State Super has awarded a Chinese equity mandate to Ninety One (formerly Investec Asset Management).
State Super senior investment manager Andrew Huang said the fund had searched for niche opportunities for its Global Best Ideas satellite manager portfolio.
“An all shares approach to China was the most compelling due to high alpha potential while diversifying beta,” Mr Huang said.
“Skilled alpha hunters should thrive well in this broad and highly inefficient retail driven market.”
He added Ninety One’s process should be well suited for generating alpha in one of the world’s “most liquid and inefficient equity markets”.
“We believe the strategy’s focus on exploiting behavioural biases and disciplined fundamental research are important advantages for this market,” Mr Huang said.
“During an increasingly uncertain political climate, we also required a manager with very high standards of ESG integration in portfolio construction and corporate engagement.”
Justin Cowper, head of the institutional business for Ninety One in Asia Pacific and Middle East commented many Australian institutional investors have resisted a discrete allocation to Chinese equities, “given China’s close trading links to Australia and the potential double up in exposure through their Australian equities and emerging markets allocations”.
State Super however, has done something different and seen the potential in the China A-shares market, Mr Cowper said.
Ninety One now manages $205 billion with $92 billion in listed equity investments.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
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