AUSCOAL Super, the $4.1 billion industry fund for Australia’s coal community, has just completed a restructure of its $800m fixed interest portfolio.
In a departure from a more traditional indexed-based approach to managing fixed interest, AUSCOAL has appointed five new managers whose style focuses on absolute return.
“The mandates are structured to encourage managers to use their skills to identify value across the full range of sectors within the fixed interest universe. Implicit in the mandates is a disincentive to invest in sectors or securities which they perceive as offering little value,” said an AUSCOAL spokesperson.
The managers chosen for these absolute return mandates are Franklin Templeton, Mondrian, Schroders and Australian-based boutiques Vianova and Kapstream.
Meanwhile, AUSCOAL will attempt to exploit opportunities in the global credit sector through the appointment of AllianceBernstein and Banquo.
The remainder of the portfolio will be invested in Australian and global inflation-linked securities and longer-dated sovereign securities. These mandates will be managed on an enhanced passive basis by Challenger-backed boutique Ardea, as well as PIMCO and Kapstream.
From the original manager line up of AMP Capital Investors, Credit Suisse, PIMCO and BT, only PIMCO retain a mandate.
AUSCOAL’s CEO, Bruce Watson said: “AUSCOAL has carefully chosen eight new fixed interest managers with the skill base to seek and exploit value opportunities within the fixed interest universe. While this represents a departure from more traditional benchmark aware fixed interest investing, it is AUSCOAL’s long held belief and experience that active management adds value for our members.”