Perpetual appoints new group executive
Perpetual has announced the appointment of Michael Gordon as group executive Perpetual Investments. Michael will lead the end-to-end business of Perpetual Investments, which includes product, distribution, operations and the investment management team – with $23.6bn in funds under management.
“We are delighted that Michael is joining Perpetual. He is an extremely experienced and talented leader of asset management businesses. Michael brings with him the international experience, the network and the understanding of our domestic market, as well as international credibility. He will work with Perpetual’s highly successful asset management team to develop growth opportunities,” said Perpetual CEO Geoff Lloyd.
Gordon’s career spans almost 30 years in the financial services industry within well-regarded global investment managers, in Australia, Asia and the UK. Since 2010, he has been BNP Paribas Investment Partners’ CIO for equities, responsible for over $60bn in funds under management.
Gordon also held a number of senior roles with Fidelity Investments International, including the roles of Global CIO, head of institutional investment and head of fixed income. During the 1990s, his career progressed with Schroders Investment Management in Australia, starting as a fund manager and finishing as MD & CIO.
This is the last key appointment in Geoff Lloyd’s hand-picked leadership team. Next month, Mark Smith will commence as group executive Perpetual Private, and in recent weeks both Rebecca Nash and Gillian Larkins have commenced in their roles as group executive People and Culture and Group Executive Transformation Office respectively.
These four new members of the Executive Leadership Team join Chris Green, group executive Corporate Trust, and CFO Roger Burrows to form the full team.
Australian Ethical wins SuperRatings Rising Star award
Australian Ethical Super won the Rising Star award at SuperRatings Fund of the Year awards in Melbourne.
“Australian Ethical was awarded our Rising Star award due to its significantly enhanced value for money with reduced fees and an improved insurance offering, while improving client service levels,” said SuperRatings CEO Nathan MacPhee.
“We are very proud to be recognised by respected industry researcher SuperRatings as a superfund that is increasingly providing great value for members, not just compared to other ethical or responsible investment options but compared to all the funds that SuperRatings surveys,” added Australian Ethical MD Phil Vernon.
“We have always had the highest conviction to ethical standards and believe our clients also deserve competitive investment returns, products and services. We have been on a path of improving these areas over the past few years and we are pleased that our efforts are recognised.”
Equity Trustees targets wealth management
The chairman of Equity Trustees (EQT), Tony Killen, told shareholders at the company AGM that, despite challenging economic circumstances, the business is in an industry that remains very attractive for the long term.
“As the size of the nation’s savings and investment pool grows, the population ages, and the complexity of the regulatory environment, tax system and markets all increase, the need for advice and services, and the wealth to be advised on, are both growing,” he said.
He added that the results for the first quarter of this year are comfortably ahead of last year’s – noting that in the same period last year, EQT had only two months of the aged care business it acquired and that some one-off expenses in the acquisition also impacted last year.
“Having said this, markets continue to be volatile. As a result, we find it difficult at this stage to be any more definitive about the first half result,” said Killeen.
Managing director Robin Burns told shareholders that EQT had taken a number of significant steps in the long-term strategic development of the company.
He said that the company had moved to being an integrated business with centralised support units supporting two revenue units, each solely focussed on the needs of one of the two client groups – private individuals and corporates.
“The purpose behind these changes is to intensify our focus on growing in the wealth management sector, within the broader financial services industry.”
New ETF opportunities revealed
The reconstitution of the Russell Australia High Value Index (RAHVI) and Russell Australia High Dividend Index (RAHDI) has revealed strong performance and new investment opportunities for Russell's two Australian equity ETFs.
The semi-annual reconstitution of the Russell indexes involves using the latest reporting season data to rebalance the weightings of stocks according to Russell's proprietary indexing methodology. Index construction is one of Russell's leading capabilities alongside capital markets insights, portfolio construction and implementation, manager research and in Australia, actuarial consulting.
The value index forms the foundation of the Russell Australian Value ETF (RVL) - which over the year to September 2012 has returned 18% (net of fees and expenses) to RVL investors. In the September rebalancing the index took a more cyclical, risk-on approach by underweighting its exposure to defensive sectors such as utilities, health care and consumer staples, which have become relatively expensive.
RAHVI substantially reduced/exited exposure to the five main defensive stocks in the market including Wesfarmers (WES), CSL Ltd (CSL), Woolworths (WOW), Treasury Wine Estates (TWE) and Cochlear Ltd (COH).
Russell Portfolio Manager, Scott Bennett said RAHVI and RVL had demonstrated a preference for financial and material sectors, finding favour with the major miners while the banks, despite rallying, looked more attractive relative to expensive larger industrials.
"Increases in market volatility and ongoing uncertainty with the Euro zone crisis, the future of China's growth and US markets have seen the valuation in the defensive stocks creep up. RVL is taking a more pro-cyclical bias in the hope of participating in subsequent rallies - having been a proven performer returning 18% over the year to September 2012," said Bennett.
New ETF launched
Vanguard will further diversify the choice available within its low-cost ETF range with the launch of the Vanguard Australian Fixed Interest Index ETF. It is expected that the new ETF will begin trading under the ticker code VAF later this month once regulatory approvals are complete.
The ETF offers investors access through the ASX to one of Vanguard’s flagship index funds via the new ETF share class which tracks the UBS Composite Bond Index™.
The ETF offers access to a diverse range of high credit quality Australian fixed income securities at a cost of just 0.20 per cent for a broadly diversified portfolio which includes allocations to government, semi-government and corporate bonds.
Speaking about the new ETF, Vanguard’s head of fixed income, Stephen Howard said: “Fixed income is an important diversifying component of investors’ portfolios – as recent years have shown – serving as a cushion to the volatility associated with equities.”
BetaShares Cash ETF reaches $100m AUM
The BetaShares Australian High Interest Cash ETF has reached $100m in assets under management, approximately seven months after its inception date, making it one of the fastest growing exchange traded funds (ETFs) launched in Australia.
“We are extremely pleased with the awareness of the High Interest Cash ETF within the investor community, especially considering the product was listed just earlier this year. The feedback received has been positive and this has been backed up by inflows to the fund,” said Drew Corbett, head of investment strategy at BetaShares.
“Looking back on the ETF industry over 2012, the most prevalent theme to date has been the use of yield products such as high dividend and cash to gain income exposures. While fixed income ETFs were also listed this year, they have yet to gain the traction of cash which is more familiar to investors.”
The recent addition of BT Financial Group to the Zenith Investment Partners (Zenith) client list has not slowed the growth of the Melbourne based research house, as a further six adviser practices have recently appointed Zenith research provider.
The new clients are:
Financial Foundations Australia Pty Ltd: Headquartered in the outer Melbourne suburb of Dandenong, FFA was established in 1983 and is one of the largest boutique financial planning practices in Australia.
Robert Lipman & Associates: Formerly the wealth advisory division of Investec Bank (Australia) Ltd the company has an impeccable track record of providing sophisticated portfolio management and financial advice to HNW clients, SMEs, associations, charitable trusts and foundations.
Premium Wealth Management affiliated businesses: SWU and Matthews Steer.
Commenting on the growth and new account successes, John Nicoll, Zenith head of sales and marketing, said “the two key areas driving interest from advisers at the moment is our alternatives team and our model portfolio reporting service. This provides advisers with a very detailed analysis of their portfolios, whether they are running the models themselves, or if Zenith is.”
AIOFP launches new website
The Association of Independently Owned Financial Planners (AIOFP) has launched a new web site designed to be an interactive tool for members and consumers alike.
The AIOFP see the challenges that will face the industry into the future, and is looking to bridge the gap between advisers and the consumer to help both parties gain a greater understanding of the complexity of the issues that face advisers, and how these issues impact on the consumer.
“At the end of the day we want to be able to help advisers give the best possible service to their clients. Consumers play an important part in ensuring they know how to get the best out of their adviser, by having a certain level of understanding of how advisers give this advice,” said Peter Johnston, CEO of the AIOFP.
“We are specifically looking to be more in touch with modern communication strategies, including blogs, Facebook and Twitter because that is the new generation’s preferred communication. Our research has shown that the Association is growing because we have excellent lines of communication with two conferences per year and constant flow of information to our members. This will now be even further enhanced with digital communication media.”
The first stage of the web site www.aiofp.net.au has also been developed to assist consumers find the right independently owned planning group to help them secure their financial future. It provides information on what services the AIOFP planners have available to give consumers including information on the value of financial advice.
The timing of the first stage launch has been coincided with the annual on-shore conference in Adelaide where over 120 delegates and industry leaders, including Senator Mathias Cormann, who will address the group at Parliament House on Friday at the last day of the conference.
CFS boosts team
Colonial First State Global Asset Management (CFSGAM) has today announced the appointment of four investment professionals to the listed property securities team, following Stephen Hayes re-joining CFSGAM as head of property securities in September.
Tuan Pham is re-joining CFSGAM as a senior portfolio manager. Tuan will specialise in Asian property securities and will be based in Sydney. Tuan was previously the head of Asia at Perennial Real Estate Investments.
Joseph Daguio is also returning to CFSGAM as an investment analyst for the Asia Pacific region and will also be based in Sydney. Joseph has extensive experience in the analysis of Australian and European property securities.
In Europe, Daniela Lungu and Boudewijn van Loen are joining the team as senior portfolio managers.
As a result of these changes, senior portfolio manager Antoinette Plater based in Sydney and portfolio manager Marco van Bussel, as well as investment analysts Matthew Gulczynski based in London and Miranda Moran based in Hong Kong have left CFSGAM.
Investment analyst John Stavliotis has accepted another role and will be finishing up at CFSGAM on Friday 2nd November 2012.
MLC’s new strategy
MLC has announced the introduction of a low correlation strategy in the MLC Horizon Series of portfolios and the MLC Long-Term Absolute Return Portfolio (MLC LTAR).
The strategy, which was launched in 2008, is a fund of hedge funds and will be managed by MLC’s alternative strategies team.
Initially, there will be three managers in the strategy:
Bridgewater Associates LP (Bridgewater), which runs a global macro hedge fund.
Nephila Capital Ltd (Nephila), which manages a portfolio of insurance-related investments.
Balestra Capital Ltd (Balestra Capital), which also runs a global macro hedge fund but has a different and complementary strategy to Bridgewater.
MLC has used the strategies of Bridgewater and Nephila in LTAR since 2007. Balestra Capital is a new manager for MLC.
Susan Gosling, Head of Investments for MLC Investment Management, said: “The low correlation strategy is an important next step in the evolution of the MLC Horizon Series, and will bring greater diversification to our hedge fund strategy in MLC LTAR.”
AMP’s University Challenge winners awarded $5,000
A team of students from La Trobe in Victoria has won the AMP University Challenge 2012 – a national financial planning competition open to all Australian university students who want to find out what it’s like to be a financial planner.
The competition, now in its second year, invites individuals or groups of up to three students to submit a scoped advice discussion paper in response to a hypothetical client case study. The top five teams then took part in a Finals Day at AMP in Sydney yesterday.
This year saw the number of submissions to the competition double, with a total of 57 compared to 24 last year. The number of students that took part increased from 42 in 2011 to 112 in 2012.
The winning team, which comprised Nathan Nicolaou and Andrew Cavaggion, was awarded the top prize by AMP Financial Services MD Craig Meller at a reception at AMP.
“The AMP University Challenge has taught me a lot about where financial planning is headed and how it is evolving. You get a real sense that the changes taking place are leading to a shift from financial planners being seen as service providers to becoming a fully recognised and embraced profession. It’s an exciting time to be involved,” said Nathan Nicolaou, a member of the winning team.
First prize was $5,000 cash for the winning team to share, along with registration to attend the AMP Planner Conference in Brisbane and a two-day internship with the Financial Review. La Trobe University also received a $10,000 donation to put towards financial planning initiatives.
Two separate teams from La Trobe University also won second and third prizes respectively, which were $2,500 and $1,000 cash.
Bennelong Fund achieved van Eyk ‘highly rated’ rating
The Bennelong Avoca Emerging Leaders Fund has been awarded a ‘highly rated’ rating by van Eyk. The Fund is managed by Avoca Investment Management, headed up by portfolio managers, John Campbell and Jeremy Bendeich.
“Many investors chase earnings momentum,” said Campbell. “By following the crowd, they focus on trends and miss inflection points in the equity markets. The Avoca team, however, seeks to identify and benefit from these turning points. We aren’t tempted to follow others’ investment decisions because we have absolute faith in our research and analytic methodology.”
Bendigo and Adelaide Bank AGM next Monday
Bendigo and Adelaide Bank will hold its 2012 AGM at 11.30am AEDST next Monday 29 October.
The meeting will be conducted across two locations, Bendigo and Adelaide, allowing the company to engage its large shareholder base in both cities.
Shareholders at The Capital Theatre in Bendigo and Intercontinental Adelaide will be linked via a satellite broadcast and the AGM will be webcast live, ensuring shareholders and investors across Australia and overseas can also watch the meeting.
Bendigo and Adelaide Bank chairman Robert Johanson and MD Mike Hirst will give their addresses from Adelaide. Other directors will speak at both locations.
Items of business to be considered at the meeting include:
The financial report and audit report for 2012.
Re-election of Ms Jenny Dawson, Ms Deb Radford and Mr Tony Robinson.
Amendments to the Bank’s constitution.
CFS buys into Finnish infrastructure
Colonial First State Global Asset Management (CFSGAM) has announced its First State European Diversified Infrastructure Fund (FCP-SIF), and has completed the acquisition of 100% of Digita Oy, Finland’s leading provider of television and radio broadcast tower infrastructure.
“Digita is a unique infrastructure business that enjoys a highly defensive market position operating in a mature industry. This investment is a core infrastructure asset that we expect will provide stable returns for our European Diversified Infrastructure Fund investors in the current challenging economic environment. Digita has a high quality network and we are committed to working with management to ensure the continued success and sustainable growth of Digita’s business over the long term,” said CFSGAM head of global infrastructure investments Perry Clausen.
CFS announces platform improvements
Colonial First State (CFS) has launched a new range of model portfolio and pension reporting enhancements which it claims delivers greater adviser efficiency across Australia’s most widely used platform, FirstChoice.
With more than $50bn in funds under administration, the recent enhancements to FirstChoice include licensee model portfolio templates, record of advice templates and enhanced pension reports.
GM product and investments, Peter Chun, said CFS is committed to the ongoing development of its products and online portal FirstNet Adviser, to meet the needs of licensee groups, advisers and their clients.
“We recognise the importance of a centralised approach to portfolio construction. We have introduced a range of tools to help licensees upload pre-constructed model portfolios, giving greater oversight and streamlining how investment recommendations are implemented,” he said.
“To help manage the compliance obligations impacting advisers, we have introduced a feature that enables licensees to create and assign Record of Advice templates. These templates will automatically generate each time advisers realign a client account to a model portfolio saving valuable time.”
CFS has also recently released a range of enhanced pension reports on FirstNet Adviser.
William Blair & Company expands team
Alex François has joined William Blair & Company as head of Australia and New Zealand institutional distribution.
François has more than 20 years of experience working with institutional investors throughout Australia and New Zealand, and brings with him a deep working knowledge of investment management requirements and portfolio implementation. He will report to Dan Charles, global head of business development and client service.
“Alex has a proven track record of leading investment management businesses in the Australian market and we are extremely pleased that he has joined our team,” said Michelle Seitz, CFA, head of William Blair Investment Management and a member of the firm’s executive committee.
“Despite the volatile markets, William Blair has been fortunate to have long-term consistent performance of its investment strategies, and we are excited about the opportunity to serve a fast-growing and sophisticated client base in Australia and New Zealand."