Aust Unity dives in with Platypus
Australian Unity Investments has formed a joint venture with boutique manager Platypus Asset Management to offer Australian retail equity products.
Platypus had previously operated in the wholesale market and chief investment officer Donald Williams admitted it was hard breaking into the retail market.
“We have found that gaining traction in the retail market is difficult, expensive and time-consuming, so accessing Australian Unity’s experience and expertise in this area is a sensible move for us,” he said.
Under the joint venture, Australian Unity is developing an actively managed Australian equities fund for both retail and platform markets. The platform version will have a minimum investment of $25,000 and will also be aimed at the self-managed super fund market.
Head of Australian Unity investments David Bryant would not be drawn as to when the new fund would be launched, but confirmed the fund manager’s existing Australian equity products will remain. This includes the agreements with outsourced managers looking after these funds.
The new joint venture is an equal partnership, with Platypus handling the investment strategy and Australian Unity looking after distribution, administration and compliance.
All Platypus staff will remain to work on the joint venture, although the boutique’s hedge fund business will remain outside the relationship with Australian Unity and will be part of a new company called Platypus Holdings. This company will continue to be owned by Donald Williams and fellow director Nicholas Wright.
Bryant said Australian Unity had been looking for 12 months for an Australian equities manager to compliment its micro-cap manager Acorn.
“Our needs were to find the right people that had the investment capacity,” he said.
“Platypus was small and there was the opportunity to develop with them.
Currently, Platypus has $50 million in funds under management and Bryant says the capacity of the joint venture is up to $2 billion before problems achieving levels of stock diversification would appear.
“As the market for the joint venture grows we will provide capacity to match that growth, and our testing shows $2 billion is the maximum capacity for the equities fund,” he says.
Recommended for you
Sequoia Financial Group has declined by five financial advisers in the past week, four of whom have opened up a new AFSL, according to Wealth Data.
Insignia Financial chief executive Scott Hartley has detailed whether the firm will be selecting an exclusive bidder for the second phase of due diligence as it awaits revised bids from three private equity players.
Insignia Financial has reported a statutory net loss after tax of $17 million in its first half results, although the firm has noted cost optimisation means this is an improvement from a $50 million loss last year.
With alternative funds being described as “impossible” for fund managers to target towards advisers without the support of BDMs for education, Money Management explores the evolving nature of the distribution role.
