Analysis

Casey Quirk has a history of making big bold predictions. The direction of those predictions is invariably correct, but the firm is often ahead of its time. Their latest prediction is about China. All funds managers should take note. Casey Quirk, the specialist asset management consulting firm, predicts that China will become the second-largest asset…

With US interest rates considered likely to resume their upward spiral as soon as next month and with little prospect of relief for investors who rely on an income, the whole world, it seems, is searching for an alternative to bonds in their portfolios. Here’s the case for floating-rate loans. According to John Redding, who…

Research Affiliates, arguably the inventors of ‘smart beta’, have raised the question that even though interest rates may be pushed up soon due to regulatory action, it is possible that bond prices are not in a bubble. Contrary to the consensus, maybe sovereign bonds are at fair value. In a recent paper, Californian-based Research Affiliates,…

The jury is out on whether the passive investment boom distorts market fundamentals, a recent paper by index provider FTSE Russell argues, with further evidence required to settle the case. In its report titled ‘The growth of passive investing: Has there been an impact on the US equity market?’,  FTSE Russell debunks some concerns that…

About one third of the 500 biggest global fund managers cut fees over the 2016 calendar year, according to the latest annual Willis Towers Watson (WTW) funds management industry review. The WTW study found just 7 per cent of the top 500 global asset managers were able to eke out a ‘moderate’ fee increase during 2016…

Mercer will begin reporting from next year on the practical impact of its responsible investment (RI) approach in addition to financial measures. Speaking at the group’s conference in Wellington, New Zealand, last week, Alexis Cheang, the Sydney-based Mercer senior consultant for responsible investments, said the firm had developed a framework for measuring outcomes against sustainability…

NZ Superannuation Fund (NZS) head of investments, Fiona Mckenzie, has resigned to assume a new position as head of direct wealth for stockbroking firm, FNZC. Her resignation coincides with the departure of the big fund’s investment analysis manager, Roland Winn, who plans to return to Australia. An NZS spokesperson said the NZ$36.6 billion (A$33 billion)…

Funds managers have been aware for a long time that size is an issue for outperformance. There are various rules of thumb – such as 3 per cent of the market’s capitalisation – but it really depends on style and processes. In recent years, super funds have become aware as well, for their own assets…

By David Chaplin Investors should lead with the head not the heart when it comes to assessing ‘impact’ assets, a new paper from Russell Investments says. The report, authored by Noah Schiltknecht, says while impact investors may be happy to give up some monetary gain in exchange for the targeted social ‘good’, careful financial analysis…

Although the major index providers have recognised the growing need for information about the carbon exposures of companies represented and despite the increasing popularity of factor indices for smart beta strategies, the carbon footprint of factor indices has tended to be overlooked. Recent work by S&P Dow Jones Indices has ranked the major factors by…

A recent paper by Willis Towers Watson, which looked at all the major options facing big super funds in designing pension-phase strategies for their members, including different tax positions, says retired members should have less in total equities, but 5-10 per cent more in Australian equities than members in the accumulation phase. The paper, ‘Investing…

The NZ industry has flipped its views on responsible investing in record quick-time, according to a just-released survey. In a follow-up to the inaugural 2016 report, the second BNP Paribas Securities Services/Investment News NZ industry survey found almost 70 per cent of respondents would increase their focus on ESG factors this year compared to just…