Standard & Poor’s Fund Services has announced the first release of ratings from its 2011–2012 global equities sector review today. Funds rated in the growth/GARP, value, unconstrained equity, and indexed peer groups are included in this release.
Four managers are rated four stars in this release, and are considered to offer the strongest capabilities in the sector. The managers are Aberdeen Asset Management, Altrinsic Global Advisors, Vanguard Funds, and AllianceBernstein (distributed through AXA/AMP).
- The Aberdeen global equity team is supported by a large global network of regional equity analysts who help distil the investment universe into a manageable number of potential investment opportunities. S&P believes that there is a mix of experience and depth of coverage across the regions. The manager implements a pragmatic and logical investment philosophy and process resulting in a benchmark-unaware, relatively high-conviction portfolio of between 40–60 stocks.
- Altrinsic Global Advisors is an all-cap, value-focused global equities manager that is majority owned by its employees, with nabInvest holding a minority stake. Altrinsic’s less-constrained style of investing has enabled it to navigate various market environments, while still delivering downside protection for investors. At the same time, the manager’s go-anywhere investment approach hasn’t insulated investors from the periods less conducive to value-style managers in general.
- Vanguard’s index-investment approach seeks to deliver investment returns that closely match the index. For its global equities large-cap strategy, Vanguard adopts a full or close-to-full-index replication approach. It continues to implement this investment approach in a disciplined and risk-controlled way, successfully adding incremental value through the efficient management of cash flows and index changes.
- AllianceBernstein’s value equities team, the underlying manager of the AXA Global Equity Value Fund, displays an unwavering commitment to the “value” investment style that results in a disciplined “true-to-label” value offering. Despite the staff changes over recent years, its investment team still remains one of the best resourced in the industry.
“Many global equity managers are concerned about the market recovery running out of steam and have steered their funds toward defensive blue-chip companies, many with a large allocation to Asian markets,” said S&P fund analyst, Justine Gorman.
There was a high degree of disparity in performance among major share markets in 2011, with all major equity markets losing value. Emerging markets experienced larger losses than most developed markets over the course of the year, which was heavily influenced by commodity price trends and the outlook for China. With the Australian dollar opening and closing the year at around the U.S. 102 cents level, there was minimal difference in returns between hedged and unhedged MSCI World Indices.