Global equity products rise
The global equity space has seen a proliferation of new financial products, with 25 new products on the back of investor demand for global exposure.
The Lonsec Global Equities Sector Review, which reviewed 172 different global equity products in 2015/16, also found investors were also benefitting from other investment strategies such as smart beta, and alternative product structures such as separately managed accounts (SMAs), exchange traded funds (ETFs), and unlisted managed funds available through the Australian Securities Exchange (ASX) settlement service (mFunds).
General manager of equities, Peter Green, said the rising interest in this space could be due to good performance in the past, diminishing domestic market performance, and greater focus on portfolio diversification.
"Managed funds are still dominating the global equities sector, but a growing number of investors are recognising the benefits of ASX-listed alternatives, and the market has been responding to this demand," Green said.
Lonsec Research's fundamental growth peer group returned -1.7 per cent over one year amid a series of negative returns, while growth returned an average of 12.4 per cent per annum over seven years, compared to fundamental value products of 10.4 per cent. Fundamental core products returned -4.1 per cent over one year, and 11.2 per cent over seven years.
Meanwhile, only 33 per cent of value products outperformed over one year, while zero outperformed over longer periods. On the other hand, 69 per cent of growth products outperformed over one year, and 50 per cent outperformed over seven years.
Multi-manager products struggled across all periods, delivering 36 per cent over one year, nine per cent over three and five years, and 27 per cent over seven years.
AUTHOR
Malavika Santhebennur
Recommended for you
AUSIEX has announced it will acquire FIIG, a specialist fixed income provider with $4.5 billion in funds under advice.
Platinum Asset Management has announced it is in discussions with a global alternatives fund manager regarding a possible merger to create an $18 billion firm.
JP Morgan Asset Management has appointed an ETF specialist from Vanguard as it seeks to expand its ETF range.
The alternative asset manager has expanded its Singapore office with a head of Asian distribution, representing a “critical step” for the Asian business, where it is seeking to launch new offerings.
