Scrapping mandates with two large institutional managers, the superannuation and Australian equity multi-manager products run by the $300 million MAP have both allocated $10 million to the boutique Bennelong Funds Management.
MAP terminated mandates with a quantitative 130/30 product from Bank of New York Mellon and a micro cap fund run by BT to make room for the Bennelong Australian Equity Partners fund, which now accounts for 20 per cent of the MAP’s super and multi-manager products.
Ross Endres, chief investment officer at MAP, said Bennelong was chosen for its emphasis on stock-picking.
He said that “valuations, and the way markets have reacted to recent events” had created a good environment for stock-pickers.
“For a multi-manager set-up, what used to work – small caps, growth and a resources bias – probably won’t work going forward. Some set-ups have heaps of managers and end up getting the index,” Endres said.
“There is a need for fewer managers and more stock-pickers rather than styles and size biases.”
Endres joined MAP at the beginning of 2008 – “then the world blew up”.
Since the portfolio was heavily invested in equities and held no unlisted assets, it was severely impacted by the meltdown. Now Endres and portfolio manager Andrew Connors are reviewing all of MAP’s investments, including unlisted assets and alternatives.
“The world blew up last year so there was no point in doing anything.
“Now the whole portfolio is being reviewed – international equities, fixed interest, property, cash.”
In doing so, a concurrent aim would be to reduce the number of managers in its portfolios to cut the risk of overlapping holdings and drive down its manager expense ratio, Endres said.