Page 767 – Investment Magazine

Funds mull currency strategy after 2008’s losses

06/08/202103/07/2009 by Staff Writer

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The financial year just gone has been challenging for super funds
in so many ways, none more so than in the management of their currency exposures.
In one month alone, last October, two weeks of manic volatility left the Aussie
dollar reeling with a drop of US20c. Many super funds had to write very large
cheques to cover their currency hedges. With the A$ back up over US80c, the
chances of a similar slump up ahead are not being discounted by market
observers.

Funds mull currency strategy after 2008’s losses

06/08/202103/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} The financial year just gone has been challenging for super funds in so many ways, none more so than in the management of their currency exposures. In one month alone, last October, two weeks of manic volatility left the Aussie dollar reeling with a drop of US20c. Many super funds had to write very large cheques to cover their currency hedges. With the A$ back up over US80c, the chances of a similar slump up ahead are not being discounted by market observers.

Pages: 1 2 3

Great Depression times three, or credit’s the place to be

07/02/201903/07/2009 by Staff Writer

Financial markets are pricing in corporate credit default rates more than three times higher than during the Great Depression, meaning super funds that invest in a highly diversified portfolio of investment grade credit are likely to be compensated for the risks that they are taking regardless of whether spreads still blow out, new research has found. Research from Melbourne-based Omega Global Investors titled High Investment Grade Credit Opportunities for Institutional Investors revealed implied default rates for US corporate bonds at March 31 this year were 38 per cent for corporates and 53 per cent for financials.

Great Depression times three, or credit’s the place to be

07/02/201903/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} Financial markets are pricing in corporate credit default rates more than three times higher than during the Great Depression, meaning super funds that invest in a highly diversified portfolio of investment grade credit are likely to be compensated for the risks that they are taking regardless of whether spreads still blow out, new research has found. Research from Melbourne-based Omega Global Investors titled High Investment Grade Credit Opportunities for Institutional Investors revealed implied default rates for US corporate bonds at March 31 this year were 38 per cent for corporates and 53 per cent for financials.

Pages: 1 2

IBM offers all channels as it puts its technology stamp on super administration

07/02/201903/07/2009 by Staff Writer

IBM Australia is this month rolling out a new digital telephone system for its super fund administration clients, including the Watson Wyatt client funds which were transitioned from April last year. Watson Wyatt, which last year switched administration outsource partners from the former CitiStreet Australia – subsequently bought by its former client Sunsuper – to IBM, has taken an active role in the new arrangement. It was IBM’s second big win of a group of corporate super fund clients, following a similar deal with Russell Investments when it entered the Australian market two years earlier.

IBM offers all channels as it puts its technology stamp on super administration

07/02/201903/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} IBM Australia is this month rolling out a new digital telephone system for its super fund administration clients, including the Watson Wyatt client funds which were transitioned from April last year. Watson Wyatt, which last year switched administration outsource partners from the former CitiStreet Australia – subsequently bought by its former client Sunsuper – to IBM, has taken an active role in the new arrangement. It was IBM’s second big win of a group of corporate super fund clients, following a similar deal with Russell Investments when it entered the Australian market two years earlier.

Pages: 1 2

Switching analysis finds members buying high and selling low

07/02/201903/07/2009 by Staff Writer

Super fund members are jeopardising their retirement savings by switching into higher risk investment options at the height of the market and into lower risk investment options as markets are falling, analysis of member switching behaviour by Watson Wyatt has revealed. Watson Wyatt analysed around 1750 switches by members in four of its corporate super fund clients and found they were demonstrating typical retail investor behaviour by buying high and selling low. The findings were based on data from funds in 2007 and 2008. In 2007, as markets were rising, “overwhelmingly people were switching into more risk”, according to David McNeice, principal of Watson Wyatt.

Switching analysis finds members buying high and selling low

07/02/201903/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} Super fund members are jeopardising their retirement savings by switching into higher risk investment options at the height of the market and into lower risk investment options as markets are falling, analysis of member switching behaviour by Watson Wyatt has revealed. Watson Wyatt analysed around 1750 switches by members in four of its corporate super fund clients and found they were demonstrating typical retail investor behaviour by buying high and selling low. The findings were based on data from funds in 2007 and 2008. In 2007, as markets were rising, “overwhelmingly people were switching into more risk”, according to David McNeice, principal of Watson Wyatt.

Pages: 1 2

Two years on, Deutsche’s back in Aussie bonds

07/02/201903/07/2009 by Staff Writer

Deutsche Asset Management (DeAM) has re-emerged with an active Australian fixed income mandate, just two years after selling its local businesses in bonds and domestic equities to Aberdeen Asset Management. The $120 million mandate is the first for the three-man team poached from Invesco’s Melbourne office a year ago – Chris Siniakov, Andrew Canobi and Steve Sutcliffe – and reflects a renewed interest in the asset class as governments and semi-governments bolster their debt issuance and increase opportunities for active management, according to DeAM’s Australian chief executive, Stephen O’Brien.

Two years on, Deutsche’s back in Aussie bonds

07/02/201903/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} Deutsche Asset Management (DeAM) has re-emerged with an active Australian fixed income mandate, just two years after selling its local businesses in bonds and domestic equities to Aberdeen Asset Management. The $120 million mandate is the first for the three-man team poached from Invesco’s Melbourne office a year ago – Chris Siniakov, Andrew Canobi and Steve Sutcliffe – and reflects a renewed interest in the asset class as governments and semi-governments bolster their debt issuance and increase opportunities for active management, according to DeAM’s Australian chief executive, Stephen O’Brien.

Pages: 1 2

QIC meets KIC in hunt for cross-border opportunities

07/02/201903/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} South Korea’s sovereign wealth fund (SWF), the US$25 billion (A$31.3 billion) Korea Investment Corporation (KIC), has signed cooperation agreements with Queensland Investment Corporation (QIC) and Malaysia’s Khazanah Nasional Berhad to share resources and pursue investments with the government-owned entities. Don Lee, head of alternatives at KIC, said the Korean government supported the fund’s aim to build direct relationships with peer SWFs in order to access further investment talent and investment opportunities, including co-investments.

QIC meets KIC in hunt for cross-border opportunities

07/02/201903/07/2009 by Staff Writer

Normal 0 false false false MicrosoftInternetExplorer4 st1:*{behavior:url(#ieooui) } /* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:”Times New Roman”; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} South Korea’s sovereign wealth fund (SWF), the US$25 billion (A$31.3 billion) Korea Investment Corporation (KIC), has signed cooperation agreements with Queensland Investment Corporation (QIC) and Malaysia’s Khazanah Nasional Berhad to share resources and pursue investments with the government-owned entities. Don Lee, head of alternatives at KIC, said the Korean government supported the fund’s aim to build direct relationships with peer SWFs in order to access further investment talent and investment opportunities, including co-investments.

Pages: 1 2

Funds mull currency strategy after 2008’s losses

Funds mull currency strategy after 2008’s losses

Great Depression times three, or credit’s the place to be

Great Depression times three, or credit’s the place to be

IBM offers all channels as it puts its technology stamp on super administration

IBM offers all channels as it puts its technology stamp on super administration

Switching analysis finds members buying high and selling low

Switching analysis finds members buying high and selling low

Two years on, Deutsche’s back in Aussie bonds

Two years on, Deutsche’s back in Aussie bonds

QIC meets KIC in hunt for cross-border opportunities

QIC meets KIC in hunt for cross-border opportunities

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