Future Fund

Finance minister Katy Gallagher has confirmed that she held informal talks with the sovereign wealth fund’s Board of Guardians amidst speculation its mandate could be changed to align it with the transition to net zero.

Australia’s sovereign wealth fund’s prediction of a tough year for investors didn’t come to pass, but they’re not the only well-resourced manager that missed the mark. For investors, this period is a reminder that investment patterns may exist, but markets certainly aren’t beholden to them.

Donald Trump’s possible return to the White House would undoubtedly set back sustainability efforts, but the bigger problem is that his view of geopolitics is “one that anybody who runs capital wouldn’t want him to have”, according to Anthony Scaramucci.

Strong performance in the Future Fund’s hedge fund portfolio helped with some of the heavy lifting on its return this year, while it continues to eye “higher and more volatile inflation” and the opportunities to generate excess returns in Japan.

Illiquidity isn’t without its tradeoffs in a more volatile investment order, according to Future Fund CIO Ben Samild, and neither is the total portfolio approach that’s made Australia’s sovereign wealth fund so successful in it.

Rising geopolitical tensions mean that diversification’s ‘free lunch’ must come from a new menu if investors want to prosper in a brave new world, the Future Fund says.

Super funds have been heading down the path to massive size for more than two decades. They’ve arrived when the transition to a net-zero economy needs that size the most.

TPA is an “uncommon and demanding” approach to running an investment organisation, according to the Future Fund, but a rewarding one – as long as institutions that take it up know that it’s not a transformation that should be embarked upon lightly.

The return of the Future Fund to active equity management has seen it dip its toes into Japanese equities as decades of low growth and corporate stagnation comes to an end.

A panel of experts has pointed to energy, illiquid assets and retirement income as three areas where super funds need to lift their game, with stakeholders expecting the “huge amount of capital” now in the system to contribute to Australian society.