K2 AM plans expansion of RE strategy

8 December 2021
| By Laura Dew |
image
image
expand image

K2 Asset Management expects to launch exchange traded funds (ETFs) with a “number of additional managers” in the future, as part of a responsible entity (RE) strategy for the business.

In an address to shareholders issued to the Australian Securities Exchange (ASX), chair Campbell Neal, said the firm ran a service for REs which assisted external managers to launch and run exchange traded funds (ETFs).

This allowed the firm to capitalise on its proprietary skill base that it used on its own funds to be used with other fund managers. There were several additional managers that it expected to launch ETFs or transition funds in the near future, he said.

Neal said: “Continuing to grow the RE offering for external managers is an area we are concentrating on and are confident will increase in the future. K2 has the processes, IT, capabilities and long-term experiences with the financial backing to fulfill this role and we believe this is an area where long-term sustainability will be achieved.

“The majority of partnering discussions we are having with external managers also involve the launching of an associated ETF. That offering is unique in that it provides the manager with a one-step shop including ASX admission, iNAV calculation, market making and market disclosure.”

In its FY21 result, the firm said performance fees from its five funds increased from $709,857 to $2.4 million but management fees decreased from $1.9 million to $1.4 million. Total revenue was $4.46 million.

Net profit after tax was $215,762 while funds under management and advice were $1.4 billion. This had been helped by the firm’s re-engagement with asset consultants which opened distribution channels and opportunities.

“One of the key stepping stones for the past 12 months was the re-engagement of asset consultants and specifically the K2 Australian Small Cap fund receiving an investment rating from Lonsec,” Neal said.

“These ratings are the key to growth of most retail funds, they open distribution channels and opportunities.

“The K2 Australian Small Cap fund has not only delivered strong investor returns but its ETF structure, certainly points to increased FUM in the future. We need to continue to engage these consultants and work towards greater presence on platforms and with financial planners.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

GG

So shareholders lose a dividend plus have seen the erosion of value. Qantas decides to clawback remuneration from Alan ...

2 months 1 week ago
Denise Baker

This is why I left my last position. There was no interest in giving the client quality time, it was all about bumping ...

2 months 1 week ago
gonski

So the Hayne Royal Commission has left us with this. What a sad day for the financial planning industry. Clearly most ...

2 months 1 week ago

A Sydney-based financial adviser has been banned from providing financial services in the interest of consumer protection after failing to act on conduct concerns. ...

3 weeks 3 days ago

ASIC has cancelled the AFSL of a $250 million Sydney fund manager, one of two AFSL cancellations announced by the corporate regulator....

3 weeks 1 day ago

Having divested its advice business in August, AMP is undergoing restructuring in at least four other departments amid a cost simplification program....

2 weeks 5 days ago