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Pairing super funds and asset managers
Superannuation funds may benefit from partnering with asset managers to develop solutions for member challenges, according to AllianceBernstein (AB).
AB said longevity risk and market drawdown risk were significant challenges for the industry as fund members move from the accumulation phase to retirement.
AB Australia chief executive, Jen Driscoll, said "the industry has delivered extremely well for fund members in the accumulation stage, but the demographic transition to retirement poses a new challenge that requires fresh thinking".
"For that reason we think it's important for asset managers to listen carefully to funds to understand their members' needs, and then to work proactively with funds in meeting those needs," she said.
AB and Catholic Super's AllianceBernstein Managed Volatility Equities Fund was developed to meet the challenge of the risk that retirees will outlive their money, and the ability to preserve capital from the worst effects of market volatility.
Catholic Super chief investment officer, Garrie Lette, said "It's early days, but so far we are pleased not just with the alpha generated by the fund to date, but also by the way it has generated the returns, by protecting our members when the market falls".
"The portfolio is delivering the downside protection we were looking for".
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