When Investment Magazine journalist PHILIPPA YELLAND was instructed to consolidate her four super funds and write a diary of the experience, we were hoping for a tale of straight-through processing and customer satisfaction. We didn’t get one. In fact, she found many similarities between her experiences and those of ‘Josef K.’ in Franz Kafka’s ‘The Trial’, the classic story of a citizen tormented by a remote, inaccessible authority. “SOMEONE must have been telling tales about Josef K, for one morning, without having done anything wrong, he was arrested … There was a knock at the door and a man he had never seen in the apartment came in.” The Trial, Franz Kafka*

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Hedge funds, in aggregate, have generated positive alpha in the past 11 years. This finding, made by Roger Ibbotson, founder of Ibbotson Associates and Professor of Finance at Yale University, proves the strategies can resist powerful market declines but often fall short of providing absolute returns to investors. Investors should learn the ABCs – alphas, betas and costs – of hedge funds. SIMON MUMME reports.

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Liquidity is the paramount risk factor for institutional investors to be cognisant of according to Ben Golub, vice chairman and chief risk officer, BlackRock, who has co-authored a new paper outlining the risks learned from the credit crisis. He spoke to AMANDA WHITE about the suitable internal structure for institutional risk management and the risk challenges at BlackRock.

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Green properties are better financial performers, says Piet Eichholtz, of Maastricht University in the Netherlands, who recently helped build a global environmental real estate index. But most managers are either unaware of this dynamic or prefer to talk about sustainability rather than take action. However, some exceptions – primarily from Australia – provide a “green” benchmark for institutional investors in property. SIMON MUMME reports.

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