Australian Catholic Super breaks new ground with custom equities strategy for RetireSmart members
The $9 billion industry superannuation fund Australian Catholic Superannuation & Retirement Fund (ACSRF) has joined forces with the global specialist implementation manager Parametric Portfolio Associates LLC (‘Parametric’) to offer members in its award-winning RetireSmart option a new custom-designed equities strategy with a focus on capital retention and income.
In a new mandate, Parametric will manage the equity portfolio as part of ACSRF’s RetireSmart pension solution, which was launched in 2015 around the concept of separate ‘cash’ and ‘growth’ asset buckets for retirees.
Parametric, who manages existing equity portfolios for ACSRF, collaborated with the fund to co-design the new approach to equity investing in retirement.
The equities strategy breaks new ground in the superannuation industry, which has traditionally designed equities strategies for ‘accumulation-phase’ members still working and saving for their retirement. With a specific focus on the very different needs of ACSRF’s retired members, Parametric’s goal will be to ensure RetireSmart equities offer downside protection in falling markets and meet specific yield targets above market benchmarks to provide members with a reliable income stream.
Greg Cantor, CEO of ACSRF, believes the new approach shows some of the fund’s best attributes: “We didn’t want to wait for the Government to impose its ‘CIPR’ retirement product timeline on us or the rest of the industry to really move on this. We have nearly one-third of our members in retirement, and many more making plans to retire in the very near future. This particular cohort of members have needs that, we felt, required a customised solution. We have established a reputation for innovation across the fund and we are building on this further by rethinking the investment challenge for retired members.”
Chris Briant, Head of Eaton Vance Australia, Parametric’s Australia-based affiliate, says: “ACSRF has rightly recognised the need for a more thoughtful approach to equity investing for retired members, with the COVID-19 pandemic providing a stark reminder of this investment reality.” Briant also applauded the fund for focusing on its members’ needs and prioritising the issue: “It’s to ACSRF’s credit it has moved ahead of the industry curve by establishing the RetireSmart pension solution and continuing to enhance it.”
A hallmark of the new equities approach has been the extensive research collaboration between ACSRF and Parametric over the past year to workshop different ideas. Key to this particular portfolio will be its ability to generate consistent income for its members whilst ensuring that capital balances are protected from market drawdowns.
Briant says: “We are proud of our investment partnership with ACSRF and are thrilled to have helped them apply our specific equity factor investing, defensive equity and tax management capabilities to a custom member-focused retirement solution.”
For ACSRF’s Cantor, the commitment to partnership is empowering: “We seek investment partners with collaborative cultures and a willingness to customise – these are really powerful tools for us in continuing to lead the way in the retirement solution design space. Ultimately, it’s easy to ‘talk the talk’ about being focused on members, but actually delivering thoughtful new solutions like this to members – especially in these challenging investment times – shows that we really are living this principle and putting members first.”
For more information please contact:
Simrita Virk at Shed Connect
Since 1981, Australian Catholic Super has helped people who work in Catholic education, healthcare, aged care and welfare plan for their future by providing excellent superannuation, insurance, retirement planning and financial planning services. We are a Catholic super fund in Australia with over 90,000 members, 15,000 employers and a portfolio worth over $9 billion as of May 2020. We’re the super fund of choice for the Catholic sector and we’re also open to anyone who’s eligible for super.
Parametric Portfolio Associates® LLC (Parametric), headquartered in the U. S. in Seattle, Wash., is registered as an investment adviser with the Securities and Exchange Commission (“SEC”) under the Investment Advisers Act of 1940. Parametric’s advisory services are offered and promoted in Australia by its affiliate, Eaton Vance Management (International) Limited (‘EVMI’). EVMI is authorised and regulated by the Financial Conduct Authority (“FCA”) in the United Kingdom and is located at 125 Old Broad Street, London, EC2N 1AR. Parametric and EVMI are both indirect, wholly-owned subsidiaries of Eaton Vance Corp. Parametric and EVMI are exempt from the requirement to hold an Australian financial services license under the Australian Corporations Act 2001 (Cth) (Corporations Act) in respect of the provision of financial services to wholesale clients as defined in the Corporations Act and pursuant to the Australian Securities and Investments Commission's (ASIC) Class Order 03/1100 and 03/1099, respectively. SEC and FCA rules and regulations may differ from Australian law. Parametric and EVMI are not licensed tax agents or advisers and do not provide tax advice in Australia or any other country. This material is intended for wholesale use only and is not intended for distribution to, nor should it be relied upon, by retail clients.
With $287.4 billion USD of assets under management as at April 30, 2020, Parametric is a global asset management firm offering investors a variety of portfolio solutions, including tax-managed centralised portfolio management, tax-managed indexing and factor investing strategies, as well as emerging markets and defensive equities strategies. Parametric Portfolio Associates® LLC is a wholly owned subsidiary of Eaton Vance Corp, one of the world's most dynamic global asset management companies.