Private equity fund valuations should
fall by almost one fifth by the end of the first quarter, and could fall another
12 per cent in the second, according to research from alternatives boutique
Barwon Investment Partners. While major indexes worldwide fell by roughly 40
per cent in 2008, the reporting lags inherent in valuing the net asset values
(NAVs) of private equity funds meant the average vehicle declined between 15
and 25 per cent in value in the second half of 2008, and would continue to
descend until mid-2009, Barwon wrote in a recent paper, Private equity NAVs:
where are they heading?
Private equity NAVs to fall further, but 80
Private equity fund valuations should fall by almost one fifth by the end of the first quarter, and could fall another 12 per cent in the second, according to research from alternatives boutique Barwon Investment Partners. While major indexes worldwide fell by roughly 40 per cent in 2008, the reporting lags inherent in valuing the net asset values (NAVs) of private equity funds meant the average vehicle declined between 15 and 25 per cent in value in the second half of 2008, and would continue to descend until mid-2009, Barwon wrote in a recent paper, Private equity NAVs: where are they heading?
Rollover relief on deck, Maritime Super sets sail
The $2.6 billion Maritime Super will conduct a full review of its investment portfolios over the next 12 to 18 months on the back of the long-awaited merger of the two maritime industry super funds on March 1. The merger between the $1.5 billion Stevedoring Employees Retirement Fund (SERF) and the $1.1 billion Seafarers Retirement … Read more
Funds urged to consider cost of not rebalancing
The cost of a standard Australian equity trade has risen by more than 10 basis points during the financial crisis, prompting super funds to think carefully about the way in which they rebalance portfolios. According to State Street’s Transaction Cost Analysis, the average equity transaction cost in Australia rose from 25 basis points in 2007 to 38 basis points in 2008. However the cost for a fund of not rebalancing could be even higher, according to Thomas Chevrier, head of research at State Street Associates, Asia-Pacific.
Funds urged to consider cost of not rebalancing
The cost of a standard Australian equity trade has risen by more than 10 basis points during the financial crisis, prompting super funds to think carefully about the way in which they rebalance portfolios. According to
State Street’s Transaction Cost Analysis, the average equity transaction cost in
Australia rose from 25 basis points in 2007 to 38 basis points in 2008. However the cost for a fund of not rebalancing could be even higher, according to Thomas Chevrier, head of research at State Street Associates, Asia-Pacific.
Move away from flat super fees, urges Mercer
Industry funds should consider charging more for administration and doing so on a percentage-of-assets basis, to help retain nervous members and to survive any future automatic account consolidation regime, according to Mercer executives Russell Mason and David Anderson. Mason is Mercer’s national business leader for multi-employer superannuation, and Anderson the business leader for outsourcing. There are approximately three superannuation accounts for every Australian worker, so funds which rely on a fixed fee per account face a “one-third to two-thirds” reduction in their operating revenue if an automatic account consolidation regime is introduced, according to Anderson.
Move away from flat super fees, urges Mercer
Industry funds should consider charging more for administration and doing so on a percentage-of-assets basis, to help retain nervous members and to survive any future automatic account consolidation regime, according to Mercer executives Russell Mason and David Anderson. Mason is Mercer’s national business leader for multi-employer superannuation, and Anderson the business leader for outsourcing. There are approximately three superannuation accounts for every Australian worker, so funds which rely on a fixed fee per account face a “one-third to two-thirds” reduction in their operating revenue if an automatic account consolidation regime is introduced, according to
Anderson.
‘Private debt’ a timely new investment for recession
At a time when investors have become cautious about immediate prospects for private equity, but are bullish on corporate debt, a new asset sub-class seems to be emerging – private debt. Specialists in the field say that assessing companies for debt instruments requires a different set of skills to that of private equity investments. Causeway Asset Management, a private debt manager formed in 2003, is offering a new strategy for Australian institutional investors, which will focus on the SME corporate debt market. Until 2007, Causeway focused on running proprietary portfolios for its joint-venture partners, including a Canadian consortium bank.
‘Private debt’ a timely new investment for recession
At a time when investors have become cautious about immediate prospects for private equity, but are bullish on corporate debt, a new asset sub-class seems to be emerging – private debt. Specialists in the field say that assessing companies for debt instruments requires a different set of skills to that of private equity investments. Causeway Asset Management, a private debt manager formed in 2003, is offering a new strategy for Australian institutional investors, which will focus on the SME corporate debt market. Until 2007, Causeway focused on running proprietary portfolios for its joint-venture partners, including a Canadian consortium bank.
TAA pioneer Peter Higgs branches into global equities
Tactical Global Management (TGM), the specialist Australianowned asset allocation manager, has diversified its business through the launch of a market-neutral global equity fund. The TGM Tactical Global Equity Fund will be run from the firm’s London office by a new team including Hicham Najem, Priya Parameswaran and Adrian Luck, reporting to the firm’s founder, Peter Higgs, who is also based in London.
TAA pioneer Peter Higgs branches into global equities
Tactical Global Management (TGM), the specialist Australianowned asset allocation manager, has diversified its business through the launch of a market-neutral global equity fund. The TGM Tactical Global Equity Fund will be run from the firm’s London office by a new team including Hicham Najem, Priya Parameswaran and Adrian Luck, reporting to the firm’s founder, Peter Higgs, who is also based in
London.
Scale helps Sunsuper cut fees, keep big pension accounts
A combination of scale and forecast cost savings of running member administration and financial planning inhouse enabled the $12 billion Sunsuper to make a recent fee cut across pension accounts. The move echoes BUSS(Q)’s move two years ago to abolish all fees for allocated pensioners, although that has failed to attract as many of the high account balances as was hoped. In March, Sunsuper announced a 0.1 per cent reduction in fees, to 0.25 per cent, for the first $300,000 of pension accounts.
