Mercer launches FX cost monitor service

15 March 2012
| By Andrew Tsanadis |
image
image
expand image

Mercer has launched a cost monitoring service for foreign exchange (FX) transactions in response to the lack of transparency and control over FX markets.

The new service is designed to make institutional investors more aware of the costs of FX and reflects the growing interest that investors have been paying to FX execution costs following lawsuits against a number of institutions alleged to have applied uncompetitive foreign exchange rates, Mercer stated.

As part of the service, pension funds and other institutional investors can request a review of all spot and forward FX transactions at multiple trading locations in order for them to determine the competiveness of FX costs.

Mercer Sentinel Asia Pacific director Lounarda David said the cost monitor provides information on the sources of excess costs, recommends ways to address these costs, and advice on how to structure FX arrangements over the long-term.

Institutional investors are more attentive to sources of performance leakage, partly because in recent times funds and managers have been at risk of incurring significant excess FX transaction costs, David said.

"The market is becoming aware that if there is no transparency, the risk of paying too much is high and this can impact fund performance," she said. 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest developments in Super Review! Anytime, Anywhere!

Grant Banner

From my perspective, 40- 50% of people are likely going to be deeply unhappy about how long they actually live. ...

11 months ago
Kevin Gorman

Super director remuneration ...

11 months 1 week ago
Anthony Asher

No doubt true, but most of it is still because over 45’s have been upgrading their houses with 30 year mortgages. Money ...

11 months 1 week ago

Westpac has delayed its rate cut forecast, aligning with its peer NAB’s outlook on the likely trajectory for the Reserve Bank of Australia’s cash rate....

4 hours ago

The government’s adjustment to the Future Fund’s mandate could set a dangerous precedent, warns an economist, raising concerns that it may pave the way for problematic fu...

3 hours ago

The proposed reforms have been described as a key step towards delivering better products and retirement experiences for members, with many noting financial advice remain...

5 hours 49 minutes ago