Super fund investments in private markets have helped members and the Australian economy, but they must keep working to balance their need for diversification and performance with any “heightened risk”, according to a long-awaited ASIC report into the sector.
As the AI boom finds its way out of asset owners’ equity exposures and into their real asset portfolios, they need to keep a close eye on the rate of technological change to make sure they don’t get left behind.
As volatility tests traditional portfolios, asset owners are rediscovering hedge funds despite some roadblocks. But they need to be aware of both what they own and why they own it.
Rather than the typical short, sharp surge in bond prices resulting from recession, this time will be different: a prolonged moderate return bull market against a backdrop of mild growth and slowly decelerating inflation, PGIM’s Robert Tipp told the Fiduciary Investors Symposium.
The $85 billion Mercer Super is looking to grow through acquisitions, and CIO Graeme Miller says the fund has both the “balance sheet and track record” to follow through on that aspiration.
The $400 billion AustralianSuper has been named most transparent super fund in Australia and the fourth in the overall Global Pension Transparency Benchmark ranking, scoring 93 out of 100. But on a five-year basis, Australian Retirement Trust saw the biggest score uplift as its merger prompted the creation of more rigorous public reporting standards.
Robin Khuda, the billionaire founder and CEO of private equity darling AirTrunk, told the Investment Magazine Fiduciary Investors Symposium that the business of data centres is expanding to include activities such as power generation – which makes them even more challenging to categorise as assets. But investors who aren’t siloed in their thinking are most likely to be able to take full advantage of the opportunities presented by a seemingly insatiable appetite for capital.
Requests for state intervention for compensation of Shield and First Guardian victims may seem ridiculous, especially given the wealth and power enjoyed by some of the companies embroiled in the scandal. But Australia’s unique superannuation system is no free market, so the private sector alone should not be expected to find the solutions.
Australia’s super system faces three converging investment challenges: deciding when to go active; navigating the growth of “benchmark-anchored” investing; and managing capacity constraints as assets under management balloon. Geoff Warren, research fellow at The Conexus Institute, unpacked the problems at the Fiduciary Investors Symposium.
The AI evolution has a long way to run, according to Blue Owl’s Alicia Gregory, who told the Investment Magazine Fiduciary Investors Symposium that the US market remains one of the best places to get exposure to it.
UniSuper chief investment officer John Pearce has no problem pulling mandates if a trusted portfolio manager leaves an external manager, arguing that investment edge often rides on top talents. In a wide-ranging chat at the Investment Magazine Fiduciary Investors Symposium, Pearce reflected on more than 16 years leading the fund’s $150 billion portfolio.
Passive equity strategies have grown to dominate the investment landscape, but rising concentration risks, benchmark performance tests, and hidden passive costs are prompting asset owners to consider more nuanced approaches.
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Investment Magazine provides in-depth, monthly analysis of trends and developments for all the businesses in which superannuation funds engage‚ including asset allocation, investment manager selection, custody and fund accounting, member administration, group insurance and compliance.
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