annual yields of over 9.5% in 2008, will have a hard time persuading clients to invest. “In 2009 it will be very difficult to attract money from the market, because everyone needs it. Competition to attract liquidity will be very tight,” said Rusu. Investors in mutual funds include both retail clients and institutional ones (banks, insurance companies), which control over 60% of the industry’s total net assets worth 970 million RON.