With all eyes turning to Brazil for the kickoff of the 20th Fifa World Cup this week, AsianInvestor has moved to select its own fantasy fund manager football XI.
Just three teams from this region have qualified for the global showdown – Japan, South Korea and Australia; pedants will also point to Iran – so we wanted to put forward a team of the best performing fund managers operating in Asia Pacific today. Perhaps we can start a new trend: fantasy fund manager football.
We selected our team of 11 to reflect the realities of a football team, with a goalkeeper, four defenders, four midfielders and two strikers. To see the team in full, click here.
We set an adjudication period of four years for all strategies from April 1, 2010 to March 31, 2014 – in keeping with the four-year world cup cycle.
We only considered strategies with a four-year track record, and weighted managers based on their experience as well as performance. All returns are annualised, gross of fees and in US dollars.
Our performance data was provided independently by Mercer, Morningstar and eVestment. We would like to thank them for their support.
We then added a qualitative overlay to build a team that we felt struck the right balance between defence and attack – just like a football manager.
For goalkeeper we sought an ultra-safe strategy with very little active risk.
In defence we picked three diversified fixed income strategies, one global and two Asian (hard and local currency). To complete our back four we added a Hong Kong dollar bond strategy for the security of the US dollar peg, which we believe is safe for the next four years!
In midfield we featured a dynamic multi-asset strategy investing in both equities and bonds, to link our defence to midfield and attack. To complete our midfield quartet we added a diversified equity fund, a single-country equity fund and an Asian small-cap strategy.
In attack we emphasised absolute performance over risk-adjusted returns, and ended up with a micro-cap strategy from Australia and a Japan-focused hedge fund.
AsianInvestor’s select XI is published in full in our June magazine issue, which became available today online. Let us know what you think of our project, and perhaps send us your own team/player suggestions, by writing to us at [email protected].
To kick off, here is AsianInvestor’s goalkeeper. We will reveal our team selection during the course of the week or so. Enjoy the football fever!
BlackRock Institutional liquidity fund
Size matters for a goalkeeper, and they don’t come bigger than BlackRock. This fund invests in cash and AUD money-market securities. Most Asian investors are US dollar based, but we wanted an Asia-Pacific developed market cash asset class and Australia has the most compelling returns with similar low volatility as other developed markets. We did convert returns to US dollars. The fund has an annualised return of 4.9% over the past four years, with 0.6% excess return and tracking error of 0.1%. That gives it an information ratio of 7, a clear margin ahead of others in this category. By any standards Australia is a safe bet with its AAA credit rating. Whether you look at budget balance or public debt to GDP, it’s exceedingly strong. Cameron Garlick is manager for BlackRock’s Aussie dollar bond portfolios. Garlick’s services date back to 2001, encompassing his time with Merrill Lynch Investment Managers, which merged with BlackRock in 2006. At MLIM Garlick was assistant portfolio manager responsible for trade modeling and execution. Experienced with an excellent track record, Garlick is a safe pair of hands.