AustralianSuper is looking to add up to 20 investment staff as it moves to take part of the management of its Australian equity portfolio in-house.

The $43-billion fund’s chief investment officer Mark Delaney says the fund’s 40-member investment team – half of which are in the policy part of the portfolio – will be expanded as part of a push to eventually in-source management across asset classes.

“All asset classes are currently external, but we are looking to bring part of Aussie equities internal and we will look to diversify that over the next three to four years,” Delaney says.

Small-cap Australian equities will continue to be externally managed, but the team will focus on the broader market.

Currently, half of its Australian equities are passively managed.

Delaney says that the fund will look to add between 10 and 20 staff members to manage part of its allocation to Australian equities, with the team competing for capital with other managers and strategies.

“We will start carefully and if [internal management] proves to be successful, it will attract more capital, like any other manager works,” he says.

Delaney says that the decision to move to internal management is driven by its capacity to access a better portfolio of assets, whether it can be done cheaper and whether the strategy can be effectively executed.

The investment team currently operates an internally designed risk-management system that looks at risk across the portfolio.

In addition, the team also handles asset allocation and sector tilts.

Investment staff set broad sector strategies, while specific stock selection is left to external managers, Delaney says.

Leave a comment