Analysis

by Greg Bright We all know that index funds and smart-beta funds can, and maybe should, co-exist with active management. What we don’t know, yet, is how and to what extent this should happen. This report is based on the views of two well-respected analysts in the institutional market. APRA, with the rest of the…

by John Peterson In response to the article, “APRA still failing members with passive versus active discussion”, published on January 14, 2018, in Investor Strategy News, APRA took issue with the assertion that it is, “pushing super funds towards lower fee investment options”. As my research is the subject of the article, I am on…

By David Chaplin The year ahead will be tough for fund managers globally a new Deloitte report argues as margin squeeze, ongoing technological disruption, regulatory pressure and a consumer revolt come to a head. According to the Deloitte ‘2018 Investment Management Outlook’, the average funds management business “will likely be less profitable and have roughly…

Cyclically adjusted price/earnings ratios are not a great indicator of short-term equity market performance, but they are a good guide to longer-term behaviour, particularly corrections. And Australia is the most highly correlated of 12 major markets. According to a recent study by Research Affiliates ‘CAPE Fear: Why CAPE Naysayers are Wrong’, many factors have recently been…

The New Zealand ‘expansion capital’ sector has delivered handsomely for the NZ Superannuation Fund (NZS) but no further allocations are on the immediate horizon, according to chief investment officer, Matt Whineray. Whineray said last week that the NZ$37.4 billion (A$35 billion) sovereign wealth fund, which has invested about NZ$450 million in NZ expansion capital –…

Each year, Agecroft Partners – an influential US-based adviser to, and a marketer of, hedge funds – predicts the top hedge fund industry trends stemming from its contact with more than 2,000 institutional investors and hundreds of hedge fund organisations. Here are the fearless predictions for 2018 – the firm’s ninth annual tips for the…

After studying the ramifications of the upcoming MIFID II regulations and having moved through the consequent five stages of grief commonly studied by psychologists Eddie Perkin, the chief equity investment officer at Eaton Vance, says he has reached a new stage: “fascination”. In a research note for clients Perkin says: “I am eager to observe the…

The Australian ETF industry grew by more than $2 billion in November, breaking multiple industry records including: monthly net inflows, industry growth and value traded. There were signs of heightened interest from institutional investors. Total funds under management reached an all-time high of $35.5 billion, representing a growth rate of 6 per cent for the…

Ariel Investments, the Chicago-based global manager, has teamed with its Australian marketing and communications partner, Honner, to make a submission to ASIC’s ‘National Financial Literacy Strategy Consultation’. Mellody Hobson, Ariel’s president, has been campaigning on the subject for years, even developing an Ariel-funded curriculum and sponsored schools in the US. The submission recommends that banks…

A new paper, involving researchers across disciplines and firms, argues the ‘institutional manager mandate’ is due for a redesign to meet the aims of long-term investors. The report recommends a new set of standards among big institutional investors. The ‘Focusing Capital on the Long Term (FCLT) Global’ report released last week says the mandate rewrite…

by Greg Bright Sunsuper may well become Australia’s next bellwether fund, perhaps taking over from Aussie Super. Its latest investment strategy and member options to cope with a “lower-for-longer” environment provide a marker for other funds to consider. Regulatory changes have also contributed to this shift. Sunsuper has closed its international shares option for members…

Global hedge fund assets have soared by more almost a quarter over the last two years to hit US$3.2 trillion, according to research published last week by the ‘über’ financial regulator body. The International Organization of Securities Commissions (IOSCO) biennial hedge fund report says the stellar growth in the sector assets under management – probably driven…