Grace Su

ClearBridge Investments is pleased to announce that two of its recently launched global equity funds, the ClearBridge Global Value Improvers Fund and the ClearBridge Global Growth Fund, have each received inaugural ‘Recommended’ ratings from leading investment research house Lonsec.

These ratings follow the ‘Highly Recommended’ rating previously awarded by Zenith Investment Partners for ClearBridge’s suite of infrastructure funds, further reinforcing the firm’s multi-asset investment capabilities.

“We are delighted to see leading independent ratings agencies continue to recognise the strength and discipline of our investment teams across a broad range of strategies” said ClearBridge Managing Director and Head of APAC Business Development, Matt Bushby.

The ClearBridge Global Value Improvers Fund invests in 30-40 companies across developed and emerging markets that are considered by ClearBridge to be undervalued and those that are improving on certain ClearBridge ESG measures.

In its assessment, Lonsec highlighted the extensive experience of co-Portfolio Managers Grace Su and Jean Yu in implementing ‘value’ equity strategies, supported by a well-resourced and experienced research platform.

“The investment process is seen as differentiated and rigorous, with a forward-looking perspective on improvements linked to ESG factors. The manager’s ESG policy framework and disclosure are ahead of their peers. They are committed to integrating ESG within their investment process with a strong policy framework,” Lonsec noted in its report.

The ClearBridge Global Growth Fund targets above-market, “growth-like” returns with market levels of risk by investing in between 60-100 global companies diversified across a growth spectrum and trading below their intrinsic value, as assessed by the investment team.

Lonsec commended the depth and capability of the investment team, including co-Portfolio Managers Elisa Mazen, Michael Testorf, and Pawel Wroblewski, who have worked together as key decision-makers for over a decade.^[1]

“The capability and experience of the investment team is viewed as strong as it leverages extensive analyst resourcing and skilled co-PMs in delivering on the investment philosophy,” Lonsec said in its report.

“Lonsec has recognised the team’s skills and dedication to a disciplined investment process. Their long-standing collaboration and deep global research expertise are core to the strategy’s value proposition” Bushby said.

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Matt Bushby

Global investment manager ClearBridge Investments* (“ClearBridge”) has announced three actively managed Exchange Traded Funds (ETFs) on the Australian Securities Exchange (ASX), expanding investor access to its global infrastructure investment strategies. The new offerings are:

• ClearBridge Global Infrastructure Value Fund (Hedged) Active ETF (ASX: CIVH)
• ClearBridge Global Infrastructure Value Fund Active ETF (ASX: CUIV)
• ClearBridge Global Infrastructure Income Fund (Hedged) Active ETF (ASX: CIIH)

These ETFs are designed to deliver exposure to global infrastructure assets, with the aim of delivering stable income, inflation protection, and diversification which is particularly beneficial in a volatile market environment.

“With increasing market uncertainty, investors are seeking resilient income sources and differentiated equity exposures. Listed infrastructure stands out for its defensive characteristics, stable cash flows and long-term capital growth potential, particularly when compared with broader equities and fixed income,” ClearBridge Head of APAC Business Development, Matt Bushby, said.

The ClearBridge Global Infrastructure Value Fund Active ETFs typically invest in 30 to 60 listed securities across key global infrastructure sectors such as utilities, renewables, toll roads, airports and communications. The hedged (CIVH) and unhedged (CUIV) versions offer investors flexibility depending on currency preferences.

“Nearly half of the portfolio is in regulated utilities, a sector not typically impacted by international trade,” said Bushby. “Regulation and cost pass-through mechanisms may shelter these companies from global trade and tariff headwinds more effectively than other sectors.”

The ClearBridge Global Infrastructure Income Fund (Hedged) Active ETF (CIIH) focuses on income-oriented infrastructure investments, aiming to deliver consistent and reliable income.

“Infrastructure is a long-term investment in essential services, and its ability to provide consistent income can be particularly valuable during periods of market volatility,” Bushby added.

ClearBridge has a long-standing track record in active infrastructure investing, led by a dedicated team of specialists with a research-driven and disciplined investment approach. ClearBridge is part of the Franklin Templeton group of companies and this ETF launch follows the recent introduction of the Martin Currie Real Income Fund – Active ETF (ASX: R3AL) in Australia.

“ETFs continue to play a growing role in asset allocation and portfolio construction” said Bushby. “We remain committed to meeting the evolving needs of investors by providing simple, transparent and flexible access to the ClearBridge managed funds.”

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* “ClearBridge Investments” refers to ClearBridge Investments Limited (AFSL 307727) its subsidiary, and its Authorised Representative, ClearBridge Investments, LLC., a U.S. registered investment adviser, as well as part of Franklin Templeton Investments Corp. in Canada, who have operationally integrated their businesses under the global brand, ClearBridge Investments.

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Matt Bushby

ClearBridge Investments Limited, has been awarded the prestigious Zenith Fund Award in the infrastructure category for 2024.

The annual Zenith Fund Awards recognise outstanding performance and leadership across all asset classes in the funds management industry. These awards are considered a hallmark of excellence, setting a high standard in investment practices to benefit investors and drive innovation within the industry.

Each award is based on Zenith’s long-term assessment of key factors, including:

• strength of the organisation and investment team
• investment philosophy
• security valuation and selection process
• portfolio construction
• risk management practices
• fee structure.

“We are incredibly honoured to receive this prestigious award,” said Matt Bushby, Head of APAC Business Development at ClearBridge. “It’s a testament to our specialised investment team and their dedication to a disciplined investment process, which leverages the understanding that asset valuations ultimately reflect long-term cash flows. This award acknowledges our focus on infrastructure assets that aim to deliver more predictable and stable cash flows over time.”

“Global listed infrastructure continues to offer compelling opportunities. Infrastructure as an asset class provides resilience, with the advantages of liquidity and cost-efficiency that come from investing in listed markets. Our team in Australia is dedicated to identifying value within global infrastructure securities, such as publicly traded shares of companies in electricity, water, and transportation sectors. As active managers, we believe the flexibility in the listed infrastructure market enables us to respond to market dynamics and create meaningful value for our investors.”

ClearBridge originally launched their first global listed infrastructure strategy in 2006. The ClearBridge RARE Infrastructure Value Funds (Hedged & Unhedged) and ClearBridge RARE Infrastructure Income Funds (Hedged & Unhedged), continue to be recognised by earning ‘Highly Recommended’ ratings from Zenith Research in 2024.

Shane Hurst, Portfolio Manager at ClearBridge, said “Our approach to listed infrastructure is underpinned by deep research and active management. We look to invest in companies that benefit from long-term, stable cash flows, providing our investors with both capital appreciation and income. This award acknowledges our commitment to delivering superior investment outcomes for our clients.”

As ClearBridge continues to expand its investment capabilities, the firm remains committed to delivering high-quality, risk-adjusted returns for its investors worldwide.

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Grace Su

Global equity manager, ClearBridge Investments,^[1] has recently launched the ClearBridge Global Value Improvers Fund to Australian investors.

This Fund provides exposure to companies considered by ClearBridge to be undervalued and those that are improving on certain ClearBridge ESG measures,^[2] either through transforming their own products and services or enabling other entities to advance ESG objectives.

“We are focused on companies that we believe are committed to change. We think there’s a lot of opportunity in companies the market doesn’t classify as ESG friendly or which have not had their success in incremental ESG achievement recognised,” said ClearBridge Portfolio Manager, Grace Su.

“We are delighted to launch this Fund to Australian investors, offering them the opportunity to invest in a Strategy with the complementary combination of global value investing and a forward-looking approach to ESG improvement. We believe this approach provides advantages against value’s more cyclical nature and creates a disciplined framework for a concentrated, high-alpha generating portfolio,” said Matt Bushby, Head of APAC Business Development at ClearBridge Investments.

Su noted that the Strategy invests in 30 to 40 securities across developed and emerging markets and focuses on three main areas of improvers: Enablers, Reformers, and Promoters.

Enablers are companies that help their customers or industries, achieve ESG goals. Typically, these are companies whose products enable greater energy efficiency and lower natural resource use.

“Reformers are your former bad actors with a willingness and a plan to transition. For example, these could be energy companies that are on a path to adopting renewables, or traditional car companies transitioning from internal combustion engines to electric vehicles,” Su explained.

The third category, Promoters, include companies whose products or services have a direct impact on furthering the United Nations Sustainable Development Goals.

“Healthcare companies that improve outcomes, increase access to care and democratise healthcare are good examples of Promoters, as are financial companies that use their loan books to advance sustainable finance,” Su said.

“In recent months, political risk and policy uncertainty have become increasing overhangs on equity markets and we expect this to continue. Overall, periods of heightened volatility remind us of the importance of portfolio diversification and the benefit of having longer term investment themes, such as energy transition and governance reform, which are less tied to the economic cycle and thus lend stability during extreme market movements,” Su noted.

The ClearBridge Global Value Improvers Fund follows the launch of the ClearBridge Global Growth Fund, which was introduced to Australian investors earlier this year.

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Notes:
[1] “ClearBridge Investments” refers to ClearBridge Investments Limited (AFSL 307727) and its subsidiary, its Authorised Representative ClearBridge Investments, LLC. (as well as parts of Franklin Templeton Investments Corp. in Canada), who are operationally integrated under the global brand, ClearBridge Investments.
[2] The Fund may hold investments where ESG factors are not considered. Taking all factors relevant to the overall investment thesis into account, including non-ESG factors, a security with a relatively lower ESG rating may be acquired and retained, and, conversely, a security with a relatively higher ESG rating may be neither acquired nor retained, where ClearBridge believes this is consistent with the overall investment objective and strategy of the Fund.

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Matt Bushby

ClearBridge Investments^[1] proudly announces the launch of its inaugural global equity strategy tailored for Australian investors – the ClearBridge Global Growth Fund.

The ClearBridge Global Growth Strategy has a close to 12-year track record and an experienced team who manage over US$15.8billion in International and Global Growth Strategies.

The Strategy employs a disciplined, risk-aware approach aimed at delivering above-market, growth-like returns with market-level volatility. By identifying companies where the market has mispriced either the magnitude or duration of growth, the portfolio invests in 60 to 100 equities across a spectrum of growth: emerging, secular and structural, thereby allowing the Strategy to deliver for investors across various market environments.

Matt Bushby, Head of APAC Business Development at ClearBridge Investments said “The launch of this Fund marks the next stage of our growth strategy for Australian investors.

“Our business is transforming. Today, in addition to our award-winning listed infrastructure strategies, we are expanding our investment capabilities to offer Australian investors access to this very successful Global Growth Strategy.

“The ClearBridge Global Growth Fund is the first global equity fund ClearBridge has launched in Australia, and we are looking at potential opportunities to launch other global equity strategies in the future.

“We believe that increased volatility over the past few years as economies experienced higher inflation and the end of ultra-low interest rates, combined with the increased concentration risk in global equity indices, is driving financial advisers and investors to rethink their growth-equity allocations.  Increasingly investors are seeking consistency that can anchor their growth allocations through different market environments to compound over the longer term,” said Bushby.

The Strategy is managed by a team of experienced Portfolio Managers, including ClearBridge Investments’ Head of Global Growth, Elisa Mazen, who brings nearly 40 years’ experience in the funds management industry. Other Portfolio Managers managing this Strategy include Michael Testorf, CFA, and Pawel Wroblewski, CFA who have 37 years and 28 years of industry experience respectively.^[2]

Elisa Mazen commented on the success of the Strategy, attributing it to various factors, including the firms extensive proprietary research team of experienced analysts and detailed fundamental industry and company research. “We focus on investment thesis, valuation, risk assessment, as well as ESG factors^[3], to select high-quality businesses, with sustainable growth characteristics but which are trading at a discount. We then diversify the portfolio along a spectrum of growth which allows us to perform in a variety of market regimes.”

Portfolio Manager, Michael Testorf, CFA, emphasised the firm’s commitment to ESG principles stating “As part of our fundamental research, we engage with our portfolio companies regularly on ESG issues relevant to their business model and profitability^[4.

As at 31 March 2024, the ClearBridge Global Growth Strategy has produced an average annual gross return of 17.5% since its inception^[5], outperforming its benchmark, the MSCI AC World (Net) Index by 3.0%.

The top five holdings in the Strategy as at 31 March 2024 include:

• Microsoft Corp
• Amazon.com Inc
• Eli Lilly and Company
• Apple Inc
• Nvidia

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Notes:
[1] “ClearBridge Investments” refers to ClearBridge Investments Limited (AFSL 307727) and its subsidiaries, its Authorised Representative ClearBridge Investments, LLC. (as well as parts of Franklin Templeton Investments Corp. in Canada), who are operationally integrated under the global brand, ClearBridge Investments.
[2] The Portfolio Managers are employed by ClearBridge Investments, LLC. an Authorised Representative of ClearBridge Investments Limited
[3] The Fund may hold investments where ESG factors are not considered, including cash, cash equivalents, exchange-traded funds and certain types of derivatives. Taking all factors relevant to the overall investment thesis into account, including non-ESG factors, a security with a relatively lower ESG rating may be acquired and retained, and, conversely, a security with a relatively higher ESG rating may be neither acquired nor retained, where ClearBridge Investments believes this is consistent with the overall investment objective and strategy of the Fund.
[4] We acknowledge that there may be limitations to the degree of influence that ClearBridge Investments may reasonably have.
[5] Performance inception date for the ClearBridge Global Growth Strategy is 30 June 2012. Past performance is not a reliable indicator for future performance. Please note that a comparison between the ClearBridge Global Growth Strategy and the ClearBridge Global Growth Fund may not always be appropriate due to differences between the investment vehicles, including differences in fees, how these vehicles are traded, consideration of ta impacts and other differences which may impact the outcome.

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Matt Bushby

ClearBridge Investments’ ClearBridge RARE Infrastructure Income Fund – Hedged (the Fund) saw record inflows in the past financial year of $512 million with global listed infrastructure as an asset class totalling inflows of $1 billion, according to Rainmaker Information’s latest Wholesale Managed Funds Net Flow Report.

“In a financial year that saw overall estimated net flows of negative $29 billion across all asset classes, the ClearBridge RARE Infrastructure Income Fund – Hedged inflows in excess of half a billion are an exceptional achievement,” Matt Bushby, Managing Director and Head of Infrastructure Business Development at ClearBridge Investments in Australia, said.

The Rainmaker Wholesale Managed Funds Net Flow Report provides market intelligence on the use of Wholesale Managed funds and shows the growth or decline in the use of Wholesale Managed Funds in certain asset classes, individual managers and investment styles.

“Over the past 12 months, during which rates and inflation remained high and continued to cause volatility in markets, the high flows into the asset class and Fund show that investors understand how infrastructure can provide inflation protection and diversification to portfolios,” Bushby said.

“The Fund’s objective has always been to provide investors with regular and stable income from a portfolio of global infrastructure securities while hedging the Fund’s currency exposure back to AUD.”

The ClearBridge RARE Infrastructure Income Fund – Hedged had the eleventh largest inflows of any fund in the Rainmaker report and the highest inflows of any of the 23 infrastructure funds analysed.

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The RARE Infrastructure Income Fund targets a portfolio yield of 5%pa (net of withholding tax) and a real total return of OECD G7 inflation+5.5%pa across an economic cycle. As at 31 March 2017, the Fund has rewarded Australian based clients 20.3% over one year and 13.2% over five years. The Fund currently has a forward dividend yield of 5.5% and expected DPS growth of 6.6% pa over the next five years.

“The Fund offers investors both income and real diversification from other asset classes”, commented Portfolio Manager Shane Hurst. “In the current environment, it can be tough for investors to generate an income with cash at record lows and uncertainty around the direction of traditional income allocations. Infrastructure companies’ earnings are typically underpinned by regulatory frameworks or long-term contractual agreements, making them ideally placed to provide investors with a source of attractive and stable dividend yields with some capital growth over time. The RARE Infrastructure Income Fund does not use derivatives to manufacture income and invests only in listed infrastructure securities from around the globe. RARE’s benchmark unaware approach to portfolio construction allows the investment committee the flexibility to manage the Fund through ever-changing macro environments.”

“Overseas demand for RARE’s Income Strategy has been strong,” said Matt Bushby, RARE’s Head of Global Distribution. “In particular, the demand from RARE’s UK based clients seeking a globally diverse, defensive, income orientated equity product has already attracted over AUD460million since launching in that market only nine months ago. We are seeing a growing level of interest from our Australian clients and believe it reflects the evolution of the asset class. Five years ago, financial advisers started to include global listed infrastructure as a core component of their client portfolios. Now those charged with portfolio construction are taking a more granular approach seeking to tailor specific investment outcomes to different types of infrastructure exposure which meet the needs of different types of investors.”

RARE’s two other global listed infrastructure strategies; the RARE Infrastructure Value Fund and the RARE Emerging Markets Fund have also been awarded a ‘Recommended’ rating from Lonsec Research.

The RARE Infrastructure Value Fund seeks to provide investors with regular and stable income, plus capital growth with a specific focus on minimising the volatility of returns. The Fund is available as a hedged or unhedged vehicle, and as at 31 March 2017, the hedged and unhedged product has rewarded Australian based clients 14.2% and 10.9% over one year and 11.9% pa and 13.6% pa over five years respectively.

Investing solely in Emerging Market Infrastructure, the RARE Emerging Markets Fund also seeks to provide investors with regular and stable income, plus capital growth with a specific focus on minimising the volatility of returns. The Fund delivered an exceptional Q1 result of 9.2% significantly outperforming the MSCI Emerging Markets Index and Emerging Market equity funds. Over a five-year period, the Fund has rewarded Australian based clients with 12.1% pa annualised return outperforming all of Emerging Market equity funds.

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