AB helps super fund smooth the ride for members

The Meat Industry Employees’ Superannuation Fund (MIESF) has chosen the AllianceBernstein Managed Volatility Equities Fund as part of a strategy aimed at lowering volatility in members’ portfolios.

The AllianceBernstein (AB) Fund invests primarily in Australian equities and is designed for investors seeking lower volatility, reduced downside risk in falling equity markets, the potential for long-term capital growth and some income, including franked Australian dividend income.

“We share the Fund’s objective of delivering lower-volatility investment performance, giving our members comfort that their capital is growing steadily during the accumulation phase and mitigating the sequencing risk around retirement,” said Mary McLaughlin, Chief Investment Officer of MIESF.

Jen Driscoll, Chief Executive Officer of AB in Australia, noted that AB’s innovative approach to navigating volatile market conditions was receiving growing support among investors, given its potential to play a role in both pre- and post-retirement solutions.

“We’re delighted to have been awarded this mandate, and look forward to working with MIESF in helping them to achieve their objectives for their members,” said Driscoll.

The Fund aims to reduce volatility by identifying, and investing in, high-quality listed equity securities that have reasonable valuations, high-quality cash flows and relatively stable share prices. While likely to lag the market during upturns, the Fund is expected to benefit from the so-called “low-volatility paradox”—a well-researched and well-documented phenomenon in which low-volatility stocks tend to outperform higher-volatility stocks on a risk-adjusted basis over time.

“Some of the Fund’s best relative returns since inception have been during months when the index fell sharply, while returns on the Fund fell significantly less,” said Roy Maslen, Chief Investment Officer—Australian Equities,

From inception in March 31, 2014, to February 28, 2015, the Fund returned 24.43% after fees[1]. This compared to a benchmark[2] return of 15.48%.

For a full description of the AllianceBernstein Managed Volatility Equities Fund’s features, benefits and risks please refer to the Product Disclosure Statement.