As Access Capital Advisers continues to diversify potential sources of return in its client’s portfolios, the likes of AQR’s Global Enhanced Equity Fund are reaping big benefits.
AQR’s quantitative product, which runs a 2 per cent tracking error against the MSCI World (ex-Australia) with an emphasis on low fees and low tax leakage, has taken in just under US$300 million in the past few weeks with US$200 million more on the way.
Most of that is understood to have come from clients of Access Capital Advisers, with the exception of a roughly $70 million mandate with the multimanager funds of asset consultancy, Ibbotson Associates.
Westscheme has already announced a placement of $170 million to the AQR fund, replacing passive mandates, while another Access client, Prime Super, is understood to have put roughly $70 million towards the same ends.
Under its previous dual portfolio strategy, Access clients invested only a 50 per cent strategic allocation to listed markets, and while active management was sought on marginal sectors like emerging markets, all mainstream equity asset classes were indexed. There were no sovereign bonds at all, with their predictable income instead being sought from the infrastructure component of the unlisted ‘target portfolio’ of alternatives.
The chief executive of Access Capital Advisers, Alexander Austin, said sovereign bonds had now returned to client portfolios to provide “a purely defensive and purely liquid asset” previously lacking. Actively managed mainstream equities were also back, Austin said, as the consultant strove for “more balance in the overall line-up”.
Austin said it was not only quantitative active managers winning mainstream equity mandates with its clients, but fundamental stockpickers too.
Meanwhile the strategic allocation to the ‘target’ portfolio of alternative investments has been lowered from 50 per cent to between 37.5-42.5 per cent, Austin said.