Funds hold their ground

FOLLOWING an initial drop, managed fund assets more than held their ground during the December quarter in a sector dominated by the Commonwealth/ Colonial Group and National Australia/MLC.

Morningstar research shows that retail managed fund net assets rose $15.35 billion during the quarter and were $24.87 billion higher than the previous year, to reach $278.34 billion.

Retail superannuation masterfunds were the largest retail managed fund component type at $91 billion, while retail unit trusts held $58.98 billion under management.

Retail masterfund assets including trust, superannuation and pension masterfunds were up $10.24 billion over the quarter to reach approximately $148.44 billion. Masterfunds now account for 53.3 per cent of managed fund assets – up from 50.5 per cent one year ago.

The Commonwealth/Colonial and National Australia/MLC have increased their stake of total Australian retail managed fund assets to 31.1 per cent or $86.67 billion up from 30 per cent or $76.07 billion a year ago.

The increase in interest for masterfunds was pushed by National Australia/MLC with 64.2 per cent of its retail managed fund assets now in masterfunds.

In further developments, Morningstar also has downgraded Credit Suisse’s rating from five to four stars, indicating it is a “very good quality” fund manager in Morningstar’s opinion, compared with being considered an “excellent quality” manager status last year.

The ratings drop was driven by a fall in individual Credit Suisse managed fund ratings.

Eleven per cent of Credit Suisse’s funds under management rated by Morningstar were in five star funds at January 31 – less than half the 24 per cent of funds under management in five-star funds a year earlier.

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