Asset Management One Co. plans to boost spending on talent over the next three years as rising Japanese interest rates broaden investment choices and push pension funds, university endowments, and individuals to rethink allocation strategies. The Tokyo-based asset manager expects to invest as much as ¥5 billion ($31.6 million) in personnel over the period, a rise of about 30% from the previous three-year period. The funds will target hiring professionals who can advise clients on overall asset allocation and alternative investments, as well as enhancing compensation for portfolio managers.
President Noriyuki Sugihara emphasized that people capable of assessing an entire portfolio and recommending optimal allocation are "extremely important." This push reflects a fundamental change in Japan's investment landscape after decades of ultra-low rates. The benchmark 10-year Japanese government bond briefly climbed above 3.1% in late September, the highest level in roughly three decades, making a wider range of domestic fixed-income products viable. Simultaneously, inflation is pressuring pension funds and university endowments to improve returns. Individual investors now have more options following an expansion of the country's tax-exempt NISA investment accounts and higher yields on government bonds for retail investors.
Asset Management One established a portfolio solutions department last year to provide comprehensive advice to corporate pensions and university endowments across asset classes. The company is also expanding its alternatives business, wholly owning a subsidiary specializing in hedge funds and private equity. Staffing there has increased by 40% over the past four years to 67. Assets in infrastructure-related funds managed in-house have surpassed ¥100 billion.
"For areas where we have a path to winning, we will continue to explore the potential of the in-house business," Sugihara said.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing