Key Takeaways
- • Future Fund CIO Ben Samild says the A$252.3 billion sovereign wealth fund is weighing an expansion of the active equity program it re-launched in 2023, with the team assessing where its equity portfolio is best deployed.
- • The Future Fund returned 12.2% in the year to 30 June and added A$27.4 billion of assets under management through investment returns.
- • Emerging markets were the first focus of the expansion: Samild said the fund "did more in emerging markets this year" and expects other regions to be included over the next couple of years.
- • The fund is diversifying away from the US amid political uncertainty; chair Greg Combet called the US a "more risky and uncertain investment destination" and flagged Japan and the EU as priorities.
- • Existing active equity exposures include Effissimo Capital Management (Japanese activist), Wellington Investment Management (Japanese equities) and Maple-Brown Abbott (Australian small caps); no new active emerging market managers had yet been added to the manager list.
Summary
Ben Samild, chief investment officer of the Future Fund, the Australian sovereign wealth fund with A$252.3 billion under management, said the investment team is evaluating opportunities to expand the active equity program the fund re-launched in 2023, according to Top1000funds.com. Speaking on a media call for the fund's results, Samild said the team was "constantly analysing where the best place for our equity portfolio is and how it is best expressed."
The fund reported a 12.2% return for the year to 30 June, adding A$27.4 billion in assets under management through investment returns. Samild said there are "real opportunities elsewhere in other markets where we can observe real inefficiencies," describing the effort as a long-term framework and program. He noted the fund had done more in emerging markets during the year and would expect other regions to be included over the next couple of years.
The Future Fund's previous active equity investments include an allocation to Effissimo Capital Management, a secretive Japanese activist hedge fund first reported by Investment Magazine, and a separate Japanese equity mandate with Wellington Investment Management. The fund has also invested in active Australian small caps through Maple-Brown Abbott. The manager list has not yet been updated to include new active emerging market equity managers.
The move fits a broader diversification theme. In a June speech, Future Fund chair Greg Combet described the US as a "more risky and uncertain investment destination" and said more time and resources should be devoted to Japan and the EU. On the call, Samild said the fund had been moving to invest across asset classes in both jurisdictions, stating, "We have been investing actively across the capital stack in both [Japan and Europe]."
The fund reported a 12.2% return for the year to 30 June, adding A$27.4 billion in assets under management through investment returns. Samild said there are "real opportunities elsewhere in other markets where we can observe real inefficiencies," describing the effort as a long-term framework and program. He noted the fund had done more in emerging markets during the year and would expect other regions to be included over the next couple of years.
The Future Fund's previous active equity investments include an allocation to Effissimo Capital Management, a secretive Japanese activist hedge fund first reported by Investment Magazine, and a separate Japanese equity mandate with Wellington Investment Management. The fund has also invested in active Australian small caps through Maple-Brown Abbott. The manager list has not yet been updated to include new active emerging market equity managers.
The move fits a broader diversification theme. In a June speech, Future Fund chair Greg Combet described the US as a "more risky and uncertain investment destination" and said more time and resources should be devoted to Japan and the EU. On the call, Samild said the fund had been moving to invest across asset classes in both jurisdictions, stating, "We have been investing actively across the capital stack in both [Japan and Europe]."
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