A household name in retail funds management is priming itself to perform to an after-tax benchmark, providing further momentum to the after-tax movement.
A spokesperson for AXA Australia has confirmed the allocation of about 10 per cent of National Mutual Life Association’s Australian equities investments to a strategy that purses tax-effective franked returns managed by Alliance Bernstein.
“We believe that the taxation of investments makes a big difference in outcomes to clients, and that our clients benefit by a focus on after-tax returns,” the AXA Australia spokesperson said.
The move follows the path of Sunsuper, which allocated a $700 million Australian equities mandate to the new FSTE ASFA index which incorporates the impact of capital gains tax upon the performance of the largest 300 listed companies in Australia.
While AXA Australia is intending to subscribe to the FTSE ASFA franking credit index, the spokesperson told I&T News that contracts have yet to be signed.
According to the spokesperson, AXA Australia has no intentions to market the after-tax allocation as a stand-alone fund.
UniSuper is also moving into the after-tax sector, with equity managers set to have their performance calculated on an after-tax basis, with excess return measured against a GBST-calculated S&P/ASX series of after-tax indexes, from July.
Last month, UniSuper announced the collaboration between global technology services provider, GBST, in which the service provider would provide a range of after-tax benchmarking solutions to the fund.