Investment solutions Get future-ready

Global Head of investment solutions Mick Dempsey outlines how Mercer can add value to clients.

Q. Mercer is known as a trusted advisor – what are investment solutions?

For 81 years, Mercer has been making a difference in people’s lives by understanding challenges and developing solutions for a wide range of clients.

We are, above all, a people business and in the latest period of economic uncertainty, we have been keeping in regular contact with our clients to ensure they have the help they need to manage any disruption and changes within their own organisations.

With investment solutions, we take the next step on this trusted advisor journey and by leveraging our scale, skills and expertise, we have created a complete governance framework.

We know that across our wide range of clients, protecting capital is key and over the last few turbulent months, we have seen this framework deliver value that reassures them just as much as the results they achieved in buoyant markets.

Our heritage in investment consulting has given us a deep knowledge of how to both shield investor portfolios and nimbly seek opportunities in a wide range of market conditions. Thanks to our large, global manager research capability, we can access a full spectrum of highly rated mangers¹ – including alternatives and illiquid specialists – to implement them.

Investors who entrust the day-to-day supervision and adjustment of their portfolios to Mercer know their portfolios are being managed by experts who understand why markets are moving and will make every effort to either protect or benefit portfolios from future market moves.

Q. How do investment solutions add value to clients?

Our investment solutions platform is a framework through which our full range of institutional clients can invest with confidence. It helps them navigate uncertainty, capture opportunities in all market conditions and rest assured their portfolio is in expert hands.

But this is not a one-size-fits all solution. From partnering with us through a complete governance package to just selecting certain elements, our clients use only what they need from the investment solutions platform to keep their objectives in focus.

We work with our clients to set these specific objectives, allowing them to delegate as much of the design and implementation of their investments to us as they feel comfortable. Some clients want help on strategy design, others need asset allocation and manager selection support. We also have clients who just leverage our operational capability and due diligence platform to implement their own investment decisions. 

Clients who want a higher level of investment support task us with dynamically managing their portfolios, meaning we can automatically adjust – always within their own tolerances – when we see opportunities or threats arising. Clients can be as “hands on” monitoring their portfolio as they like, while we also produce regular, standardised reports to keep them up to date.

By allowing our clients to select just the elements of investment solutions that they need, they have the confidence of being supported by Mercer, while staying in full control.

Q. How does Mercer support investment solutions operationally?

To support investment solutions, we have built an operational platform that streamlines processes and harnesses the power of Mercer’s considerable intellectual capital and research.

Hundreds of people and thousands of systems, tools and applications are constantly working to help keep clients on track to meet their own target objectives, no matter what happens in global markets.

For clients who delegate portfolio management to us, our investment strategists and asset allocation experts identify where they can add crucial value, drawing on our vast research capability to select who we believe to be the best manager to do it.

The trading operations embedded in our platform gives us the nimbleness to make a decision and execute it, seeking to ensure our clients’ portfolios are well-positioned to face future risks and to seize opportunities. However, we do not directly buy and sell assets and securities – we know that is not our core strength.

Additionally, instead of contracting with a range of managers individually, we aim to cut negotiation time, legal and transaction costs by clients signing one agreement with us. This means implementing an investment strategy through our platform typically takes around 24 hours and gets assets working quickly.

Through our platform, we closely monitor every client portfolio – from changes in funding level and shifts in asset allocation to currency and interest rate hedging – keeping in mind their specific regulatory requirements and investment philosophies.

We aim to give our clients confidence that their portfolio is in expert hands.

Q. Why are investment solutions from Mercer different to other investment providers?

Over the past 15 years, using this process and our world-class investment research team, we have built the largest investment solutions business by assets in the world, managing more than $305bn for more than 1,200 clients². In 2019 and 2020, an independent survey³ confirmed that among our peers, we managed the most client assets.

But while we are the largest, it is not all about size – it’s about what we do with it, too.

At Mercer we work with a wide spectrum of clients – pension funds, insurers, endowments and foundations, wealth managers – and understand how varied their needs can be. We see the nuances within each sector and the discrete issues each of our clients face now and may confront in the future.

We partner with each client to create a specific framework, taking into account their long-term goals and shorter-term pressures. We know things can change quickly, so have drawn on our experience to build a framework that can flex over time.

Our platform also benefits from the vast investment strategy and manager research capability Mercer has amassed through advising investors for more than 70 years. By tapping into this huge knowledge bank, our Investment Solutions clients can harness the power of Mercer’s intellectual capital.

This significant heritage and authority in investment also permits us to press on fees from managers and other service providers.

Q. In a few words…

To sum up, our business is not based on selling products – instead we establish long-term relationships through which we can help meet our clients’ needs, keep them in control and keep their investments on track.

It is often in the most difficult situations that we see the value of close partnerships and the importance of strengthening them for the years ahead.

¹ Highly rated by Mercer’s in-house global strategic research team.

² Source: Mercer, 31 December 2019.

³ As defined in the “Chief Investment Officer” magazine’s 2019 Outsourced CIO  Buyer’s Guide Survey, worldwide discretionary assets under management as of December 31, 2019 as reported by each firm to ai-CIO (http://www.ai-cio.com/2019-Outsourced-Chief-Investment-Officer-Survey/).  AUM data as of 31 December 2019.

IMPORTANT INFORMATION

The investment solutions described on this site may be delivered by different Mercer entities, depending on where you are based.  Not all services described may be available in your jurisdiction.  Please contact your Mercer representative to see what services are available to you.

Investment management and advisory services for U.S. clients are provided by Mercer Investments LLC (Mercer Investments). Mercer Investments LLC is registered to do business as “Mercer Investment Advisers LLC” in the following states: Arizona, California, Florida, Illinois, Kentucky, New Jersey, North Carolina, Oklahoma, Pennsylvania, Texas, and West Virginia; as “Mercer Investments LLC (Delaware)” in Georgia; as “Mercer Investments LLC of Delaware” in Louisiana; and “Mercer Investments LLC, a limited liability company of Delaware” in Oregon.  Mercer Investments is a federally registered investment adviser under the Investment Advisers Act of 1940, as amended. Registration as an investment adviser does not imply a certain level of skill or training. The oral and written communications of an adviser provide you with information about which you determine to hire or retain an adviser. Mercer Investments’ Form ADV Part 2A & 2B can be obtained by written request directed to:  Compliance Department, Mercer Investments, 99 High Street, Boston, MA 02110.

Certain regulated services in Europe are provided by Mercer Global Investments Europe Limited, Mercer (Ireland) Limited and Mercer Limited. Mercer Global Investments Europe Limited and Mercer (Ireland) Limited are regulated by the Central Bank of Ireland. Mercer Limited is authorized and regulated by the Financial Conduct Authority. Registered in England and Wales No. 984275. Registered Office: 1 Tower Place West, Tower Place, London EC3R 5BU.

References to Mercer shall be construed to include Mercer LLC and/or its associated companies. 

Nothing in these documents should be viewed as the provision of investment advice.  Information provided is for information purposes only to assist clients to evaluate investment solutions options that may be suitable for their needs. Any decision on what investment strategy to follow is the clients’ decision.  Nothing in this document constitutes advice, an offer or a solicitation of an offer to buy or sell securities, commodities and/or any other financial instruments or products or constitute a solicitation on behalf of any of the investment managers, their affiliates, products or strategies that Mercer may evaluate or recommend.

Past performance does not guarantee future results. Mercer’s ratings do not constitute individualized investment advice. The value of your investments can go down as well as up, and you may not get back the amount you have invested.  Investments denominated in a foreign currency will fluctuate with the value of the currency.  Certain investments carry additional risks that should be considered before choosing an investment manager or making an investment decision.

Mercer does not provide tax or legal advice. You should contact your tax advisor, accountant and/or attorney before making any decisions with tax or legal implications.

Information contained herein may contain information from third party sources. While the information is believed to be reliable, Mercer has not sought to verify it independently. As such, Mercer makes no representations or warranties as to the accuracy of the information presented and takes no responsibility or liability (including for indirect, consequential or incidental damages), for any error, omission or inaccuracy in the data supplied by any third party.

For the most recent approved ratings of an investment strategy, and a fuller explanation of their meanings, contact your Mercer representative.

When receiving investment advice from Mercer, the advice provided can relate to solutions from both third parties and Mercer group entities. As a result, Mercer does not promote, nor should you consider, the advice provided as being independent. This conflict is addressed in more detail in our Conflicts of Interest Statement. For Mercer’s conflict of interest disclosures, contact your Mercer representative or see www.mercer.com/conflictsofinterest. 

Mercer universes: Mercer’s universes are intended to provide collective samples of strategies that best allow for robust peer group comparisons over a chosen timeframe. Mercer does not assert that the peer groups are wholly representative of and applicable to all strategies available to investors.

When Mercer provides its views on asset allocation strategies that it believes may be appropriate to meet a clients needs, Mercer is not recommending that a client should invest or divest from any specific financial instrument or fund.  Any decision to buy or sell a specific instrument or fund based on information provided by Mercer is the clients decision and should not be viewed as a recommendation by Mercer to buy or sell any financial instrument or fund.

This material may contain confidential and proprietary information of Mercer and is intended for the exclusive use of the parties to whom it was provided by Mercer. Its content may not be modified, sold or otherwise provided, in whole or in part, to any other person or entity, without Mercer’s prior written permission.  The findings, ratings and/or opinions expressed herein are the intellectual property of Mercer and are subject to change without notice. They are not intended to convey any guarantees as to the future performance of the investment products, asset classes or capital markets discussed. 

When Mercer provides assistance through a manager selection service, it may consider a wider range of potential managers for specific strategies than those available through a Mercer Delegated Solution.  Managers or Funds available on through a Delegated Solution may therefore differ to those recommended through a manager selection exercise.

Delegated Solutions can only be provided through certain Mercer entities.  If you choose to implement all or part of your strategy through such solutions, you will be required to contract separately with the relevant Mercer Delegated Solutions entity.

References to Mercer shall be construed to include Mercer LLC and/or its associated companies.