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.
Fidante’s Ox Capital the new home for top manager
Joseph Lai, the top-performing Asia equities manager who resigned from Platinum Asset Management on December 29 last year, is set to join Fidante’s new boutique, Ox Capital.
He will reportedly link up with another long-term emerging markets specialist, Doug Huey. The two had worked together at Platinum, where Huey was an investment analyst, prior to his leaving to join PM Capital in 2018.
Lai has kept his own counsel about his intentions since Platinum disclosed on its website just after Christmas that Lai had handed in his notice. This prompted considerable press and industry speculation about his likely career move in January and February, with the most common suggestion being that he would establish his own firm or join another boutique.
After news that Fidante would back the new emerging markets manager was reported in Financial Standard newsletter last week (June 21), sources confirmed that Lai was also headed for the Challenger-backed multi-affiliate offshoot.
Ox Capital plans to launch two funds at first, an emerging markets fund and a ‘dynamic emerging markets fund’, according to the newsletter.
The Platinum Asia ex-Japan fund, run by Lai from 2014 until the end of 2020, is now being co-managed by Andrew Clifford and Cameron Robertson. Clifford, the firm’s co-founder, previously headed up the Asia ex-Japan fund.
The Platinum Asia Fund has about $5.1 billion under management, complemented by two listed entities using the same strategy, an LIC with $495 million and a quoted managed hedge fund with $177 million.
The main Asia ex-Japan fund has returned 14.9 per cent annualised since inception in March 2003, compared with the benchmark MSCI All Countries Asia ex-Japan net index (in $A) return of 10.6 per cent.
While the fund’s one-year performance numbers have remained comfortably above benchmark, as of May 31, returns have slipped in the past six, three and one-month periods.
Lai did not return messages prior to this masthead’s press time.
