The implemented equities team of Queensland Investment Corporation (QIC) has drawn on only six underlying managers to build its own hedge fund-of-funds.
By using a small number of managers, four of which have already been implemented in other QIC products, the Absolute Return Fund differs from the more common compositions of hedge FoFs, which often assemble 20 or more managers. Greg Clarke, senior portfolio manager in the implemented equities team at the $80 billion manager, said it was not always necessary for hedge fund investors to allocate to a broad number of managers. “We’re not looking for 60 hedge funds. We believe that you can over-diversify,” Clarke said. Greg Liddell, head of the implemented equities division, said that from this perspective the product could be viewed as an alternative to a typical hedge FoF. The strategies run by the six underlying managers are equity long/short, quantitative market neutral, event-driven and relative value, risk and volatility arbitrage. While QIC holds a segregated mandate with one of the managers, it has, in aggregate, visibility across 75 per cent of the portfolios of all managers, according to Fiona Mann, product specialist with the implemented equites division. The fund, which goes live on October 1, will be seeded internally.
Decarbonisation of fixed income portfolios is a complicated conversation for asset owners, and even more so for Australian super funds which cannot afford too much tracking error, thanks to the stringent guidelines of Your Future Your Super. However, Robeco head of fixed income, Erik van Leeuwen, argued that it is quite feasible to design government and corporate bond portfolios that target a material carbon reduction without excessive impact on risk and return, if investors are smart with their approach.
Darcy SongNovember 1, 2024