Analysis

by Greg Bright The cash holdings of big super funds outweigh any projected drawdowns because of the Government’s $20,000 early-release program for disadvantaged members by a big factor, according to figures compiled by Rainmaker Information. In fact, super funds have nearly $400 billion in ‘allocated’ cash and even more in ‘operational’ cash held mainly by…

In 2011, professor John Cochrane of the University of Chicago came up with the term “factor zoo”. A fan of factor investing, he felt, however, it had become “too much of a good thing”. Since about that time, the growth in new factor strategies purporting to deliver excess returns from systematic investing techniques has accelerated….

In times of crisis value managers offer some comfort. They can see the silver lining, the light at the end of the tunnel, which other managers tend not to see. At this time of crisis, value managers, surely, after several years of underperformance, are about to come into their own. In a note to clients…

For a slightly different take on the same theme, GQG Partners, another US-based global manager, says that, to a certain extent, everyone is a value investor. No-one wants to over-pay for stocks, whether they seem ‘cheap’ or ‘glamourous’. Entry price is important across all styles. Rajiv Jain, the GQG founder, chair and CIO, says in…

by David Chaplin* Fixed income managers are latching on to the environmental, social and governance (ESG) trend pioneered among their equity counterparts “with a sense of urgency”, a new Russell Investments paper argues. The study authored by Russell global fixed income investment research director Yoshie Phillips, says over the last couple of years there has…

Australia, for once, is one of the top countries in its budgetary response to the current crisis, at more than 10 per cent of GDP in federal government-promised spending. The Australian States and Territories have added to this amount. It’s probably around 15-16 per cent in total. How do we recover that money when the…

In the current circumstances big funds are likely to have to sell at least some illiquid assets, presenting them with an operational issue. Enter the aptly named Melting Point Solutions, a San Francisco-based global specialist broker, represented in Australia and New Zealand by Allen Partners. Scott Riedel, an Allen Partners partner, says that there are…

A total of about 260 global asset owners, including 30-odd Australian fiduciary investors, completed a survey instituted by research and asset manager allocation firm bfinance late last week on how they are responding to the current COVID-9 crisis. We are more pessimistic than most other big investors. The survey also asked whether they were satisfied with…

Research Affiliates, the company which some folks think invented smart beta, even though they didn’t call it that back then, is expanding in Australasia. But its founder, Rob Arnott, is pre-occupied at the moment. Research Affiliates (RA) spends a lot of time looking at risks. And there’s a big one happening at the moment. Arnott,…

by Greg Bright A move away from the reliance on traditional strategic asset allocation as the overarching strategy for big investors and towards the use of a ‘total portfolio approach’, will deliver an additional return of between 0.5 and 1.0 per cent a year, according to new research. Roger Urwin, Global Head of Investment Content…

On a day of celebration for the late Mavis Robertson’s achievements in the advancement of women in the super industry, along with her many other achievements, today (March 2), Morningstar is publishing a report on the progress of gender diversity in the industry over the past 20 years. In a nutshell: it’s zero progress. The…

A group of three big global managers has linked up to promote the benefits of active management in Australia and New Zealand, ahead of what is generally expected to be a sharemarket correction sometime soon. Active managers have been through a rough time in the past two years. In the inevitable downturn, they should shine…