Marketing mileage for winning fund managers

A POPULAR marketing tool for fund managers these days is to publicise the awards they have won.

This suits many fund managers because there are numerous awards waiting to be picked up.

The difficulty for investors is deciding which awards they should take notice of.

The major awards programs are sponsored by independent research houses Morningstar, Assirt and InvestorWeb.

As well as selecting overall winners, they have awards for multi-sector managers and for specialist sector managers, such as Australian shares, international shares, fixed income and property.

The big winner this year was clearly UBS Global Asset Management (see table above), which was judged fund manager of the year in both the Money Management – ASSIRT awards and the InvestorWeb Research Six Star awards (both announced last month).

UBS also won several sub-categories in both awards programs. However, UBS did not win anything in the Morningstar awards, announced in February.

Morningstar judged Perpetual Investments as fund manager of the year for the second year running.

Perpetual also featured in the ASSIRT and InvestorWeb awards, winning the Mortgage Funds category in both cases.

InvestorWeb says its awards focus more on qualitative assessment and less on either quantitative performance or issues of company strength or administration.

As far as possible they are intended to be forward looking rather than simply rewarding the best per-formers over the past 12 months.

ASSIRT also undertakes a forward-looking analysis. Its assessment process is built around one-year returns, a three-year risk adjusted return and the ASSIRT star rating.

The latest ASSIRT awards marked a departure from the ‘brand name’ managers.

ASSIRT’s head of research, John Parrish, attributed this to the increasing size of flagship funds, which can limit investment flexibility, and the departure of key staff from some funds.

A prominent example was Greg Perry, who triggered reviews of Colonial First State’s Australian equities funds earlier this year when he announced plans to retire.

Morningstar’s head of research, Daisy Chee, said Perpetual’s award was based on its performance relative to its peers, both from a return and risk basis, its business and investment disciplines, investment personnel and service levels.

In Australian shares, Perpetual has rewarded investors with consistently higher than average risk-adjusted returns, Morningstar said.

Mr Parrish said the growth of some newer fund managers may have been aided by the trend for investors to spread their money across more than one manager.

“As the market grows and invest-ors become more sophisticated, they are potentially looking at other managers to complement traditional managers,” he said.

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