Fund Times: Updates for ING, Macquarie, Perennial, RREEF, Vanguard, Zurich
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In recent news from the funds management industry you may have missed, there have been major changes to ING's domestic large-caps team, while Macquarie has also lost a senior portfolio manager, and Perennial Fixed Interest a credit analyst. Elsewhere, Deutsche property arm RREEF has appointed a new analyst, Vanguard has switched benchmarks for its global bond and global credit funds, and Zurich has replaced DWS Investments with Renaissance for the listed property component of the firm's multi-manager multi-sector funds.
ING Large-Cap portfolio managers, analysts depart
ING Investment Management joint Directors of Equities Paul Cuddy and Mark East and analysts Michael Chun and Michael Malseed have all resigned. The group were responsible for the investment management for high-profile domestic share funds including ING Wholesale – Australian Share, ING OneAnswer Investment Portfolio – Australian Shares, and ING Wholesale – Blue Chip Imputation.
ING has moved quickly to appoint replacements in Guy Uding, a Senior Portfolio Manager from the firm's Asia Pacific investment team, and Tycho van Wijk, a Senior Portfolio Manager/Analyst from ING's European operations. James Wright, CIO Asset Strategies and Alternatives, has taken over management of ING's Australian equities team, while Head of Investment Process and Quantitative Services Michael Price (who also runs the firm's Sustainable Australian Shares funds) has assumed responsibility for the investment process and risk management elements of ING's Australian equities process.
At the time of our last assessment, we allocated ING's large-caps capability a Morningstar Recommendation of 'Investment Grade', commenting that the firm had implemented improvements and had apparently stemmed what we described as "what seemed incessant departures". In a panel discussion at this year's Morningstar Investment Conference, culture, morale, profit-sharing, and equity ownership were identified as the key elements in the 'war for talent' between boutiques and institutional funds management businesses. ING appears to have been unable to satisfy Cuddy, East, and their colleagues' ambitions in all these areas.
Our research analysts have met with Uding, van Wijk, and Wright, and are currently completing an update to our qualitative research report, which will be published shortly.
Macquarie senior portfolio manager leaves
Senior Portfolio Manager Geoff Wells has left Macquarie's large-cap shares team after 12 years. Wells reported to Patrick Hodgens, Head of Macquarie Funds Management Equities. As a result of the departure, the firm has promoted Suhail Metra to work alongside Hodgens, Genevieve Rainey, and Mark Harrison. Bruce Apted and Tuan Luu, currently working for Macquarie absolute return business MQ Asset Management, will also join the team in August. Our research analysts will revisit Macquarie's large-caps capability (currently 'Investment Grade') in several months' time, which will include assessment of the effects of these changes on funds such as Macquarie - Australian Enhanced Equities, Macquarie - Alpha Plus, and Macquarie - Active Plus Equities.
Credit analyst departs Perennial
Credit analyst Andrew McLachlan is leaving the Perennial Fixed Interest boutique. The firm said that analyst Jay Sivapalan would assume greater responsibility for assessment of non-government debt securities, while the firm has also transferred Ashley Kopczynski from its quantitative area into the credit team, reporting to Head of Credit Noel Murphy. Kopczynski joined Perennial in January 2007, having worked previously at Plum Financial Services. The funds affected most directly are Perennial Fixed Interest Wholesale and IOOF/Perennial Flexi Trust – Fixed Interest, which are not currently assessed by our qualitative research analysts.
RREEF hires domestic listed property analyst
Deutsche property funds management business RREEF has hired Eloise Mayne as Real Estate Securities Analyst, commencing 30 June. Mayne replaces Philip Cheetham, who recently left the funds management industry (as reported in Fund Times, 28 March 2008). She worked previously at Credit Suisse's Australian property securities business, and before that held positions in financial operations, audit, and taxation with Macquarie, PricewaterhouseCoopers, and Maple-Brown Abbott.
Mayne will report to Danny Ekins, the firm's Singapore-based Head of Real Estate Securities, Asia Pacific, and will contribute to the management of RREEF Paladin Property Securities. In our most recently-updated report on this strategy, published in February 2008 when we downgraded our Morningstar Recommendation from 'Recommended' to 'Investment Grade', we commented that the reduced focus from the lead manager, a swollen assets base, and changes to the investment team meant that RREEF was no longer among our most favoured listed property strategies.
Vanguard switches to Lehman Indices for global bond, credit funds
Vanguard has changed its benchmarks for Vanguard Wholesale - International Fixed Interest Index and Vanguard Wholesale – International Credit Securities Index. The global bond fund's index is moving from the Citigroup World Government Bond Index to the Lehman Global Treasury Index, while the credit fund is moving from tracking the Citigroup Non-BMS non-WGBI WorldBIG Bond Index to the Lehman Global Government-Related and Corporate Index. Vanguard cited ubiquity (the Lehman indices are increasingly the benchmarks of choice for global bond fund managers), greater vendor support and benchmark pricing integrity, and broader diversification as the rationale for the changes.
Zurich appoints Renaissance for Managed Growth funds
Zurich has appointed property boutique Renaissance Property Securities to manage the seven percent domestic listed property component of Zurich's multi-manager Managed Growth funds (Table 1), replacing DWS Investments' RREEF property business. Renaissance is already investment manager for Zurich's single-sector listed property funds, including Zurich Investments Australian Property Securities and Zurich Investments Australian Property Securities Retail. The Managed Growth funds' global property allocation, introduced in November 2007, is managed by Cohen & Steers.
Table 1: Ten Largest Zurich Managed Growth Funds
|Fund Name|| |
|Legal Type||Status|| |
Net Assets A$m
|Zurich Retirement Policy - Managed Growth||5987||Superannuation Fund||Closed||460.39|
|Zurich Super - Managed Growth Fund||4843||Superannuation Fund||Open||255.16|
|Zurich Wholesale Super - Managed Growth Fund||6378||Superannuation Fund||Open||238.45|
|Zurich Investments Managed Growth Fund||2734||Investment Trusts||Open||218.9|
|Zurich Super - Managed Growth Fund NEF||8660||Superannuation Fund||Open||52.18|
|Zurich A Pension (FIP) - Managed Growth NEF||6101||Allocated Pension||Open||40.06|
|Zurich A Pension (FIP) - Managed Growth||3965||Allocated Pension||Open||34.11|
|Zurich Investments Managed Growth Retail Fund||4573||Investment Trusts||Open||29.04|
|Zurich Deferred Annuity - Managed Growth DEF||3001||Superannuation Fund||Closed||22.86|
|Zurich Blended Series Managed Growth||10708||Investment Trusts||Open||15.82|