Investors 'doubling up' on Aussie real estate

Investors 'doubling up' on Aussie real estate

Investors whose portfolios are dominated by domestic equities and Australian property should consider the diversification benefits of global listed real estate, says Quay Global Investors.


Speaking to InvestorDaily, Quay Global Investors principal and portfolio manager Chris Bedingfield said it is quite difficult for Australian investors to get access to assets that are not perfectly correlated with domestic equities.

Given that most Australian stock market investors are already invested in the local property market via their mortgage, they are probably "doubling up" on their Australian real estate exposure, Mr Bedingfield said.

However, he added he was certainly not trying to "talk anyone out of real estate", which he believes to be a "terrific asset class".

"[Real estate] is a great way to protect yourself from inflation and to preserve capital – if you buy it at the right price," Mr Bedingfield said.

"It may feel counter-intuitive, but if you actually had a piece of Australian real estate in a global real estate fund you’ve probably got more diversification than if you’ve just got Australian equities.

"For example, for the fund and the global real estate unhedged index, the correlation to the Australian share market is almost zero. So it’s a real diversification play," he said.

Mr Bedingfield set up Quay Global Investors with Justin Blaess in 2013, running an unhedged global listed real estate fund out of Sydney.

Bennelong Funds Management picked up the boutique fund manager in May 2015, and launched a retail version of the fund earlier this year.

The Quay fund currently has around $5 million in funds under management, and Mr Bedingfield said he will be "very disappointed" if the fund is not sitting at $50 million by the end of 2016.

Read more:

MSCI continues to shun China A shares

AMP under pressure to close China Growth Fund

New fixed income head for AMP New Zealand

Long-serving Suncorp executive retires

ETF sector hits record $23bn

Related Articles

 

Investors 'doubling up' on Aussie real estate
investordaily image
ID logo
promoted stories

Appointments

Neil Cochrane

First State Super CEO to retire

Reporter

Pally Bargri

AMP chief risk officer for advice departs

Killian Plastow

investordaily image

TCorp to expand investment business team

Reporter

Analysis

investordaily image

The perils of chasing niche infrastructure

Frithjof van Zyp

investordaily image

Finding global opportunities as volatility rises

Garry Laurence

Lucy O'Carroll

What causes recessions, and can we predict them?

Lucy O'Carroll