Rest has launched an internal global equities function to be led by portfolio manager Richard Mercado.
Mercado will establish and build a dedicated internal global equities management capability as the $75 billion fund embarks on its internalisation strategy.
Mercado joins the super fund from Comgest in Paris, where he was a high conviction portfolio manager specialising in global equities. Prior to that, he worked at USS Investment Management, which is the largest pension fund in the UK, as a senior portfolio manager.
The move to Rest is a return back to Australia for Mercado after 16 years away, having worked at AMP Capital Investors and Macquarie before he left in 2008.
Mercado will report to Kiran Singh, head of listed assets, and will be based in Sydney.
Andrew Lill, chief investment officer at Rest, said: “We are committed to continuing to deliver strong long-term returns and keeping our fees as low as possible.
“Our Core Strategy investment fees and costs for the 2022/23 financial year were the lowest they’d been in recent years. Using our scale and expertise to build further internal capability aims to help us realise further value for our members. This is another demonstration of the continued evolution of Rest’s whole of fund approach.
“We've found that internal management can provide additional benefits and insights to complement the work we do with our external managers. This gives us a more holistic view of how companies are contributing to our overall portfolio and our sustainability goals.”
In FY22–23, Rest’s MySuper Core Strategy option returned 9.2 per cent and the fund cited overseas equities as being a contributor to positive performance during the year.
“Even within the asset classes, we also saw a range of returns. US ‘mega-tech’ stocks drove market performance (S&P 500) over the final six months, benefiting Rest’s portfolios holding overseas shares, as excitement and optimism grew around the potential for artificial intelligence (AI). Australian shares also performed well over the year, driven by demand for resources.” Lill said.