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Government, not super funds, should be guiding decumulation: Grattan
The inertia that rules the retirement system means bigger ideas are needed if members are going to get the best outcome in retirement. And with millions set to retire in the next few years, time is of the essence.
Capital investment can thrive through ‘reglobalisation’ era, despite integration crisis
Investors should keep a close eye on the new Cold War brewing between China and the US, but its outcome could still support “robust” trade and investment as strategic competition drives capital investment.
Trump bump expectations potentially ‘misplaced’: Yarra
Tweets aren’t policy, but Yarra Capital believes that financial markets are underestimating Trump’s intentions. Expect 2025 to be the year of higher debt, higher inflation and lower growth – not to mention plenty of volatility.
Offshore assets drive need for true diversification: Atlantic House
The flip in the negative correlation between bonds and equities has revealed that the protections investors took for granted were based entirely on assumption. Now they need to diversify their diversification.
How to get a ‘return on time’ in private markets
Private market returns are nothing to sneeze at, but investors need to consider whether their prospective allocation is worth doing the hard work to understand the liquidity and transparency issues that come with it.
Why this family office invests in music and mayhem
Natural catastrophe reinsurance and music royalties have been big winners for PG3, the family office of the founders of Partners Group, which is now bringing its “highly differentiated” uncorrelated strategy to Australian investors.
Super early access for housing would hurt every member’s balance
Opening up early access to super for housing would have a negative effect on the balances of even those members that don’t dig into their savings, with funds forced to adopt more conservative investment strategies and hold more liquid assets.
Why value is better at taking market beat-downs
Value stocks are hit harder in market drawdowns but come out of them faster and harder, according to research from Pzena Investment Management.
Secondaries’ ‘global opportunity’ comes to the land down under
Long the bailiwick of institutional investors, private markets secondaries are now trickling down to the wealth space as the market grows and new vehicles expand access.
Why we should pay less attention to benchmarks, and more to value creation
The benchmarks that are supposed to measure performance and create alignment with end investors are working against asset managers, and the industry must find new ways to demonstrate value before it’s too late, according to MFS.
‘Vehicle preference’ and distribution shifts changing the game for asset managers
Even established asset managers are under threat from the violent shift towards low-cost investment vehicles, while allocator preference for platform businesses means they must also bulk up in the private markets.
Why investors need a new approach to diversification, downside protection
True diversification means owning assets that are truly uncorrelated. But that fact hasn’t stopped big investors from piling into the private markets while pretending that the Fed Put can protect their public portfolios.
AMP continues ‘simplification’ push with super, North restructure
AMP will reduce the headcount across its superannuation and North platform businesses and press ahead with changes to its redundancy policies even as the Finance Sector Union warns that “staff deserve better”.
Ausbil charts a ‘materially different’ investment environment
The environment we’re heading into is one where economies will have more redundancies built into them so they can withstand exogenous geopolitical shocks, according to Ausbil.
Volatility ‘warning shot’ not putting investors off… for now
The sharp fall in markets in August was a sign of things to come, according to Ruffer, but one that investors haven’t heeded, with positioning and sentiment becoming even more extreme.
What’s really behind the ASX’s ‘unbelievable’ small cap anomaly
Australian small cap managers are some of the most successful active managers in the world – and charge like it. But their apparently anomalous outcomes might have a relatively simple explanation, according to Invesco.
Why infrastructure’s best feature is ‘misunderstood’
Everybody knows about infrastructure’s inflation hedging properties, but not everybody understands just how unique that hedge is. Meanwhile, the world is going mad for power, and renewables are set to supply it.
When it comes to valuation, ‘a lot of people don’t know what they’re doing’: Avari
Proper valuations are crucial to the transparency and stability of the private credit market, but the valuations that investors rely on are often just a story – and not the whole story either.
How Victor Smorgon Group opened its doors to outside money
Victor Smorgon Group is one of the rare family offices that manage external funds. Doing that required modifying some of the investment principles that it holds dear.
How Pzena is ‘picking up gems’ from the China wreckage
Valuations are so high in India that people need to have “completely given up hope” before Pzena wades in and makes an investment. It’s shopping in China while it waits.
‘Don’t leave gaps in the defence’ amidst simmering market uncertainty: Panel
There’s no crisis yet, but private wealth CIOs and asset consultants are keeping a close eye on markets after their sudden August selloff. Their advice: stay nimble, stay unconstrained, and look out for “the unbelievable opportunity to invest in a dislocation”.
What private credit needs for the next stage of its boom
While private credit is becoming more and popular, it’s not always becoming more and more transparent. And investors will only feel comfortable – and realise that it’s fairly “vanilla” – when they get a good look under the hood.
Getting the ‘best of both worlds’ in IG credit
A higher for longer interest rate environment and likely default cycle in high yield means investment grade credit is once again in the hot seat.
‘Theatre in flames’, but do geopolitics matter as much as investors think they do?
“Look at a country, a conflict, a region – whatever,” former US general and CIA director David Petraeus said. “And then ask whether it has anything to do with the global economy.”
US tech giants could be a bargain in platform change game: Capital Group
In the AI-fueled rally, some companies will win and others will disappear. But while some parts of the market look hideously expensive, their long-term prospects might justify their valuations.
‘They’re going ballistic’: AMP slashes redundancy benefits across business
AMP has cut redundancy pay maximums and notice periods in a move that has left long-term employees dismayed after they stuck with the company through the royal commission and its aftermath.
Gargantuan funds and the ‘second six’: The state of super and what members think about it
KPMG’s latest Super Insights report shows the future shape that the industry might take, with distinct cohorts of funds now emerging across size and service. But there’s little positive sentiment to be found about funds online.
First Sentier withdrawal just the tip of the iceberg for struggling fundies
First Sentier’s decision to close a number of strategies and pivot towards private markets handily illustrates the pressures facing the Australian funds management scene – and the new period of competition into which it is now entering.
‘No pain, no gain’: Marks on the investing game of chess
Good investing requires real sacrifices, according to Oaktree’s Howard Marks, but you can’t expect to be compensated just for making them.
BlackRock’s Fink looks to Australia’s ‘good model’ for US super system
Super funds are an accumulation wonder of the world, but when it comes to retirement they’re in the same leaky boat as every other defined contribution system. BlackRock wants to bail it out.
The bubble that refuses to burst (for now)
In the first half of 2022 the market fell almost as much as it did when Europe tumbled into World War Two. Then it reversed course – and famed bubble spotter Jeremy Grantham says a new artificial intelligence bubble is the cause.
To find their way through markets, investors need ‘optionality’
For the last decade, equities (repackaged and otherwise) have reigned supreme. But in a market where everything might soon start to break, investors have to be more nimble.
Private debt providers well positioned for ‘mother of all default cycles’: Revolution
Commentators warn that a new default cycle will strip the shine from private debt strategies, but not all managers have been “sitting on their hands”. And the dislocation in commercial real estate is creating new opportunities for savvy managers.
ARK Invest’s Cathie Wood on markets and the ‘wonder’ of innovation
After a punishing innings for her flagship ETF, ARK Invest founder Cathie Wood thinks investors need to stop living in the 70s. This time next year the Fed will be “running in the opposite direction” and deflation will dominate the market.
‘Some poor operators out there’: ASIC urged to scrutinise multi-strategy SMAs
Multi-strategy separately managed accounts (SMAs) are “taking off like you wouldn’t believe”, according to SQM Research CEO Louis Christopher, but the rapid increase in their use could also be creating a regulatory blind spot.
Execs take up to 60 per cent pay cut to join new liquid equities fund manager Blackwattle
Having poached a number of high-profile portfolio managers (often at a discount), and with backing from family offices and high net worth investors, new boutique Blackwattle is trying to correct the “inadequacies” of the Australian funds management industry.
Why the active opportunity set is ‘richer than it has been in years’ (and what to do about it)
Active management might be back in a big way but asset managers need to make sure they’re getting what they pay for: skill, not luck. Figuring out manager style and factor biases is key.
The real value of an outrageous prediction
Pandemics, invasions and the return of inflation. If the last few years have shown investors anything, it’s that outrageous predictions can often be anything but.
Sovereign wealth funds tap external managers for private markets payday
Sovereign wealth funds have hit pause on their internalisation programs as they discover that they aren’t naturals at private markets investing. And inflation and geopolitics are driving allocations to a broad range of alternative assets.
‘I cannot recall a more dangerous period than today’: Markets get a brand new Minsky Moment
As a forty-year long bull run fuelled by cheap money screams to a stop, markets are at an inflection point. This time really could be different.
‘Hold your view lightly’: GQG on Russia, ESG
Everybody wants certainty, but it’s the one thing in short supply in markets today.
Super wars renewed by Morrison ahead of election
Once a stalking horse for a small cabal of noisy backbenchers, “Home First, Super Second” has found its way into the Coalition’s policy arsenal ahead of an unpredictable election.
New research puts paid to SMSF performance debate
There’s always been a fight between different superannuation funds – retail, industry, and SMSF – about who performs best. But determining how performance matches up between them has been difficult. The ATO sources its data on return on assets for SMSFs from tax data, while APRA looks at rate of return based on financial statements. […]
Australian Ethical nabs investment heavyweights
Leading sustainable investment manager Australian Ethical has recruited a number of industry veterans for its investment committee as it enters merger talks with Christian Super. Sean Henaghan, former CIO of AMP’s Multi-Asset Group and current CIO of Aurora Capital, will join Australian Ethical’s investment committee. Also joining are Sandra McCullagh, current non-executive director (NED) of […]
Beware the power of a good story
Everybody loves a good story – investors particularly so. But sometimes a good story can lead to a crowded trade, or one that defies reality. “In finance, behaviour is driven by expectations of future returns, and expectations are often driven by stories, particularly during times of heightened uncertainty,” Charalee Hoelzl, investment manager at Ruffer Investment […]
Why investors should learn to love the bomb
The chances of a nuclear apocalypse are allegedly higher now than during the Cold War – but from a financial perspective, investors should “largely ignore existential risk.” A note from Canada-based BCA Research warns that the world now faces a ten per cent chance of a nuclear war – but that the prospect of nuclear […]
Listed equity opportunities ‘cut in half’ as companies stay private
As the amount of capital available to them soars and equity markets grow more volatile, companies increasingly don’t want to go public – and don’t need to. The number of publicly-listed companies on US exchanges has roughly halved from 8,000 to 4,000 in the last 20 years, according to Liberty Street Advisors. And while part […]
Manager selection key in PE
Returns for the classic 60/40 portfolio are expected to be “uninspiring” for the 2020s, according to Schroders, and investors are rushing towards private markets to recapture some approximation of the returns they’ve enjoyed over the last decade. According to data from Schroders, private equity has on average produced a 2.4 per cent net return above […]
Hedge funds, ‘hybrid alternatives’, in the hot seat
Uncertainty has returned to the market after a bumper 2020, fuelled by persistent inflation and a pandemic that never really went away. But in its latest alternatives outlook, JPMorgan warns that investors “aren’t seeing the forest for the trees.” “Up close, the ‘trees’ in the 2022 outlook are clear,” writes Anton Pil, global head of […]
Douglass sticks to his guns after horror 2021
After a hellish close to 2021 that saw the departure of one of Magellan’s largest institutional clients, the pressure will be on for Hamish Douglass to do what he says he won’t: prioritise the short-term. The closing months of 2021 were likely the harshest of Douglass’ public career. Criticisms of Magellan’s underperformance since the 2020 […]
Don’t take blue chips for granted: Marks
Today’s investors are “riding for a fall,” according to Oaktree Capital founder Howard Marks. Markets could well be in for a repeat of the “Nifty Fifty” large-cap mania of the 1960s. When Howard Marks was just starting his career in finance in 1969, the preceding 20 years had been “a “mostly unchanging backdrop… in front […]
‘It’s never been a better environment to start shorting stocks’
“It’s never been a better environment to start shorting stocks,” says Ray David, portfolio manager for the Schroder Australian Equity Long Short Fund. “The last decade has been about asset prices rising because of falling interest rates. We think that tailwind has now come to an end, particularly as Covid has changed market dynamics and […]
Family offices fret on ‘legacy’ – and confront succession
Australian family offices are becoming more ubiquitous. But stresses are starting to show in their approach to tackling climate change and succession. The rise of the family office in Australia since the turn of the century has been meteoric, driven by an increase in “wealth realisation” events post-GFC and the burgeoning infrastructure for supporting them […]
The great crypto debate
Bitcoin’s volatility means that institutional investors have historically steered well clear. But the times are a-changing, and even skeptics believe the cryptocurrency will have its day. Cryptocurrency is clearly here to stay. While most investors watch its massive price swings with bemused detachment, a few have begun to think seriously about the role they can […]
Ox sees silver lining in emerging markets sell-off
While the worst of the September-October sell-off in emerging markets is probably over, the sector is still in a tailspin. But the best thing about starting low is that can aim high. For many investors, China’s recent regulatory crackdown has been a waking nightmare. Add on the Delta variant, rolling blackouts, and Evergrande, and it’s […]
The rise and fall (and rise and fall) of thematic investing
The 2020s are set to be the years of thematic investing – but so were the early 2000s. And the more things change, the more they stay the same. One of the problems in thematic investing is figuring out what’s a theme and what’s just plain old trendy. But that problem is also a problem […]
‘Unprecedented times’ in annuities rush
“So much of our advice process and even our industry has grown up around the accumulation process in superannuation,” says Angela Murphy, CEO of Challenger Life. “It’s been about saving that money. But there is now a greater focus on what the things are that we need as we try to turn that pot of […]
September curse strikes, correction talk grows
September has historically been a bad month for markets, and it could be about to get worse. But then again, talk is cheap. Everybody in equity markets knows that September is the cruellest month, to switch months on Eliot. Nobody really understands why it happens (theories range from tax-related selling to seasonal behavioural biases) but […]
Valuing the bleeding edge
With all this talk of disruptors, it’s hard to figure out what any of them are actually worth. Less, is the prevailing wisdom. You won’t find many investors in the market today who believe that Tesla has that special something that established auto manufacturers don’t (unless it’s a maverick, spacefaring CEO). The question is, how […]
Why you shouldn’t sweat China (much)
China’s ongoing regulatory crackdown has investors running scared. But China still wants to be a global player – and its most successful companies aren’t going anywhere. China’s recent regulatory efforts have sent a chill down the spine of even the most bullish investors, with questions swirling about where and when the aggressive crackdown – which […]
Mota promises a new, digital-first IOOF
Renato Mota, IOOF CEO, believes that advice is changing – and that IOOF must change with it. Key to that will be bringing digital and “modular” services to the unadvised masses. Fresh off the back of its acquisition of MLC, IOOF now has some 2.2 million clients, 1975 advisers, and a burning question to answer: […]
Perpetual plots world domination
A slew of acquisitions has made homegrown investment manager Perpetual (ASX: PPT) a truly global business. CEO Rob Adams says there’s plenty more to come. A 26 per cent increase in net profit, to $124.1 million, has book-ended what Adams described as a “transformational year,” in which multiple bolt-on acquisitions took Perpetual from a key […]
Pressure on advice industry as funds look to robo advice
Super funds have battled with providing financial advice for decades but have not yet found a solution that can make it affordable and efficient for millions of low-balance members. Digital advice – including ‘robo’ – which, in theory, solves the affordability problem, has also been a decades-long dream for Australian wealth management, a revolution in […]
Pikoulas heads for greener pastures
Pikoulas departs Lipman Burgon as Pengana hires for high conviction. Covid-19 movement restrictions don’t appear to have restricted much job movement this week, with Alex Pikoulas amicably leaving his role as chief investment officer of high-net-worth boutique Lipman Burgon. It’s understood that Pikoulas will be joining Harper Bernays – which bills itself as “One of […]
Douglass confronts new world order
In conversation with Ticky Fullerton, business editor-at-large for “The Australian,” Magellan co-founder Hamish Douglass said that two major factors loom as catalysts for an “investment day of reckoning”: the potential for the emergence of vaccine-resistant Covid strains (a case strengthened by the delta variant, which has sent Douglass himself into lockdown with the rest of […]
Praemium’s new direction
It’s been a slow week for wealth appointments, though one can imagine that Sydney’s lockdown – and the uncertainty around when it will end (this journalist’s prediction: by Christmas) – could have something to do with what is usually a steady stream of announcements drying to a trickle. That’s not to say there’s nothing to […]
Ex-Pengana stars in new global boutique
Jordan Cvetanovski and Steven Glass, former Pengana Capital equities managers, have resurfaced at the helm of their own venture, Pella Funds Management. Cvetanovski and Glass formulated their offering after leaving Pengana in March. They have now recruited two staff and commenced discussions with prospective investors for the new international equities boutique. Cvetanovski will be CIO […]
On the move…
Inside Appointments covers all the key moves this week Crestone nabs big bank defectorsCrestone has appointed six new investment advisers to its Brisbane team in response to increased demand from its growing Queensland client base. Two of the newest additions to the team – John Paul Geribello and Jason Poppi, who came on-board in June […]
Markets grow “irrationally enthusiastic” for ESG
Markets are experiencing a “manic moment” around ESG investments and less exuberance now might not be “a bad thing in the longer run”, according to Fidelity investment director Tom Stevenson. Stevenson likens the obsession with ESG to the popularity of the “Nifty 50” – stocks like Kodak, IBM and Xerox – in the 1970s and […]
Aussie Super prompts more Bragg ire over New Daily
Industry fund-owned ‘The New Daily’ is once again in political hot water after a controversial deal with AustralianSuper to auto-subscribe 800,000 of the fund’s members to the publication. ‘The New Daily’ has become a bee in the bonnet for a number of Liberal backbenchers, most notably NSW Senator Andrew Bragg, who has characterised the publication […]
‘I would never have done it’: Monash ditches LIC
Investment firm Monash has restructured its Absolute Investment Company LIC (which traded under the ASX ticker MA1) with near-unanimous shareholder approval, voicing concerns that the LIC was “besmirching” the house’s reputation as top fundies. Monash Investors will restructure its Absolute Investment Company into an exchange-traded managed fund (ETMF) – the Monash Absolute Active Trust (ASX: […]
Morningstar tips for ‘late recovery’ trades
The recovery from 2020’s “massive period of turbulence” hasn’t lifted all boats, and there are still plenty of bargains to be had, if you know where to look. Gareth James, Morningstar’s Sydney-based equity research strategist, expects Link Administration (ASX: LNK), for instance, to bounce back from “a tough few years” of regulatory changes and the […]
Zenith boss warns on ‘overwhelming’ market consensus
Zenith CEO David Wright has warned that advisers are turning away from alternative assets at a time when they may become more important than ever. Speaking to media on Thursday, Wright voiced concerns that advisers were abandoning alternative assets despite the possibility of “stronger than forecast inflation” and heightened market volatility. “There does appear to […]
Pessimism termites and super-crazies: Grantham warns on “bubbly markets”
Legendary investor Jeremy Grantham says that while markets are in what he’s called “one of the great bubbles of financial history,” there’s “no traditional pin” to pop it. Speaking to Morningstar CEO Kunal Kapoor, Grantham – who famously dodged the Japanese asset price bubble in the 1980s, as well as the Tech Wreck and the […]
AMP slashes jobs to save business
AMP’s wealth management arm will launch a cost-cutting program and make sweeping redundancies across its workforce in a bid to turn the troubled business around. While “Ms Fixit” Alexis George is yet to step into her new role as AMP Limited chief executive after leaving ANZ, AMP Australia – which is responsible for wealth management […]
‘Uneven’ impact of race to net zero opens huge opportunity
The mooted transition to net-zero will have an “uneven impact” across sectors, presenting opportunity and risk in equal measure, according to JP Morgan Asset Management. Companies that can achieve climate-based technology solutions are set to be the “biggest beneficiaries” of any new environmental initiatives, with autos in the hot seat as one of the most […]
‘The market is efficient, but it has no imagination’ – Ausbil
Global small-caps consistently outperform their large-cap brethren – and do it with a better risk-adjusted return – but few investors are paying attention, according to Ausbil portfolio manager Tobias Bucks. “Global small-caps outperform global mid-and large caps. Like all maths, it’s boring but it’s true,”Mr Bucks told the Inside Network’s Equities and Growth Symposium on […]