As speculation about the future market for lifetime annuities intensifies, the author of a pivotal recommendation to the Henry Review will present at an upcoming conference on post-retirement products.
New chapter in MTAA Super saga
The trustee of MTAA Super will directly employ its secretariat staff for the first time, as the fate of previous secretarial provider MTAA Ltd is shaped by a national meeting of motoring associations later this month, while the future of both organisations’ founder and boss, Michael Delaney, remains the subject of intense speculation.
Patrick McGorry's plea to group insurers
Group insurers are paying out up to $200 million a year for mental illness claims and much of this could be prevented, according to Australian Of The Year and mental health advocate, Patrick McGorry. JANA consultant poached to run client's private equity book
The $10 billion Telstra Super has hired a private equity specialist from its asset consultant, JANA Investment Advisers, to manage its private equity portfolio as it recovers from the loss of former alternatives head Nicole Connolly.
Hazel signs on at QIC…literally
Hazel signs on at QIC…literally As the global head of sales for Principal Global Investors, Hazel McNeilage was a high-profile hire for Queensland Investment Corporation late last year. But her reputation doesn’t precede her with everybody at the organisation. Meeting in the reception area of QIC’s Sydney office for an interview with the new head of funds management last month, Unbalanced was tickled to see the girl at the front desk insist that McNeilage sign in – and sign out when she left too, if she wouldn’t mind. Despite it being her third visit to the Pitt Street outpost, McNeilage admirably resisted any Belinda Neal-style “don’t you know who I am?”, and humbly signed in for access to the workplace of which she is now 2IC.
What’s wrong with our balanced approach?
Born out of the establishment of the industry super fund movement in the late 1980s, the Conference of Major Superannuation Funds (CMSF) celebrated its 20th anniversary last month. In this edited address to conference delegates, AIST CEO Fiona Reynolds outlines some of the major economic and social challenges facing Australia’s retirement incomes system and the $450 billion not-for-profit super sector.
Hedge funds down but investor interest up
Australian hedge funds [including offshore hedge funds offered to Australian investors] reported minus 1.14 per cent on average for the month of January 2010. Equity based hedge funds outperformed their long-only rivals that were hammered by the 6.18 per cent per cent drop in Australian equity markets. Australian long/ short equity hedge funds were down 2.45 per cent while market-neutral equity hedge funds reported a positive 0.08 per cent in January.
Put your fund’s head office in the cloud
As super funds become more complex beasts, so must their trustee offices. They will need to at least consider the possibilities of cloud computing if they are to keep up, argues RAGAV JAGANNATHAN, general manager of Microsoft solutions at the IQ Business Group. If you have anything to do with the typical Australian superannuation fund’s trustee office, you have probably asked yourself a version of the following questions – • How can I improve collaboration within the trustee office team and find, use and share information promptly to improve responsiveness to member needs? • How could the office better manage, track and report on organisational initiatives and projects, including where third parties are involved? • How can trustee board and sub-committes secretarial processes be improved?Funds managers report big increase in FIX usage
A survey of 20 major funds managers by consultant JOHN DIBIASE has revealed that FIX is close to becoming the dominant messaging standard for electronic trading, as dealers (or at least the order management systems they use) supplement or replace standards such as the long-dominant IRESS. The use of Financial Information Exchange (FIX) for electronic trading has been regarded as a necessary investment in most overseas markets but historically has had a low take-up by Australian investment managers. Shoreline’s 2010 survey has found electronic trading via FIX is well established and expanding compared to the 2008 survey: • Nine of the 20 participants use FIX for electronic trading – a significant increase from the three users in the 2008 survey • Asset classes traded electronically has expanded from equities only in 2008 to fixed interest, FX, and derivatives • Managers are taking advantage of higher value FIX functions such as allocations compared to simple order flow only usage in 2008 • Business drivers for FIX usage remain the same as 2008 – cost reduction and risk reduction
Fixing lost super without TFN? It’s Torture For Nothing, says industry
Easy, efficient use of the Tax File Number by super funds is a bit like motherhood: everyone wants it, but obstacles abound in its achievement and execution, while myriad parties have vastly different opinions on the optimum way to achieve the desired results. PHILIPPA YELLAND reports. It’s Miss Lonelyheart’s nightmare out there in Lost Superland: 4.8 million accounts totalling $13.6 billion; a reluctant and misunderstood matchmaker named Tax File Number; and a crowded ballroom full of interested, but frustrated, relatives lobbying Great-Uncle Jeremy to announce the new rules for easier courting, marriage, divorce and re-marriage. His recommendations for the new guidelines lobbed early last week under the title “SuperStream: a proposal to bring the back office of super into the 21st century”. Tucked away on page 19 is one of the most telling recommendations: that “Treasury be tasked with preparing a Privacy Impact Assessment to help identify and assess any privacy impacts of the ‘SuperStream’ proposals adopted by the Government”. And then on page 22 is another telling comment which rests on one word: “if ”.
Risk parity becomes bittersweet flavour of the month
A risk parity approach to asset allocation is flavour of the month, in spite, and because, of the leverage it requires, say Greg Allen, president and director of research at Callan Associates, and Steve Foresti, managing director at Wilshire Associates. The public castigation that the State of Wisconsin Investment Board [SWIB] received following its decision to use leverage in its new strategic investment direction, is testament to the philosophical leap required by pension boards in considering a risk-parity approach to asset allocation. On the surface, the theory makes sense: reduce the traditional allocation to equities so that diversification endures via a more equally-weighted allocation, and use leverage to increase the return.
How the search for yield hammered bond returns
When bond portfolios – the traditional defence for institutional investors – were smashed during the financial crisis, managers worldwide rushed to buy US government debt. This showed how far many had ventured beyond sovereign markets in their aim to outperform global aggregate fixed-income benchmarks – the catch-all indices for credit markets. Now, to better control the risks in their bond portfolios, some institutions are dictating which types of markets each of their bond managers can invest in, effectively disaggregating their credit exposures. SIMON MUMME reports.
