Unlisted assets drag down industry funds
Retail master trusts have overtaken industry funds on investment returns and are likely to move further ahead on the back of October investment returns.
That is the bottom line of the latest analysis from research house Chant West, which has used its latest quarterly bulletin to point to the fact that master trusts overtook retail funds to the tune of 1.5 per cent in September and may move as much as 4 per cent in October.
Further, the Chant West analysis suggested that the retail master trusts would continue to outperform over the next six to 12 months because the performance of unlisted assets might continue to trend down while listed markets continue to trend up.
Referring to the high exposure of industry funds to unlisted assets, the Chant West analysis said it believed the downward revaluation of unlisted assets still had a little further to go before possibly bottoming in the next six months.
“So this will be a drag on industry funds’ performance for some months yet,” it said.
However, the Chant West analysis said industry funds might regain an advantage because of an investment style that is less constrained by liquidity concerns.
AUTHOR
Mike Taylor
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