AUSTRALIA - The Australian coal industry's superannuation fund has awarded a A$97.5m ($89bn) managed volatility mandate to Acadian Asset Management.
The A$5.2bn AUSCOAL Super said it expects the strategy to reduce risk without sacrificing returns. The strategy seeks to provide equity-like returns from global markets with significantly less risk than capitalization-weighted indices.
In April US manager Acadian was given a €120m ($158m) managed volatility mandate by Stichting Pensioenfonds Stork, the pension fund of Dutch industrial conglomerate, Stork B.V. The mandate was subsequently expanded to nearly €190m.
Acadian says it has noticed increasing interest in the strategy from institutional investors as they seek to maximise return in the context of total risk. It estimates it now has more than $1bn in managed volatility assets, twice the level of a year ago.
AUSCOAL chief executive officer Bruce Watson said: "We are attracted by the managed volatility concept because we expect it will reduce the risk within our portfolio without sacrificing returns. This should help us in our objective to deliver high value, low cost retirement products to our members."
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