In this release, 23 investment strategies are rated, five having been affirmed, two upgraded, and thirteen downgraded. Three strategies are newly rated.  

Among the downgrades are MLC’s Horizon and MasterKey capabilities. “Our reduced conviction is reflective of a number of factors including team change, lagging risk systems, mixed performance, and a general strengthening among competitor offerings,” said S&P fund analyst, Andrew Yap. 

The Blackrock Wholesale Balanced Fund has also been downgraded. “While it yet remains a sound offering among rated peers, we consider that the competitive advantage of this capability is diluted by the manager’s awareness of competitors when forming its strategic asset allocation,” said Mr Yap. 

“Select’s Defensive and Growth funds were upgraded on our heightened conviction in the Sydney-based investment team and our more favourable opinion on aspects of the product,” said Mr Yap. 

S&P notes that from early 2012, the BlackRock Balanced Fund and Select’s Defensive and Growth funds will each be moved to the multi-asset peer group (within the alternatives sector), which we consider is more representative of their investment mandates. This peer group comprises those capabilities that permit a more extensive use of alternatives, leverage, shorting, derivatives, commodities, and private equity. 

S&P will shortly release its comprehensive sector report on the multi-sector peer group, which will include our key findings and sector themes from the review.

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