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.
Metrics takes out top award among alternative managers
Metrics Credit Partners, just a sleepy institutional fund manager in the credit space a few years ago, celebrated its dramatic expansion in the retail sector last Thursday night (September 10). Having raised record sums for its LICs, including a raising which started early this year, the manager picked up the Fund Manager of the Year award at the annual Australian Alternative Investment Awards.
Andrew Lockhart, the firm’s managing partner, admitted that this had been a difficult year. “Fortunately, we had strong performance going into March and we are pleased with how we’ve gone,” he said. The manager also had two of its funds as finalists in the ‘best private debt fund’ category. The awards are held in conjunction with the annual Hedge Funds Rock event, which was set up as a fund raiser for charity. The number of charities it helps has expanded and the organisation now also has its own foundation which spreads its money among the others.
They are also assisted by AIMA Australia (the Alternative Investment Management Association) part of a global body, but there is a lot of overlap between the two organisations. For instance, Kim Ivey, who usually MCs the event, was a founder of both organisations. Michael Gallagher, a director and general manager of AIMA is on the judging committee for the awards. Gallagher gave a special thanks to Ivey, who lives in Broome and was unable to travel to Sydney for the main live part of the production. “He must be doing it tough,” Gallagher said. “Thanks for all your work [Kim]. If I could give you an award it would be a knighthood”. Other special award winners were:
. Best Investor Supporting Australian Alternative Managers: Ironbark Asset Management, a distributor and fund of funds operator, and
. Contribution to the Australian Hedge Fund Industry, last year won by Michael Gallagher: Nikki Bentley a well-known lawyer in the industry who works for EY as partner, financial services. Bentley said that since 2002 when she entered the industry, she had helped set up many managers. “Unfortunately, some were cradle to the grave, but many went on to great success including expanding overseas. It’s an industry I really enjoy supporting,” she said.
Of the single-category awards, the one in which Metrics Credit Partners had two of the three finalists, Best Private Debt Fund, was won by the third finalist: Merricks Capital Partners Fund. The Merricks spokesperson said his asset class was a growing space in Australia because the banks were not able to meet all the demands of corporate borrowers. “We’ll end up being more like the US and UK with an important non-bank sector,” he predicted. The other winners were:
- Best Emerging Manager: Revolution Asset Management
- Best Equity Long/Short Manager: Munro Global Growth Fund. Founding partner Nick Griffin said it was a good year for growth managers. He thanked his supporting partners Mainstream, the event’s major sponsor, J.P. Morgan and Morgan Stanley prime broking
- Best Market-Neutral Fund: Karara Market-Neutral Plus Fund
- Best Global Macro Future Fund: Adelaide-based QDRA Dynamic Macro Fund
- Best Multi-Strategy Fund: Janus Henderson Alpha Generator, which has had an annualised return of more than 8 per cent over the past three years. In a quick-fire series of ‘thanks’ investment managers from the UK, France the US and Australia showed the firm’s global capability
- Best Alternative Fixed Income and Credit Fund: PIMCO’s Australian Focus Fund
- Best Offshore Manager Operating in Australia: J.P. Morgan Asset Management. David Hallifax, the firm’s head of Australian funds pointed out the firm was also a finalist in the Best Global Macro Future Fund category. “For me alternatives are about being non-traditional and being innovative,” he said, and
- Best Listed Alternative Investment Product: Monash Absolute Investment Co. Ltd.
It was an ambitious production with many moving parts, including a live main studio and a mix of live crosses and pre-recordings. It even maintained its Rock ‘n Roll roots, with a live performance of two unplugged numbers from singer-songwriter Diesel. The event organiser, as in previous years, was Mayhem Corp. The video and audio production company, also as in previous years, was Stella Video Productions. It must have been their most difficult to date but their client should have been very pleased with the result.
– G.B.
