Aware increases in-house management target

Industry fund Aware Super has increased its target for internally-managed funds, as it seeks to take advantage of the cost savings from in-house management.

In 2021, the industry super fund, which had more than $150 billion in assets under management, said it was targeting 40%.

At the time, it said: “Aware plans to increase the proportion of its internally-managed assets across its portfolios from around 20% to 22% currently to around 40% over the next five years.”

This included Australian equities, international equities, cash and fixed income.

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It had now increased this percentage to 50% by 2025, covering all asset classes.

The option of whether to bring fund management in-house or have it managed by external third parties was a divisive decision with some funds opting to have large proportions in-house and others opting out completely.

Australian Retirement Trust and Hostplus have both stated they are avoiding in-house management as they feel it is difficult to retain talent and they can negotiate better deals with external managers.

On the other hand, UniSuper had over 70% of its funds under management managed internally and Australian Super was targeting more than 75% as they believe it reduced investment fees and total costs for members.