The $3.4 billion Government Superannuation Fund, which provides pensions to government employees, is moving from a very conservative asset allocation to one with far more risk.
Currently the fund is almost entirely invested in Government Bonds. However, to improve its performance and reduce the annual cost to the Crown it is moving to an asset allocation that is two-thirds shares and one-third bonds.
The current proposed long run strategic asset allocation for the fund is:
|
International equities |
52.5% |
|
NZ equities |
12.5% |
|
International bonds |
21% |
|
NZ bonds |
14% |
The trustees are planning to shift the fund's assets gradually over the next two years through a tender process.
Public Trust posts a loss
The Public Trust lost nearly $5.6 mill in the year to June, but says things are looking up.
Once Parliament passes a new law the office will be compensated by the Government for its will writing service which is currently free and it will be able to charge a management fee of about 1.1% on its group investment funds.
Public Trust chief executive Tim Sole says other changes will need to be made to get the office's profit level up to an acceptable level.
During the past financial year the PTO reported an operating profit of $170,000 compared to a loss of $3.5 mill the previous year. During the year it increased its revenue 2% to $48.5 mill and operating costs were reduced to $48.3 mill.
One-off write-downs and changes to accounting policies turned the small operating profit into a $5.6 mill loss.
One well-seasoned manager
Tower Asset Management is adding a bit more spice to its funds management team by appointing "seasoned generalists". The latest generalist to enlist is Guy Hutchings.
TAM chief executive Paul Bevin says he is using seasoned generalists as Tower offers a wide range of diversified products in the market place and therefore required strong investment generalists to oversee the management of these portfolios to ensure they met client strategies.
The role encompasses investment strategy and implementation, including supervision of asset management specialists, as well as liaison with consultants and clients.
Because Tower uses a multi-manager structure it needs people with a deep understanding of portfolio management principles and practice plus the ability to monitor all of the external managers' investment processes and articulate them credibly to asset consultants and research houses.
FPIA Convention update
Organisers for next year's Financial Planners and Insurance Advisers Association convention have signed up five major sponsors so far. They are:
Platinum: AMP Financial Services, BT Funds Management
Gold: AXA, Armstrong Jones and Sovereign.
For the latest convention news visit the FPIA Convention page here.
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