Praemium adds ClearBridge Developed Markets Infrastructure Income Model Portfolio to SMA platform


Charles Hamieh

Leading investment platform provider Praemium has added ClearBridge Investments’ Developed Markets Infrastructure Income Model Portfolio to the Praemium Separately Managed Accounts (SMA) menu, providing greater access to the strategy.

Drawing on ClearBridge Investments’ strong global listed infrastructure capabilities, the Model Portfolio has been designed to produce attractive and stable returns by investing in an actively managed portfolio of infrastructure securities in developed markets.

The range of infrastructure sub-sectors in the portfolio includes gas, electricity and water utilities, toll roads, airports, rail and communications infrastructure throughout developed markets.

Top holdings in the portfolio include British multinational gas and electricity utility National Grid, US energy company Public Service Enterprise Group, Spanish electric utility Iberdrola, Scottish energy company SSE plc and toll road company Atlas Arteria.

As at 28 February 2022, the ClearBridge Developed Markets Infrastructure Income Model Portfolio produced a gross return of 21.0% since its inception**, compared with the 10.5% return for its benchmark, the OECD G7 Inflation Index + 5.5%.

Portfolio Manager Charles Hamieh says infrastructure is at the centre of several long-term thematics, including COVID recovery stimulus programs, decarbonisation and the transition to net-zero, transport efficiency and digital connectivity.

Hamieh says that in the current environment exposure to infrastructure assets can help protect against the impact of rising inflation.

“For a lot of infrastructure assets, inflation is a pass-through. If you look at toll road or airport operators, they will increase tariffs or tolls with inflation. If you look at a utility, there is either a  direct or indirect pass-through of inflation in its revenue model. Inflation is a positive in that sense.

“There will be increases at the cost line but the net cashflow position is neutral to positive,” Hamieh says.

Praemium’s Head of Investment Managers and Governance, Damian Cilmi says: “As we enter a higher inflation environment, having access to portfolios that offer the opportunity for diversification and some protection from inflation will be increasingly important for investors.  We’re pleased that Praemium is one of the first SMAs to offer advisers and their clients access to ClearBridge Investment’s infrastructure portfolio.“

Ryan Loehr, Partner at leading wealth advisory firm Emanual Whyborne has welcomed the addition of the ClearBridge model portfolio to Praemium.

“We recognised the likelihood of accelerating inflation post record levels of stimulus and the impact this would have on valuations. ClearBridge, offers listed infrastructure solutions that offer our  clients more stability than traditional equities.

“We view infrastructure as a preferred asset class and we regard ClearBridge as market leaders in this space. ClearBridge’s fund performance , particularly over the last year and during the market sell-off since mid-November is a testament to their experience and capabilities. Direct, convenient access to their model income portfolio via this leading platform is a positive for advisors and clients alike in our view,” Mr Loehr said.

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