David Wright and John Nicoll, Zenith Investment Partners. Photo: Matt Fatches
The winners of the 2016 Professional Planner|Zenith Fund Awards were revealed at an event at Ivy Ballroom in Sydney on October 7. The awards recognise the best talent in the Australian funds management market, and cover 19 separate categories, including Distributor of the Year and the headline Fund Manager of the Year.
The 2016 Fund Manager of the Year is Bennelong Australian Equity Partners – with the manager also picking up top honours in the Australian equities – large cap and Australian equities – small/mid/micro cap categories.
The 2016 Distributor of the Year is Pinnacle Investment Management. Its affiliated managers include Resolution Capital, winner of the global REIT category, and Antipodes Global Investment Partners, winner of the international equities – alternative strategies (long/short global, long/short regional, income overlay (options)) category.
More than 330 representatives of the leading fund management organisations attended the awards, co-hosted by Zenith Investment Partners managing partner David Wright and national sales manager John Nicoll. The event was produced by Conexus Financial, publisher of Professional Planner, and sponsored by Fundamental Media.
1. Organisational strength
2. Investment philosophy
3. Investment process
4. Investment team
5. Security selection
6. Security valuation
7. Portfolio construction
8. Risk management
9. Performance.
Quan Nguyen, a senior investment analyst with Zenith, says the finalists and the winners of the awards are “of high quality; they’ve built sustainable businesses, outperformed consistently, and delivered upon their investment objectives”.
“They’ve got strong investment personnel, top-notch infrastructure, good investment process and culture,” he says.
“We make an assessment of the organisation, the team, investment process and unique features. We look at performance as well, and whether or not they’ve delivered on objectives and, going forward, do we think that they are able to deliver upon objectives?”
Nguyen says Zenith assesses the capability of the fund manager, and the rating of the manager’s capability flows on to the individual products and portfolios that draw on that capability.
Nguyen says the winners of the fund awards aren’t necessarily expected to shoot the lights out on performance every year, but the research house has a high level of confidence that the managers will deliver on their stated investment objectives.
“There wouldn’t be any blow-ups; there wouldn’t be any disasters,” Nguyen says.
“We’re expecting these guys to consistently deliver upon objectives – and that might be that some of these funds are 1 per cent over or just outperform their benchmark, not necessarily being 10 per cent over, for instance.”
Nguyen says competition in the funds management market continues to increase, and it has “been tough” over the past 12 months.
“There’s been a big move towards low-cost strategies,” he says.
“There’s been a move towards low-cost strategies where the ones that have done well have retained and grown their FUM.”
Nguyen says the market continues to attract newcomers, which puts pressure on research businesses to decide when it is appropriate to start analysing and rating new managers and products.
“We make an assessment of the capability and if it looks compelling we will go ahead,” he says. “That means if it stacks up versus what we have already in the current peer set, we’re happy to go ahead.
“They still have to meet our criteria of having a solid business and a solid team. That needs to still check out. We’re in a position where we do not have to rate everyone, so we only rate the funds we believe are compelling and are best of class.”
Nguyen says increased competition has kept established players on their toes.
“For every one that’s done well, you can probably on the other hand count the ones that have not done well, among new entrants. Some have done quite well, some haven’t,” he says.
“But when you say ‘do well’, it depends on what your definition is. Does it mean perform well and meet objectives? Does it mean do well as in raising assets? It has to meet both, really – meet objectives, and raise funds. There’s no point having a fund that shoots the lights out every year and is not able to raise capital because there’s no marketing support.
“The worst thing is for [a fund] to shut down because it has not been able to raise money, through no fault of its performance, but because the marketing support hasn’t been there, and then investors are forced out of the fund because they shut it down because it’s not viable.”
Conversely, Nguyen says, it’s not enough to simply have some giant marketing machine peddling substandard products and capabilities to advisers and investors.
“Ultimately it needs to perform as well,” Nguyen says. “You can market it well, but at the end of the day if you don’t perform, I don’t think people will stick with you.”
And the winners are:
Click on a category title to go to the full awards coverage
