When substance defeats hype
The latest FE Crown Ratings confirm that substance always defeats hype.
The quant ratings have revealed the funds management groups with the most Five Crown ratings to be Macquarie (eight), Perpetual (seven) Morningstar (six) and AMP Capital, Challenger and IOOF each with five funds.
Importantly, four of the six funds rated as having the most Crown Ratings in November, last year, continued to hold that status, with Macquarie adding two further funds while Perpetual held ground with eight funds.
Challenger and AMP Capital were added to the list at the expense of Fiducian and Investors Mutual.
While the investment teams on all the top-rated funds are highly regarded, importantly none of the higher profile fund managers found themselves ticking the boxes for exceptional consistency.
Looking at the outcome, industry veteran Stephen van Eyk said it was consistent with past experience and proof that funds management groups who focused on funds management as a repeatable process would succeed.
van Eyk noted that Perpetual had historically proven its consistency and that during his time at van Eyk Research it was a company which had recorded one of the longest-ever runs of being ‘A-rated’.
“Most managers go ‘off’ for one reason or another, people move or whatever, but Perpetual has mastered making what they do a repeatable thing,” he said.
FE head of Data for Australia and New Zealand, Stuart Alsop agreed with van Eyk that it appeared to be those managers who maintained their focus who performed most consistently in the quant-based Crown Ratings.
He agreed that groups that not only focused on process but also on building teams and succession plans also tended to exhibit the most consistency – something evidenced by Macquarie which appeared to have not been unduly harmed by the exit of some members of its Macquarie Small Companies Fund.
Recommended for you
Clime Investment Management has faced shareholder backlash around “unsatisfactory” financial results and is enacting cost reductions to return the business to profitability by Q1 2025.
Amid a growing appetite for alternatives, investment executives have shared questions advisers should consider when selecting a private markets product compared to their listed counterparts.
Chief executive Maria Lykouras is set to exit JBWere as the bank confirms it is “evolving” its operations for high-net-worth clients.
Bennelong Funds Management chief executive John Burke has told Money Management that the firm is seeking to invest in boutiques in two specific asset classes as it identifies gaps in its product range.
