Catholic Superannuation and Retirement Fund has replaced Macquarie Funds Management as the currency overlay manager on its international equities portfolio, and is bidding to increase its existing investment in an energy infrastructure trust.

The $3.4 billion super fund replaced Macquarie Funds Management with BNY Mellon-owned Pareto Investment Management to run a dynamic currency hedge (DCH) on its $800 million international equities portfolio. Pareto has had quite a flexible mandate to run the DCH since it started on July 1, according to CSRF chief executive Greg Cantor. The super fund has a “static hedge” of 40 per cent on its international equities, meaning just under half of the asset class is hedged on a daily basis. However, the London-headquartered Pareto can take the static hedge down to zero or increase it to 100 per cent depending on its market judgement. “It helps us get a bit more alpha,” Cantor said. Meanwhile, the CSRF board decided last week to bid for the right to make another $20 million commitment to the ANZ Energy Infrastructure Trust. The $750 million Trust recently issued its first capital raising for 2008 – its fourth capital raising since inception in 2005. ANZ Infrastructure Services managing director, John Clarke, said the fund hoped to raise $300 million of equity “as we have a strong list of investments that we expect will deliver strong investment returns”. “The current market has seen asset prices fall to a level not seen in a number of years and we believe this represents a fertile market environment for further investment. We’ve been critical of high asset pricing over the last two to three years and it is good to see this finally reverse,” he said. CSRF already has $25 million invested in the ANZ trust, a result of a $20 million investment in 2006, according to Cantor. Existing investors are given the first chance to bid for units in the trust, Cantor said.

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