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聯絡: 美世回應

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Australia
Melbourne, 1 March 2010

Mercer has applied the lessons learned from the GFC to develop a new strategic asset allocation approach for its multi-manager funds. The new approach, which follows a major strategic review last year and takes effect from 1 March, is designed to give investors better protection against future periods of extreme market volatility, whilst continuing to provide competitive returns.

Last year’s strategic investment review – part of a regular cycle – highlighted the need for an improved method of risk classification, according to Russell Clarke, chief investment officer for Mercer’s investment management business.

“This regular review was timed to take stock and learn from the events of the global financial crisis to help improve investment structures and outcomes for clients. One of the key lessons the GFC taught us was that traditional industry asset classifications for multi-asset structures are too limited and overly simplistic. The traditional ‘growth’ and ‘defensive’ classifications have increasingly failed to fully capture the intrinsic risk of such structures,” he said.

In light of this insight, Mercer’s review aimed to reduce exposure to equity risk, achieve a more truly diversified portfolio to deliver better risk-adjusted returns and provide fund structures that allow greater flexibility.

“We set about achieving these aims by firstly redefining the traditional classification of risk to more accurately gauge the levels of growth and defensive characteristics within each of the various asset classes. We then looked for ways to better diversify our multi-asset structures to lessen the impact of future periods of downside,” Clarke said.

As an example, Mercer has implemented a new process that delivers a ‘two-dimensional’ classification of assets, which in turn provides a more sophisticated classification of investment risk. Rather than class an asset as either ‘growth’ or ‘defensive’, this new ‘Growth Defensive Enhanced’ (GDE) process recognises the mix of growth and defensive qualities within each asset class.

“Mercer’s preparedness to consider better methods of risk classification and actually implement this in our Funds will, we believe become best industry practice over time because it results in a better understanding of risk across the portfolio” said Mr Clarke.

Other key outcomes of Mercer’s investment review include:

• A greater allocation to more ‘real assets’ including direct property, infrastructure and natural resources: Mercer believes this will substantially improve the risk / return trade off as real assets can deliver growth like return and reduce the reliance on listed equity-style assets such as Australian and overseas shares. “Unlike some in the marketplace, we have not been caught with an over exposure to unlisted assets, but we are now expanding our exposure in this area at current depressed asset price levels” Mr Clarke said.

• Separation of sovereign bonds, credit and inflation-linked bonds within the fixed interest sector to better control risk: In the longer term, Mercer plans to hold more sovereign bonds, at the expense of credit exposures, to offer a more ‘true-to-label’ defensive fixed interest structure. “The GFC highlighted just how closely linked credit is to the strength of the economy and, therefore, to equity markets - it is a poor diversifier in multi-sector portfolios. Although current valuations and issuance of sovereign bonds lead us to be cautious in not expanding sovereign bond exposures at the current time, we do plan to progressively move to a higher allocation at the right time to do so,” Mr Clarke said.

• A more focussed approach to alternative assets: A stronger focus on those strategies that Mercer believes will provide genuine diversity, namely insurance-linked securities; along with a ‘carve out’ of previous alternative holdings to create new single sector fund choices in areas such as infrastructure and natural resources.

• Greater inflation protection: We believe the market has underestimated the possibility of an inflation ‘break out’ at some point over the next few years. To protect our funds against this possibility we have built in further inflation protection through holdings in inflation-linked bonds, natural resources, infrastructure and property.

• Increased exposure to emerging markets: Increasing allocation to emerging markets is an attractive strategy given that these economies are likely to grow, currencies are likely to strengthen and governance and transparency has improved.

“These outcomes are leading edge in an industry that’s only just beginning to reconsider the whole concept of investment risk,” added Gary Burke, head of Mercer’s investment management business in Australia & NZ. “At Mercer, we’ve gone well beyond considering it – we’ve already implemented multi manager solutions that institutional investors can now access to better manage their risk exposures.

“The full suite of Mercer Multi-Manager Funds (MMFs) now available offers an expanded investment universe, including natural resources and infrastructure funds, which are quite new to the multi-manager world. We’ve also created inflation-linked bond and global credit funds. This allows investors to tailor unique portfolios around their individual needs and risk assessments. Our investors will continue to enjoy the flexibility they’ve come to expect, and we believe they will continue to benefit from consistent outperformance, but now with better built-in protection against future periods of extreme volatility,” Mr Burke said.

Refer below for a summary of the new MMFs and their respective manager line ups.

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聯絡: 美世回應