Auscoal Super is designed for members working in coal mining and other related industries and has over $7.4 billion in funds under management.
For the past seven years, SSgA has managed currency hedging for the super fund’s $1.6 billion international equities portfolio via a passive overlay program.
SSgA director of distribution Peter Mitchell said dynamic strategic hedging will enable Auscoal Super’s investment team to take a more active approach to the portfolio’s currency management.
He added that it will further diversify the portfolio and increase returns while minimising currency risk, particularly downside tail risk.
Auscoal senior portfolio manager Michael Berry said the move to a more creative and collaborative hedging strategy is in line with Auscoal Super’s decision to manage currencies more dynamically through the business cycle.
“We felt SSgA’s Australia-based currency team, with their consultative and systematic approach in strategically managing currency, was a good fit with our team and with the direction in which we’d like to take the fund,” said Mr Berry.
