The continued demand for after-tax returns and reporting presents a business opportunity for custodians, according to chief executive of QSuper, Rosemary Vilgan, who has just implemented QIC’s Omega investment technology.
Omega, which manages aspects such as capital flows and the levels of diversification, acts as a sophisticated wrap around the investment philosophy and practice of separating alpha and beta, and flows through to the custodian. “This is the start of the future of investing – funds have to be able to move money and risk efficiently, without worrying whether the custodian can handle it,” Vilgan said. With cooperation from custodian National Custodian Services, QIC and QSuper have developed the Omega investment technology, which most closely resembles the corporate treasury in an investment bank, and includes MER, risk management and capital management tools. Vilgan says the biggest bill a super fund pays is its tax bill, and yet most cost management is focused on investment management and administration costs. To help funds in tax management is a business opportunity for custodians, she said.
The $34 billion Brighter Super is set to shift around $10 billion of assets from passive to active management. Chief investment officer Mark Rider says the move is possible because of scale created by mergers, and the fund will be looking to its newly appointed active managers to generate performance through the cycle by taking idiosyncratic risks.
Darcy SongJanuary 21, 2025
