Giant Wealth Fund Seeks Managers to Beat Frothy Market
- Future Fund CIO says skilled managers harder to come by
- Firm is lowering investment costs in bid to improve returns
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Australia’s sovereign wealth fund has been saying for months that with markets as elevated as they are now, generating gains is only going to get harder. So is finding the right asset managers.
For the A$212 billion ($142 billion) Future Fund, picking investors is a higher-stakes decision given an outlook that implies market returns won’t be enough to meet its target. The problem: in public markets, manager skills are concentrating, meaning there are fewer funds beating their indexes after fees, Chief Investment Officer Raphael Arndt said. He also noted that the cash flooding into other asset classes, such as private equity, is taking up capacity with experienced hands.