Australian superannuation funds should manage equity portfolio implementation through a centralised provider on a single, according to Parametric.
Director of research and after tax solutions Raewyn Williams believes portfolio implementation and execution should be separate from investment idea creation and should be managed through a centralised portfolio management (CPM) manager.
Referring to a research paper from Towers Watson titled ‘Centralised Portfolio Management', Williams said CPM can retrieve value lost from tax.
The paper said the CPM manager "implements trades put forward by the portfolio's underlying active managers, taking a whole-of-portfolio focus with an aim to minimise transaction costs and tax, while balancing the tracking error introduced relative to the underlying portfolio."
But Williams said not all CPM methods are the same
"It is important to differentiate in particular between tax-managed CPM and old-style emulation solutions which may have in-built lagging conditions and continue to ignore tax in the way the portfolio is managed and outcomes measured," she says.
The central bank has announced its latest rate decision amid stubborn inflation and increasing geopolitical tension.
Aware Super has outlined its systematic approach to corporate engagement as institutional investors increasingly assert their influence on company boards and take on an active stewardship role.
The country’s second-largest super fund has completed its fourth SFT this past financial year and welcomes almost 5,000 new members.
The corporate fund has announced it is seeking a suitable merger partner as the number of corporate super funds in Australia continues to dwindle.
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