The latest news in investment offerings, financial products and other services relevant to wealth advisors and their clients.

MSCI
MSCI has rolled out indices to track venture-backed companies, another way of measuring performance of unquoted companies – an area of growing investor interest from wealth managers.

The organisation has launched two MSCI All Country Venture-Backed Private Company Indexes.

The performance of private companies is tracked by secondary market transaction data, MSCI said in a statement yesterday. 

MSCI is plugging into a broad trend of more firms staying private rather than listing on the stock market. On the demand side, investors have become more interested in private companies because of their perceived superior yields over a cycle to compensate for less liquidity. Such qualities became more attractive after the 2008 financial crash when interest rates were slashed to almost zero in most countries, blunting the appeal of listed stocks and bonds.

The number of US publicly listed firms in the US fell by almost half between 1996 and 2022, MSCI said, citing data from the World Bank. The number of venture-backed firms worth $1 billion or more has also grown more than tenfold in the past decade (source: CB Insights).

“With growing investor interest in private markets, high-quality data and consistent, independent performance measurement of private companies and funds alike are crucial for the entire investment ecosystem,” Jana Haines, head of index at MSCI, said. 

Expansion of unquoted companies as a share of the total has prompted MSCI to develop the MSCI All Country Venture-Backed Private Company Top 20 Equal Weighted Index and the MSCI All Country Venture-Backed Private Company Top 20 Equal Weighted Vintage Index.

The blending of private and public market investments is part of a “total portfolio approach” that MSCI recently set out in a white paper, Total Portfolio Allocation For Modern Wealth: A holistic public-private asset allocation framework for managing concentration risk and uncertainty in expected returns.

In July last year, MSCI launched MSCI Private Capital Indexes.

Considering how inclusion in an MSCI index, such as the flagship World and Emerging Market indices, can have a material impact on share prices and asset allocations, the move into the private markets area is significant. Just as ESG investing has spawned a raft of new indices, now it’s the turn of private markets. As soon as new indices spring up, they can then be used as building blocks for entities such as exchange-traded funds.

Manulife
Manulife Singapore and Manulife Investments have enhanced Manulife iFUNDS. The entities say it is the first integrated digital wealth platform in Singapore to provide Manulife financial consultants with a consolidated view of their customers’ Unit Trust and Investment-Linked Plan (ILP) holdings.

These changes enable united trust transactions directly within Manulife iFUNDS, streamlining wealth management services and enhancing efficiency, Manulife said in a statement. 

Launched in 2018, Manulife iFUNDS offers digital investment tools and insights. 

The iFUNDS platform removes the need for financial consultants to toggle between multiple platforms, Manulife said. 

"Digital solutions are essential to providing timely investment insights to financial consultants, equipping them to deliver superior customer experiences tailored to client preferences,” Hui-Jian Koh, CEO, Singapore, Manulife Investments, said.