Since the emergence of “Modern Portfolio Theory” and the “Capital Asset Pricing Model” in the late 1960s, institutional investors have taken a quantitatively driven approach to portfolio construction, looking to create portfolio diversification and obtain better risk-adjusted returns by balancing their asset-class exposures. This journey has seen several important advancements in thinking about how to optimally achieve desired results.
Funds that want to take the total portfolio approach first need to get the total portfolio view. To do that they not only need data – and lots of it – but a rock-solid understanding of exactly how they’re going to use it.
All Black great joins Centric’s super push
(pictured: Andrew Mehrtens)
Centric Wealth, the financial planning and individually managed account provider, has recruited another rugby international, former All Black Andrew Mehrtens, to market its platform and advisory services to super funds. Mehrtens joins an old rugby foe, Phil Kearns, the Centric CEO and a former Wallaby captain.
Mehrtens, a history major who speaks French and Italian, recently completed a coaching stint in France when approached by Kearns about the Centric role. He is in the process of relocating his family from Christchurch to Sydney.
Centric Wealth has about 34 salaried financial planners, with offices in Sydney, Melbourne, Brisbane, Canberra and Newcastle. It has more than 200 shareholders but the largest is the CHAMP private equity group. Kearns joined the firm at the end of 2011 from fund manager Investec.
The super fund offering includes the proprietorial IMA system, model portfolios and high-end advice.
Super funds are looking to provide their high-balance members with SMSF-like functionality, under the fund’s trusteeship, in order to stem the losses to the SMSF market, which appear to be accelerating. According to Tax Office data, about $16 billion was transferred from both not-for-profit and commercial funds into SMSFs last year.
An issue for super fund trustees, however, is how much rope they allow their members without abdicating their fiduciary responsibilities.
