Eleven Australian fund managers have made the grade to be named on the inaugural list of FE fundinfo/Money Management Alpha Managers.
In any given year there are fund managers who outperform their peers and, indeed, Australia has a handful of fund managers whose reputations are such that they have garnered a certain celebrity status but Alpha Manager status recognises career-long performance.
And the bottom line is that when FE fundinfo, the parent company of Money Management, looked at the top 10% of Australia’s retail-facing managers based on their track records over their careers, the following eleven managers emerged as Australia’s inaugural Alpha Managers.
What stands out from the list, is that while it contains some well-known and much-publicised names such as that of Magellan’s Hamish Douglas and Coolabah Capital’s
Christopher Joye it also contains some less well-known managers who have clearly been quiet achievers.
Importantly, amongst those quiet achievers is UBS Asset Management’s Anne Anderson, making her Australia’s first female Alpha Managers
To determine the ratings, FE fundinfo looks at a manager’s ability to create risk-adjusted alpha, outperformance in both rising and falling markets, and those who consistently beat their benchmarks.
Commenting on the launch of Alpha Managers in Australia, FE fundinfo Australia managing director, Mika-John Southworth said that the Alpha Managers concept was well-established and well-recognised in the United Kingdom, with some of Britain’s best-known managers had been recognised.
“We think the launch of the Alpha Managers in Australia represents a natural extension of what has been achieved in the UK and suitable recognition of the depth of experience which exists in the Australian funds management industry,” he said.
The Alpha Managers exercise will be the subject of a rebalance every 12 months.
FE FUNDINFO ALPHA MANAGER RATINGS METHODOLOGY
FE Fundinfo Alpha Manager Ratings rate the performance of a fund manager over their career including all the funds they have managed and the places they have worked at.
The ratings are designed to distinguish fund managers who have consistently performed well over the longer term.
The ratings are designed to exhibit the top 10% of fund managers analysed.
The methodology is comprised of two key components:
- Risk adjusted alpha/Sortino (with track record length bias); and
- Consistent outperformance of a benchmark overall.
The alpha component is weighted by its correlation to the benchmark, with the remainder (of the weight) coming from Sortino.
If a manager is a co-manager of any funds they will only receive half the weighting compared to any fund they are listed as lead or primary manager on.
Managers will not be considered for the rating if:
- They have active track record of less than 48 months;
- If a fund is managed by four people or more;
- Any management team;
- Any manager whose track record exhibits excessively high or low beta;
- Any person who only manages one fund and is deputy or co-manager (as distinct from lead manager). If they are deputy or co-manager of more than one fund then the following rules apply:
- If two funds then at least one must have a size of £100m (AUD equivalent at time)
- If three funds or more then at least one must have a size of £40m (AUD equivalent at time)
- If managing a single fund as lead, the manager must have a fund size £35m (AUD equivalent at time)
- If managing more than one fund and at least one of them as primary
- Where an individual holds the role of deputy manager on a fund this will not be considered for the rating; and
- Any passive or tracker funds will be excluded.