Median managers post solid year across board
Median managers across all major investment classes posted above index performance for the past financial year according to statistics released by Morningstar as part of its Institutional Sector Survey.
The survey covers the performance of Australian institutional investment strategies to 30 June 2014 and found the median Australian share fund manager outperformed the index by a margin of 0.8 per cent. In doing so, median returns were 18 per cent over the past financial year while longer-term annualised returns were 11.3 per cent over three years and 11.8 per cent over five years.
A number of managers were able to outperform the index by about a third with Allan Gray returning 25.7 per cent, Millinium returning 25.4 per cent and Dalton Nicol Reid returning 24.6 per cent ranking as the three best performers in the sector.
The return of median international equities managers was also 0.8 per cent above the index at 21.2 per cent for the financial year, and at 17.1 per cent over three years falling to 12.2 per cent over five years. Leading managers who performed around 4 per cent higher than the index were GMO returning 24.5 per cent, Platinum returning 23.9 per cent, and AXA returning 23.7 per cent for the past financial year.
The Australian Real Estate Investment Trust (REIT) sector also saw the median manager outperforming the index with the median manager returning 11.7 per cent, slightly above the index's 11.1 per cent. Leading performers were SGH (14.7 per cent), Challenger (14.4 per cent), and Ibbotson (14.2 per cent).
Morningstar said across the last 12 months growth assets produced strong results with international shares recording 20.4 per cent, Australian shares 17.2 per cent, international property 15.8 per cent and Australian property generated 11.1 per cent.
However for the month of June value-style Australian shares outperformed growth-style shares with the S&P Australia BMI Value Index returning -10.8 per cent compared to the S&P Australia BMI Growth Index's -20.6 per cent. The margin between the two styles over the year remained close with growth-style equities returning 17.8 per cent while Value-style equities returned 17.0 per cent.
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