Schroders launch new fund to tackle YFYS benchmark

Yasmine Raso

Senior Journalist

10 March 2022

Global asset management, Schroders, has announced the launch of its new Schroder Global Active Allocation Fund for institutional investors in Australia, managing directly to the Your Future Your Super (YFYS) alternative asset benchmark.

Sam Hallinan, CEO of Schroders, said the fund was created specifically to meet the need of a government’s super fund for a multi-asset strategy managing to the YFYS benchmark that aims to outperform within a tracking error limit.

“The Schroder Global Active Allocation Fund demonstrates our ability to design solutions that meet clients’ needs,” he said.

“We bring our considerable experience to bear in partnering with the fund on this investment opportunity.”

The fund aims to outperform the Federal Government’s YFYS alternative assets benchmark by one to two per cent per year, before fees, over rolling three-year periods with strict tracking error limits.

The benchmark is an equally weighted combination of the MSCI All Country World, Ex-Australia, Equities Index and the Bloomberg Barclays Global Aggregate Bond Index to match the YFYS benchmark’s risk profile for alternative assets.

The actively managed fund will be run by Schroders’ Australian Multi-Asset team, with Angus Sippe as lead fund manager.

Sippe said the fund is suitable for APRA-regulated funds that invest in strategies subject to the YFYS benchmark and aims to provide a solution for funds in the liquid alternatives space.

“The fund takes a forward-looking approach to asset allocation and risk management, allowing for tactical positioning around the YFYS alternatives benchmark (50% global equities/50% global bonds),” he said.

“However, the fund’s investment universe is broader and is not constrained by the constituents of the YFYS alternatives benchmark. It has a broad universe of investments including traditional assets as well as exposure to alternatives, active currency, and derivative strategies.”