Alternatives drive push for in-house investment trend
Superannuation funds are bringing investment functions in-house because technology has caught up to managing alternative investments, according to Oliver Johnson, E-Front sales director.
Johnson said super funds' interest in alternative assets had been on the rise due to low returns from traditional asset classes.
Because costs were at the forefront of new legislation, funds were bringing investment expertise in-house to avoid the high costs of investing in alternatives.
He said when a fund reached a certain size in its alternative asset allocation, it made less sense to outsource the portfolio and double-up on costs, which could be expensive.
"If they were a new super fund, to start up an alternatives platform, I think they wouldn't really get past the board pushing the adviser route anymore - just because of the fees," he said.
Johnson said new technologies that could handle the increased data burden of alternatives were facilitating super funds' move to boosting internal investment expertise.
Smaller funds were also hiring an investment manager or two off the back of technology that could assist in increased transparency requirements and data to provide the reasoning behind complex investment decisions, he said.
AUTHOR
Staff Writer
Money Management staff writers are writers who contribute to the website from time to time. If you would like to discuss the content contained within this article please contact us.
Recommended for you
The fund has launched a new campaign after finding many older tradies have lacked confidence understanding entitlements and missed pension income.
Unions and the Opposition have raised fresh concerns about APRA and ASIC’s failures amid fallout from First Guardian and Shield.
UniSuper chief investment officer, John Pearce, has shared his thinking behind why the $158 billion superannuation fund is yet to invest in cryptocurrency.
A new report has highlighted regulatory settings restricting super funds and reducing potential retirement balances for millions of Australians.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
211.16 3 y p.a(%)
2
Loftus Peak Global Disruption Fund Hedged
121.06 3 y p.a(%)
3
Global X 21Shares Bitcoin ETF
72.47 3 y p.a(%)
4
Paradice Australian Mid Cap A
69.09 3 y p.a(%)
5
Smarter Money Long-Short Credit Investor USD
68.96 3 y p.a(%)
