Acadian Asset Management (Australia) announces staff appointments
21 September 2005
Acadian Asset Management (Australia) Limited (‘Acadian Australia’) is a quantitative investment management business jointly owned by Colonial First State and Acadian Asset Management Inc of Boston, Massachusetts. Acadian Australia announced today the appointment of its Chief Executive Officer, Chairman and Head of Portfolio Construction.
The Chief Executive Officer will be Chris Clayton, currently Head of National Accounts and Research at Colonial First State. Chris has had outstanding success in representing Colonial First State’s products to major accounts and asset consultants, and has managed research relationships for many years. He is ideally placed to deliver Acadian’s Australian equity products to the local market.
The Chairman will be Bruce Bonyhady. Bruce has held many senior positions in the funds management industry, including Managing Director at ANZ Investments and Executive Vice President and Head of International at BT Funds Management. He was previously Managing Director of National Mutual Funds Management (Europe), and a Director of Syntec Economic Services. Bruce’s other roles include Chairman of ANZ Executors and Trustee Company and Chairman of the Investment Committee at Deutsche Wholesale Property Fund.
Joining the new company as Head of Portfolio Construction from Acadian Asset Management in the United States will be Jim Klapman. Jim has been with Acadian Asset Management for almost 10 years, including as Vice President Portfolio Construction and Trading and Vice President Client Service and Marketing. Jim brings with him an intimate knowledge of the Acadian processes and the intellectual property which will be used by the Australian business.
Additional appointments in research and administrative roles are expected shortly.
Acadian Australia is expected to launch its Australian equity services for institutional investors in November 2005, and the funds managed by Acadian Australia are expected to be included in Colonial First State’s FirstChoice* retail and wholesale offerings in February 2006.
Stuart Grimshaw, Group Executive, Wealth Management, said, “We expect the alliance between Acadian and Colonial First State to become a major force in Australian quantitative funds management. We are delighted that executives of the calibre and experience of Chris, Bruce and Jim will be guiding the business and managing invested funds. Acadian has an outstanding long-term reputation in global equities, and the new business will bring these skills to the Australian equity market.”
Ronald Frashure, Acadian’s President and Co-Chief Investment Officer, said, “We already know the Australian market well, and the new company managed by these experienced and talented executives will deliver our technology to the Australia equity market.”
[Attached: Background information on Acadian and its investment approach]
* The Acadian funds are expected to be added to the Colonial First State –FirstChoice range of products from February 2006. Colonial First State – FirstChoice Investments, FirstChoice Personal Super, FirstChoice Employer Super, FirstChoice Pension, FirstChoice Wholesale Investments, FirstChoice Wholesale Personal Super and FirstChoice Wholesale Pension are issued by Colonial First State Investments Limited ABN 98 002 348 352 AFS Licence Number 232468. Product Disclosure Statements (PDSs) describing the features and fees for the new options will be available at colonialfirststate.com.au or by calling us on 1300 360 645 from late February 2006. This is not financial product advice and does not take into account any person’s individual needs, financial circumstances or objectives. You should read the relevant PDS and consider talking with a financial adviser before deciding whether to acquire or continue to hold options in FirstChoice.
BACKGROUND ON ACADIAN
Acadian Asset Management is a Boston and Singapore-based investment management firm specialising in active global equity strategies. It invests around US$25 billion on behalf of major pension funds, endowments, foundations, governments and others.
Acadian was founded in 1977 and it designed, developed and implemented an international index-matching strategy and an active country selection strategy for the State Street Bank and Trust Company. In 1987, Acadian began to manage institutional assets directly. Since then the firm has served some of the world’s largest and most sophisticated investors.
In 1992, Acadian became an affiliate of United Asset Management (UAM). In October 2000, London-based Old Mutual PLC, a publicly traded international financial services group, in turn acquired UAM. Acadian opened its Singapore office in 1999 to better serve clients, especially those in the Asia-Pacific region.
Acadian’s investment philosophy centres on the belief that equity markets are inefficient and many stocks are mispriced relative to their long-term prospects. Stocks should be evaluated not only by how cheap they appear on simplistic value measures (such as price/book or price/earnings), but many additional factors should be used to target attractively valued companies including positive earnings and price characteristics.
There is no “one size fits all” process that works in all markets; the most effective stock selection factors are not the same in all countries. Successful investing requires a sophisticated process that is tailored to each market’s and industry sector’s unique character.
Acadian calls its approach Enhanced Value Investing. Acadian employs a disciplined, objective process using multi-factor frameworks, customized market-by-market. The goal in stock appraisal is to identify companies that have strong prospects for outperformance. Sophisticated portfolio construction tools are employed to create portfolios that meet desired objectives for risk, capitalization profile, stock or country restrictions, and value-add.
A quantitatively-based approach is essential to effective fundamental evaluation of the many thousands of diverse opportunities available to the global equity investor. Acadian employs advanced analytical models for active stock selection as well as country and currency valuation, which draw on a proprietary database covering over 20,000 securities in more than 40 equity markets worldwide.
The joint venture will bring Acadian Inc’s intellectual property and Colonial First State’s investment administration and retail marketing to the Australian equity quantitative management industry.