(This article was corrected November 17.)
*Australian superannuation and industry funds want to bolster their investments in emerging markets stocks to as much as 40 per cent of their total global equity holdings, says Neuberger Berman LLC.
*The New York-based fund manager says many Australian funds have as much as 30 per cent of their total global stock investments in emerging markets.
“Australian superannuation funds have started to look to increase their exposure, directly or indirectly, to emerging markets,” says Paul O’Halloran, senior vice president at Neuberger Berman Australia Ltd.
“They want to know the sources of return from emerging markets, how the return is driven and how to manage it,” says O’Halloran.
Australian funds are ahead of their U.S. counterparts in their emerging market stock investments, says Conrad Saldanha, who is the portfolio manager of Neuberger Berman’s US$1.5 billion emerging markets fund.
The fund has had an annual gross return over 10 years of 19.3 per cent. The MSCI Emerging Markets Index has gained 16.4 per cent per annum during the same period.
“Emerging markets have higher returns but also higher volatility,” says Saldanha.
*(The article was corrected in the first and second paragraphs to say that Australian funds may want as much as 40 per cent of their total global stock investments to be in emerging markets and that currently emerging markets make up as much as 30 per cent of their total global stock investments are in emerging markets.)