Over the past decade, Actively Managed Certificates (AMCs) have moved from being a niche structuring solution to an increasingly important investment wrapper. Today, assets invested in AMCs are estimated to be around $1.5 trillion globally, with roughly $1.2 trillion booked across Europe and Asia, making these regions the primary centres of issuance. Against this backdrop, it is not surprising that investors are increasingly turning to AMC structures as a flexible way to access actively managed strategies.
What is Driving AMC Growth
- Speed to market has become increasingly important. AMCs can often be structured and launched much more quickly, allowing managers to bring new strategies to investors in a far more agile manner.
- AMCs provide considerable strategy flexibility. Managers can implement a wide range of investment approaches that might be operationally complex or inefficient within other structures. Securitisation is ultimately the reconstruction of one type of risk into another, and AMCs embrace this concept fully.
- The economics can be attractive for both managers and investors. For emerging or specialised strategies, the cost base of launching certain wrappers can be prohibitive. AMCs can offer a more efficient route to market while still providing institutional investors with access to professionally managed portfolios and institutional-grade operations, systems and processes.
- Another important factor is distribution. Many private banks and wealth platforms have become increasingly comfortable with AMC structures. In some cases, they prefer them because they can be integrated into existing structured product distribution frameworks while still providing exposure to actively managed strategies.
- Finally, the broader investment industry has become more open to alternative product wrappers. Investors today are less focused on the label of the vehicle and more focused on the quality of the strategy, transparency, governance and alignment of interests.
Key Benefits of Actively Managed Certificates
Taken together, these factors explain why AMCs have become an increasingly important tool for managers looking to deliver strategies efficiently and for investors seeking access to differentiated sources of return.
Please get in touch and discuss with us how we can assist you in the issuance of your next AMC.