NZ Super: Defining long-term success for a SWF investor

Matt Whineray, Chief Executive Officer, NZ Super Fund

As an industry we need to think long term and holistically about performance, to achieve better outcomes for our ultimate beneficiaries.

The challenge is to ensure that the individual decisions that make up our financial system are made not just with short term financial success in mind, but with our ultimate beneficiaries’ long-term interests at heart. With that in mind, the Fund underwent a portfolio review in 2020 from which a number of important decisions were reached.

SWFs: The powerful venture capitalists in the "new economy"

Winston Ma, CFA & Esq., Adjunct Professor, NYU School of Law, Former Managing Director, China Investment Corporation, Author of China's Mobile Economy, The Hunt for Unicorns and The Digital War

SWFs are the frontier investors in today’s capital markets. Collectively, they are estimated to have US$30 trillion in assets under management and as a result, wield enormous power in the financial world.

With so many exciting developments – and global tensions – in play at the moment which sit at the intersection of sovereign investment funds, cross-border tech investing and digital economy regulations, Winston finds himself back in the midst of capital market for tech investing and making sense of the rapid changes taking place.

Drivers of commercial real estate markets

Tony Crabb, National director, Research, Cushman and Wakefield

Government policy, demographics, technology and the environment, are but a few of the many drivers impacting the prospects for returns in commercial property. In this interview we explore these and some of the other key trends impacting returns, the key trends unfolding in markets now and where investors can look to capitalise on opportunities in the coming years.

Developing a long-term approach to investing for the new normal

COVID-19 has possibly triggered a paradigm shift. Seemingly, it will be very difficult to go back to doing what we used to do, in the way we used to do it. The focus for me in my role primarily centres around assessing the impact of COVID-19 on both investments and business strategy and thinking about how to develop a longer-term approach that is robust to whatever the new normal will look like as we emerge from the crisis.

Assessing risks and opportunities in an uncertain investment landscape

Investors should be wary of paying a premium for investment strategies that worked well over the past 10 years.

Rather, investors should be focusing on themes that will benefit from the combination of re-activated fiscal policy, the preparedness of central bankers to accommodate ballooning budget deficits as a means of trying to push inflation higher, and the growing market power of ‘Big Tech’.

Creating resilient portfolios for the post COVID-19 world

A razor-sharp focus on resilience marks a back-to-basics approach to investing. Market prices will increasingly reconnect with their fundamentals as key central banks lose potency in artificially boosting asset values and dampening volatility. Their debt monetisation policies – including yield curve control – will erode their independence and see the return of inflation.

Opportunities in China: Perspectives from a local investor

With the heavy focus of Australian institutional investors on exploring opportunities in China, we spoke with Dr Henry Zhang, Chief Investment Officer of a China based hedge fund, High Hope Wisdom Capital and discussed the key dynamics playing out in China that make it an attractive destination for foreign capital and how best to access the opportunity set.

APRA’s superannuation performance benchmark elevates derivative and overlay efficiency

Performance matters. Funds not seeking to improve their performance metrics may be forced to close to new membership under APRA’s Performance Benchmarking.

The impacts of COVID-19 are likely to amplify growth in responsible investing

There is evidence of growing consumer interest and care in how and where their money is invested. A ‘financial returns at all costs’ approach no longer stands up to scrutiny as an investment thesis.

Valuation extremes to return to cyclical norms

The biggest challenge capital allocators currently face is the impact central bank policies are having on investment markets. The implementation of significant QE policies and reduction in interest rates has had a major impact on investment fundamentals, but valuations will undoubtedly return to their cyclical norms.

Embracing alternative strategies

The evolution of Statewide Super’s asset allocation over the last five years has seen an overall reduction in bonds and equities, with an uptake in alternative strategies.

Institutional investors need a willingness to explore global opportunities

Australian institutional investors need to be aware of, and accept that, a large proportion of the best investment ideas are going to be domiciled in offshore markets moving forward.

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