AustralianSuper takes investment management in-house
Big industry fund AustralianSuper has moved to take investment management substantially in house.
The fund announced the move this week, saying it represented a further initiative aimed at reducing costs and increasing net performance for its members.
The announcement said the initial focus would be on creating a hybrid internal/external management model with the establishment of an internal management team for Australian equities, which would start trading around the middle of next year.
Commenting on the move, AustralianSuper’s head of equities Innes McKeand said the fund believed it had the scale and capability to move from a model of almost entirely external management to one of a hybrid between external and internal investment managers.
“Internal investing is an excellent opportunity for a fund our size to extract further value from the portfolio, and global studies show that internal investment management typically costs three times less than external management for a similar return outcome,” McKeand said.
“Internal investing will bring a number of significant benefits to the Fund, with the target cost reduction at 10 basis points per annum over five to seven years and with the savings from internal investment increasing as the Fund grows,” McKeand said.
“Internal management will bring us closer to the market, give us greater control and increased capacity to access preferred asset classes.”
Recommended for you
ASIC has permanently banned a former Perth adviser after he made “materially misleading” statements to induce investors.
The Financial Services and Credit Panel has made a written order to a relevant provider after it gave advice regarding non-concessional contributions.
With wealth management M&A appetite only growing stronger, Business Health has outlined the major considerations for buyers and sellers to prevent unintended misalignment between the parties.
Industry body SIAA has said the falling number of financial advisers in Australia is a key issue impacting the attractiveness and investor participation of both public and private markets.
