Global asset manager AllianceBernstein (AB) announced today that multi-manager Alpha Fund Managers has become the initial investor in the AllianceBernstein Global Equities Fund.
“We are delighted to join Alpha Fund Managers’ strong and distinguished line-up of managers,” said Jen Driscoll, AB’s Chief Executive Officer—Australia. “We look forward to complementing their offerings with our differentiated approach to delivering consistent and competitive investment returns.”
The underlying strategy of the Fund—which aims to produce consistent returns over a rolling three-year period—has built a 10-year record of outperformance by focusing on companies’ cash earnings rather than relying on reported accounting profits as a guide to stock selection.
“We believe that adding AllianceBernstein Global Equities Fund to our portfolio will create value for our clients,” said Rod Bristow, Managing Director of Infocus Wealth Management, the parent company of Alpha Fund Managers. “The strategy has a strong performance record, clear investment philosophy and a long-standing investment team.”
The Fund aims to produce strong returns over time by owning companies which generate robust and sustainable returns on capital, and by buying them when they are attractively valued. According to Klaus Ingemann, AB’s Portfolio Manager and Senior Research Analyst, the key to identifying such companies lies in focusing on cash-based earnings.
“Many investors rely on reported accounting profits to guide their stock selection, but this creates risks, in our view,” said Ingemann. “Accounting data inherently contain distortions, making comparison between companies difficult. We believe share prices should reflect real, cash-based earnings and their sustainability.”
The benefits of this approach are enhanced by constructing portfolios that avoid or reduce particular biases, such as being materially exposed to certain investment styles, regions, sectors or macroeconomic factors.
“This approach allows stock selection, rather than factor exposures, to drive returns,” said Ingemann.
Source: AB
