Fund managers are often under intense pressures to attract and retain customers

  Because they represent pools of retirement savings, mutual and pension funds are supposed to have long-term investment horizons. As Thomas A. Hockin, President and CEO of the Investment Funds Institute of Canada argues, mutual funds and pension funds "are based on long-term commitments...It is not 'hot money', volatile and fickle". However, for a whole host of reasons to do with the competitive nature of the money management industry, fund managers are often under intense pressures to attract and retain customers by ensuring that their funds perform strongly in the very short-term. The performance of fund managers is often evaluated quarterly and many of them are employed under renewable contracts that are numbered in months rather than years. Therefore, while mutual and pension fund money may be based on a long-term horizon, the men and women who manage these funds can suffer a certain myopia, given the competitive nature of their industry and the way that their pay and bonuses are skewed towards a short-term outlook.