Rest has started trading global equities internally with a new $300 million mandate
Super fund Rest has funded an internal global equity strategy with $300 million. The Internal Global Equities team, led by Richard Mercado, had been running a paper portfolio for some time, before the strategy went live today.
Rest expects to progressively increase the allocation over the coming years.
There has been considerable focus on developing the investment philosophy to underpin an active stock-picking strategy focused on high-quality overseas businesses
“When we began to build this capability, we had a clear goal to deliver even more value to our 2 million members. By expanding our internal capabilities, we expect to continue delivering strong long-term performance at a lower cost,” Kiran Singh, Interim Co-Chief Investment Officer at Rest, says.
“We appointed Richard Mercado in November 2023 to lead this function, and since then we have built an expert team of five, including portfolio managers Fredy Hoh and Anna Chen.
“There has been considerable focus on developing the investment philosophy to underpin an active stock-picking strategy focused on high-quality overseas businesses.
“We have also undertaken further due diligence to confirm the mandate design is consistent with the opportunity initially identified at the whole-of-fund level and the team is operationally ready for live trading,” he says.
Internal Management to Complement External Managers
The start of the internal strategy doesn’t mean Rest won’t use any external managers in the future anymore. The internal global equities team is expected to provide additional benefits and insights to complement the work Rest does with its external managers, Singh says.
“We believe that in-house management of global equities will not only deliver cost benefits for our members, but will also enhance the overall knowledge and expertise within our broader investments team.
We believe that in-house management of global equities will not only deliver cost benefits for our members, but will also enhance the overall knowledge and expertise within our broader investments team
“An enriched exchange of ideas within our in-house management teams is instrumental in identifying additional investment opportunities and managing our risks more effectively. This ultimately positions the fund for further growth,” he says.
Rest has a long history of internal management, going back to establishment of Superannuation Investment Management (SIM), a fully-owned investment arm of Rest, in 1997.
SIM invested in cash, bonds, project finance debt, property, Australian equities, private equity and infrastructure asset classes, before the team was brought into the fold of Rest.
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