Michael Lovett

Current market gyrations are generating market inefficiencies that create opportunities for excess investment returns, particularly in the small caps market, says Michael Lovett, Chief Executive Officer of Bell Asset Management.

“The uncertainty created by geopolitical tensions and the AI narrative is resulting in heightened volatility and price dislocations. This creates opportunities for investors with a patient mindset and strong risk management,” he says.

“In the Australian small cap market, the opportunities are looking particularly attractive. For instance, forecast earnings growth in the Small Ords index for the next two years is three times that of the ASX 100.”

With the first Australian small companies fund from Bell Asset Management close to launching, Mr Lovett says many other small cap managers are close to capacity so it is a fortuitous time to launch a new fund that can take full advantage of the current opportunities.

“The timing for establishing our Australian small companies strategy is ideal and, with our new team now on board, we are well advanced in finalising our new fund which will be launched in the next month,” he says.

The Australian Small Companies strategy complements Bell’s global equities offering, which has applied a quality-first approach to global equities since 2003. While each strategy operates with its own distinct philosophy, both reflect Bell’s commitment to rigorous, bottom-up research and disciplined stock selection and extend the firm’s coverage into the domestic small-cap market.

Portfolio manager Tim Johnston says the team will focus on undervalued but quality stocks which they believe will generate superior returns for investors over the long term.

“The volatility we’re seeing right now is creating some of the most compelling entry points in quality small-cap businesses that we’ve seen in years and we’re excited to be launching at exactly this moment. For long-term investors, that kind of dislocation is an opportunity, not a risk.

“Small caps are cheap at the moment, with the Small Ordinaries currently trading at a 18 per cent discount to its 10-year average. However the outlook for small caps is particularly strong, with forecast earnings growth for the next two years expected to be three times that of the ASX100. We firmly believe this creates outstanding opportunities for small caps investors, especially when compared to the market performance of the past few years,” Johnston says.

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Andrew Stewart

Bell Asset Management is pleased to announce the appointment of Andrew Stewart as Head of Retail Sales, effective 19 May 2025. In this newly created role, Andrew will report to Robert Sullivan (Managing Director, Distribution & Strategy) andwork closely with Xanthe Virtue (Head of Wholesale & Platforms), to strengthen the firm’s adviser service model and enhance its distribution reach.

Andrew brings more than 25 years of experience in financial services, most recently Head of Distribution at Allianz Retire+. He has held executive roles across some of Australia’s most respected firms including AUSIEX, Commonwealth Bank, Colonial First State and Asgard. His deep expertise in retail distribution and adviser engagement will be instrumental as Bell sharpens its focus on delivering market-leading client outcomes.

“Andrew is a highly respected figure in the industry, with a long track record of building strong adviser relationships,” said Michael Lovett, CEO of Bell Asset Management. “His appointment is a strategic move that supports our goal of delivering a best-in-class adviser experience, and reflects our long-term commitment to the adviser market.”

This appointment forms part of a broader strategy to bolster Bell’s internal capabilities and drive growth across its global equities platform—particularly its high-conviction Small and Mid-Cap offering, which continues to gain momentum with advisers and clients alike.

Recent leadership changes, including the appointment of Andrew Gowen as Portfolio Manager and Director of Research, and Lucinda Hill as Executive General Manager, Product and Operations, further underline Bell’s commitment to innovation, agility, and delivering excellence in investment management.

Bell remains laser-focused on delivering superior outcomes for clients and expanding its presence in the adviser market.

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Lucinda Hill

Bell Asset Management (BAM) is pleased to announce the appointment of Lucinda Hill as Executive General Manager, Product and Operations. This newly created role is designed to bolster BAM’s strategic growth, bringing a sharper operational focus to both its Australian and international markets.

Lucinda will assume her position in January 2025, bringing with her a wealth of experience from Paradice Investment Management, where she was Chief Operating Officer for their US business.

Lucinda’s extensive expertise in product management and operational strategy will play a pivotal role in BAM’s plans to capitalise on recent positive buy ratings from leading US-based asset consultants. While BAM is strengthening its global footprint with a focus on growth in the US, the firm remains firmly committed to its Australian client base, ensuring that this local market continues to receive the highest level of service and innovation.

“We are very pleased to welcome Lucinda to BAM,” said Michael Lovett, CEO of Bell Asset Management. “Her deep understanding of both the Australian and US markets, along with her strong product development focus, aligns perfectly with our vision. Her operational insight will be instrumental as we pursue our global ambitions while keeping our Australian clients front and centre.”

Following Lovett’s recent appointment as CEO, Lucinda’s addition underscores BAM’s commitment to balanced growth across both Australian and international markets. “We’re intensifying our efforts in the US, recognising substantial opportunities for expansion through enhanced offshore distribution,” Lovett added. “At the same time, our dedication to the Australian market remains unwavering, and Lucinda’s dual-market expertise will support our mission to serve clients globally while prioritising Australian needs.”

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Maxim Tambling joined as Head of Human Resources on Monday, 18 November, Louise Eyres will commence as Head of Marketing in December, and Michael Lovett will return to Melbourne from Vanguard’s US head office to lead Vanguard Australia’s planned superannuation offer in January 2020.

Reporting directly to Vanguard Australia Managing Director, Frank Kolimago, the three appointments signal Vanguard’s intent to further strengthen its leadership in the financial services sector.

“As the Australian business continues to develop our organisational capabilities in support of investors, financial advisers and institutions, we’re excited to welcome Louise, Maxim and Michael to bring a valuable mix of expertise and experience to Vanguard Australia,” Mr Kolimago said.

Mr Tambling brings to Vanguard 18 years of experience as a leader and professional in human resources, having worked for a number of domestic and global organisations in Australia and the United Kingdom.

Mr Tambling holds a Bachelor of Arts in Psychology from the University of Tasmania, and a Masters of Business Administration from Deakin University.

Ms Eyres, in the newly created role of Head of Marketing, will lead a Melbourne-based team as Vanguard splits its Product and Marketing function into two more specialised functions. Evan Reedman, who has led Product and Marketing for four years, will continue to lead Vanguard Australia’s growing Product function.

Mr Lovett will relocate back to Melbourne from his role on Vanguard’s Financial Adviser Services executive team in the US, where he has been leading the Registered Investment Adviser channel since the start of 2017, supporting key relationships with financial advisers in that market. Prior to taking on this role in the US, he served as Vanguard Australia’s Head of Distribution from September 2013 to December 2016.

“Michael’s significant experience puts him in a strong position to lead our superannuation undertaking as we develop this new offer with both individual investors and financial advisers in mind,” Mr Kolimago said.

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Michael Lovett, Head of Distribution in Australia, will take on a role leading the company’s U.S. Registered Investment Advisor distribution channel. Michael joined Vanguard in 2011 as Head of Intermediary Distribution, before overseeing the integration of the sales teams across all channels and becoming Head of Distribution in 2013.

Daniel Shrimski, Chief Financial Officer in Australia will become the divisional CFO of the U.S. retail investor group. Daniel joined Vanguard in 2011, leading the largest division of the Australian business with responsibility for financial operations at both a management and statutory level, as well as having oversight of the fund accounting, administration and transfer agency services for Vanguard Australia’s managed funds and separately managed products.

Vanguard Australia Managing Director Colin Kelton highlighted Vanguard’s focus on leveraging global expertise.

“These moves highlight the global growth of our business, and the strength of leaders in Australia. More and more we look to our senior leaders as a group of talented individuals who can bring their talents to other parts of the organisation.

“Michael and Daniel’s respective work in Australia has been a significant driver of the business’ phenomenal growth across the past six years. The U.S. based teams they will be leading stand to benefit greatly from their expertise and international perspective.” Mr Kelton said.

In light of these global rotations, Vanguard Australia’s current National Sales Manager – Key Accounts, Platforms, and Research, Matthew Lumsden, will join the Australian Executive team as the new Head of Distribution.

In this role Matthew will lead the team responsible for the distribution of Vanguard’s managed funds and exchange traded funds (ETFs) to retail investors, institutional investors and financial advisers throughout Australia.

Matthew has been with Vanguard since 2010. He joined the London office as Senior Projects Counsel before moving to Hong Kong in April 2011 to lead strategic planning, legal and compliance for Vanguard in Asia.

He has more than 15 years’ experience in the financial services industry, having worked in Hong Kong, Japan, the UK and Australia. Prior to joining Vanguard Matthew worked for Lazard Asset Management as the Head of Project Management in London, and Head of Legal and Compliance in Tokyo.

“Matthew joined Vanguard Australia in 2014, bringing with him diverse experience gained in Vanguard’s European and Asian offices. He will be a valuable addition to the Australian Executive Team as we continue to build out our offering for Australian investors and advisers,” Mr Kelton said.

The executives will transition to their new roles over the coming months, and Vanguard will begin a comprehensive search to recruit a new CFO for the Australian business.

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Peker Recep

Market volatility and uncertainty have had a marked impact on how Australians with self-managed superannuation funds (SMSFs) approach investing, according to the nation’s most comprehensive research into SMSF trustees and their advisers.

Launched by Vanguard and Investment Trends in Sydney yesterday, the 2016 Vanguard/Investment Trends Self-Managed Super Fund Reports collate responses from more than 3500 SMSF trustees and 570 financial planners who advise

SMSFs, providing a comprehensive view of how SMSFs are investing and how they interact with advisers. The SMSF sector represented around $595 billion in retirement savings as at December 2015, compared to $1.4 trillion invested with APRA-regulated super funds. The total number of SMSFs grew to 567,000 by the start of this year, up 4.8 per cent over 12 months. The average SMSF balance was $1.2 million, with more than 77 per cent of funds worth more than $1 million.

Thirty-six per cent of trustees said their main investment goal for their SMSF was to build a sustainable income stream, while 50 per cent wanted at least some capital growth for their portfolio.

SMSFs cool on direct equities, hunt for yield

Investment Trends Head of Research, Wealth Management, Recep III Peker, said that although many SMSF trustees still favoured Australian equities, this year’s survey revealed a dampened outlook for domestic shares.
“It’s well documented that SMSF investors often favour Australian blue-chip shares that promise premium dividends and franking credits. But this year we saw trustees’ appetite for buying high-yielding direct shares fall,” Mr Peker said.

“Parallel to a drop in appetite for direct Australian shares, we recorded more interest in actively managed funds, infrastructure and REITs. In previous years, we have seen increased interest in fixed income products during volatile times. With interest rates at all-time lows, the data suggests SMSFs are favouring assets that they see as helping them diversify their portfolio.”

Direct equities as a share of SMSF portfolios has fallen to 38 per cent on average, compared to a peak of 45 per cent in 2013. Over the same time period, managed funds have increased from seven to ten per cent of SMSF portfolios, and exchange-traded funds have been gaining ground on more established investment vehicles to make up three per cent of SMSF holdings.

Home bias endures, but more appetite for global opportunities

Despite the reduced allocation to Australian shares, SMSF portfolios remain highly concentrated in this asset class.

The 38 per cent share of an SMSF’s portfolio represented by direct Australian share holdings includes an average of only 18 individual shares. This concentration is further exacerbated by concentrated sector exposure, with 28 per cent of SMSFs noting that more than half of their share portfolio is made up of financial shares.

Despite concerns among SMSF trustees about lower potential returns, Vanguard Australia Head of Market Strategy, Robin Bowerman, said Vanguard’s outlook for global equities while cautious was not bearish, and noted the diversification benefits of international exposure.

“This year’s research shows that many trustees are nervous about volatility generally, with increasing concern about a slowdown in China and global debt levels. While Vanguard’s Investment Strategy Group is forecasting returns to be lower than historical averages for the next decade, SMSFs shouldn’t be too disheartened by that outlook,” Mr Bowerman said.

“While forecast returns are lower, that is tempered by low inflation expectations. We expect patient investors with portfolios that are broadly diversified will be rewarded with steady growth over the long run.

“What is positive from this year’s research is that SMSF investors are looking to achieve more international
diversification through exchange-traded funds. But there is more work to be done by planners and fund managers both highlighting the benefits of international diversification and how ETFs can help investors access those markets at a lower cost.”

Ninety thousand SMSFs hold ETFs with 64 per cent saying easy access to overseas markets was a key motivation for investing in these vehicles. Of the 38,000 trustees who said they intend to start investing in ETFs in the coming 12 months, 40 per cent said they would do so to gain index exposure to international equities, while 25 per cent said they would use Australian equities index ETFs.

Accountants’ growing role in financial advice

The number of SMSF trustees with unmet financial advice needs rose from 212,000 to 255,000 over the last 12 months.

“Consistent with previous years, trustees have noted inheritance and estate planning, pension strategies, Age Pension, and longevity risk as key areas where they have unmet advice needs,” Mr Peker said.

“This year we have also seen investment strategy review and identifying undervalued assets as topics of increased interest for trustees, as well as selection of ETFs. In the current environment of market uncertainty and softer expectations for domestic investments, it’s no surprise to see trustees wanting professional help in validating their investment strategies and portfolio construction.”

Over the 12 months covered by the report, 37 per cent of SMSFs used a financial planner. This slight increase from last year represents the first uptick in SMSF’s use of planners since 2007.

The amount of business that planners derive from SMSF clients has remained steady at 19 per cent of total revenue, however, planners continue to be positive about the potential to grow this to an average of 27 per cent over the next three years. The total proportion of financial planners who work with SMSF clients also remained steady for the year at 69 per cent.

Vanguard Australia Head of Distribution, Michael Lovett, commented that under new licensing rules the roles of accountants and financial advisers were evolving.

“This year’s report showed the ongoing challenge for advisers to find and retain new SMSF clients. What Vanguard is seeing in the market, and reflected in this research, is accountants who already have deep SMSF relationships are looking to extend their offering into some areas of advice,” Mr Lovett said.

“This research, which spans 12 years, has highlighted areas of unmet advice for SMSF trustees, with a clear focus on areas outside their investment strategy.

“The impact of recent changes to the licensing rules covering the areas where accountants can – and cannot – advise clients is beginning to be felt.

“When you consider that nearly half of these trustees say they would turn to an accountant for parts of this advice, it becomes clear that financial advisers need to work more closely and potentially under different arrangements that better reflect the new licensing regime.”

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The survey shows that SMSFs are an irrefutable growth opportunity for advisers – particularly those that specialise in this area. While SMSFs account for 19 per cent of planners’ funds under advice (FUA), down from 23 per cent in 2011, those who are classified as SMSF specialists increased the proportion of their FUA from 46 per cent to 50 per cent of their total FUA.

Furthermore, the report shows that overall planners still expect their SMSF revenues to increase as a percentage of their practice revenue in 3 years – from the current 21% to 30%.

The benefit to planners in terms of revenue is clear. While planners currently derive less of their total revenue from SMSFs (21 per cent, down from 24 per cent in 2011), those practices deemed more profitable are three times more likely to have most recently seen an SMSF client than less profitable practices.

Commenting on the report, Michael Lovett, Head of Intermediary Distribution for Vanguard said:  “In what is a challenging environment for advisers, with 468,000 SMSFs in existence at the end of March 2012, there are clear opportunities that exist for planners who choose to adapt to the specific needs of this sector.”

“We know from an investor report into this sector that SMSF trustees feel they have unmet advice needs in areas such as protecting assets against market falls, investment strategy and income generation,” said Mr Lovett.

“Important to note also is the fact that this recent investor report showed that SMSF clients are clearly looking for a new kind of modular service from their adviser and are now prepared to pay up to $2,000 for additional advice.”

The research also provides an insight into the barriers that planners see in achieving growth in their SMSF client base, including administration, compliance and the grey areas that exist between planners and accountants of SMSF investors.

“The recent Future of Financial Advice announcement of changes to the exemption on limited advice and SMSF specific trustee duties may serve to provide more clarity for planners and accountants in this sector,” said Mr Lovett.

The Vanguard/Investment Trends Self Managed Super Fund Planner Report is the second in a series of research that looks at the growing SMSF sector, with a report released last month that examined the sentiment and motivations of SMSF investors. The findings represent the views of more than 500 financial planners including those who are classified as ‘Specialist SMSF planners’ (defined in the report as planners with 20 or more SMSF clients) and those who either service fewer than ten (‘SMSF Generalists’) or no SMSF clients.

16 July 2012

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