Australian managers defy global trend

The rate of growth in the total assets being managed by the world’s largest 500 fund managers rose at its slowest rate in five years in 2007, but Australian managers were something of an exception, according to new research released by Watson Wyatt.

According to the Pensions & Investments/Watson Wyatt World 500 ranking, total assets managed by the largest 500 fund managers grew by around 9 per cent in 2007 to US$69.4 trillion compared to a growth rate of 19 per cent the pervious year.

However, by contrast, assets under management by Australian fund managers grew by 19 per cent in 2007 to US$691 billion.

According to the head of manager research at Watson Wyatt Australia, Hugh Dougherty, the outperformance of Australian fund managers is largely owed to the impact of the superannuation guarantee charge and the compulsory flows it has generated.

There are 15 Australian managers covered by the Watson Wyatt survey and several increased their ranking, including Colonial First State.

Commenting on the outcome, Dougherty said that the Australian managers that had increased their rankings were those that were broadly diversified.

He said managers purely focused on equities or property had encountered a somewhat different outcome, and this was a trend that was likely to have been exacerbated in more recent months.