Analysis

Northern Trust has announced a new service to help institutional investors and their managers analyse their portfolios for ESG factors. It’s available through the big custodian’s Investment Risk & Analytical Services (IRAS) group. According to Serge Boccassini, the senior vice president for global product, accounting and analytics, who has been at Northern for more than…

Applying professional after-tax management in the transitioning of portfolios by super funds can save at least 30bps in the portfolio’s change-over costs, according to new research by Parametric, the specialist implementation manager. Transition managers don’t always look closely at after-tax impacts. The research report, ‘The Sting in the Transition Tail’ says that both specialist transition…

The prestigious MIT Sloan School of Management, with the assistance of State Street, has produced a paper which questions long-held assumptions about the true volatility of private equity investments. It is particularly relevant right now when some big investors are under attack from conservative politicians. As reported in last week’s Investor Strategy News, Australian Liberal…

While multi-asset strategies have gained popularity in recent years, mostly due to Schroders’ success in Australia and internationally, they are not all the same. Morningstar has produced a report to help investors choose an appropriate multi-asset manager. The Morningstar report focuses on the recent market volatility, so it may not be a good long-term assessment….

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…