Fund managers with globalised investment teams, which include both domestic and offshore resources, delivered higher returns on average (6.2 per cent) across the Australian fixed-income space compared to their Australian-only counterparts, which delivered on average 5.7 per cent over the past decade.
However, that came with higher risk as globalised teams recorded annualised volatility that was 0.15 per cent higher, according to Zenith Investment Partners’ analysis.
Zenith’s head of Australian fixed income, Andrew Yap, said that speaking from the financial advisers’ point of view, each approach had its advantages.
“While globalised teams are potentially at a relative advantage with respect to the timely research of offshore companies issuing bonds in Australia, this can be offset by a local player if they have superior interest rate management or savvy trading skills,” he said.
Zenith said it has increased its coverage across the Australian fixed-income asset class with an addition of five new funds from Perpetual, CC JCB, Realm, Daintree and State Street.
From an investment universe comprising 97 funds, Zenith assigned 46 active ratings across bonds, corporate debt, specialist, cash enhanced and cash.