S&P removes 'on hold' from CFS strategies

Standard & Poor’s has assigned three-star ratings to two 452 Capital-managed large-cap Australian equities strategies distributed by Colonial First State.

The funds had been on hold since July 2009, when it was announced that 452 Capital co-founder and lead portfolio manager Peter Morgan would be taking extended leave for medical reasons.

“S&P has since met with 452 on a number of occasions, and we believe the team is functioning well and appears highly committed,” said S&P fund services analyst James Gunn.

“Although Morgan’s absence is a significant loss, we have sufficient confidence in the current team to continue to manage the funds during this period and beyond. Morgan was the lead portfolio manager and was ultimately accountable for the final portfolio, but investment decision-making and the determination of stock weights was always the collective responsibility of the three portfolio managers,” he said.

The affected funds are the CFS 452 Wholesale Australian Share and the CFS 452 Wholesale Geared Australian Share.

“The opportunity for the current team will be to capitalise on any extended period of more ‘normalised’ market conditions as a demonstration of its stock-picking abilities. Importantly for investors, 452 has remained true to label and not compromised its style or process, despite market conditions at times being significantly at odds with the manager’s conservative value approach,” he said.