Diversification the key – Russell research
The importance of a diversified approach to investment has been reinforced by today’s release of the ‘2017 Russell Investments/ASX Long-term Investment Report’ which has identified the common pitfalls experienced by Australian investors.
The report has warned that there are genuine risks for Australian investors who steadfastly rely on a singular asset class to achieve long-term investment goals.
Commenting on the report, Russell Investments chief executive, Asia-Pacific, Pete Gunning said its findings showed why more savvy investors were considering diversified multi-asset strategies.
The key findings of the report covering the 10 years to December last year included that only residential property, global bonds and Australians bonds had exceeded a typical balanced fund target; that many growth assets disappointed, including Australian shares and hedged global shares; and that while Australian property was once the top performer, this asset class had shown a slight decline.
“Gunning said that when the findings of the report were taken into account, it was long past time for local investors to consider diversifying domestic exposures with global asset classes as well as alternative assets and strategies.
Russell Investments director, Consulting, Tim Cook said that in an investing environment facing lower returns, slower growth and overvalued markets, the company believed investors needed access to a wider and deeper set of alternative investment strategies to reduce their reliance on traditional return drivers.
“Otherwise, many will be unable to grow their assets sufficiently to meet their retirement or wealth-oriented goals,” he said.
Recommended for you
Janus Henderson is actively seeking to partner with private wealth firms in Australia as it looks to expand its number of strategic partnerships, as well as focus on retirement income product development.
Global investment manager First Sentier Investors has launched an umbrella brand to provide greater clarity around its shift to a multi-affiliate asset manager encompassing six investment teams.
Janus Henderson has seen intermediary outflows in the second quarter of US$1.2 billion, although its deal with insurer Guardian means overall net flows are US$46.7 billion.
Infrastructure assets are well-positioned to hedge against global uncertainty and can enhance the diversification of traditional portfolios with their evergreen characteristics, an investment chief believes.
