Home Hedge Funds Future Fund in management shake up as CIO departs

Future Fund in management shake up as CIO departs

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As a result of the new structure, Wendy Norris will become deputy CIO, change and innovation; hedge fund specialist Ben Samild will take on the role of deputy CIO, portfolio construction; while private equity specialist Alicia Gregory will join the senior leadership team as deputy CIO, private markets.

Healthy normalisation

Ms Brake’s departure came just six weeks after David George, the Future Fund’s deputy CIO announced he was leaving the fund to take the chief executive position at embattled fund manager Magellan.

That was among a number of senior departures in recent years.  Long-serving CEO David Neal moved to IFM Investors in 2020, while head of equities Björn Kvarnskog and ex-Macquarie star equities strategist Tanya Branwhite joined Abu Dhabi Investment Corp and NSW T-Corp.

The Future Fund has around $200 billion of assets under management, according to its last update to 31 March 2022 and has constantly warned about the risks to markets of rising inflation.

Dr Arndt said the portfolio had been positioned for a period of rising inflation but said it expected the bulk of its investments in stocks and private equity to be lower.

“The fund will be down like every other fund will be down when the equity market finishes the year 20 per cent down, but a lot less than it might have been,” Dr Arndt said.

He said the fund had benefited from an increased allocation to macro hedge funds which had shorted bonds and stocks in expectation of rising inflation and delivered returns of about 20 per cent.

Dr Arndt said he was also unfazed by declines in the value of venture assets.

“We have a very big venture capital portfolio, and we continue to have conviction in that. But we’re going in early as we think the returns come from good ideas not inflated valuations.”

The Future Fund, he said maintained its view that in the current environment, the value of skilled investment managers only increased, so it would have to “keep getting better” at finding talent.

But he said the interest rate induced shake-up of financial assets was positive and would lift overall returns. “The world has changed and what is happening is healthy as we move from emergency settings to something more normal.”

“Economies are healthy, unemployment is low GDP is reasonable and so it’s appropriate to normalise [interest rates].”

“Financial markets need to adjust, and maybe they have just got bit over their skis thinking interest rates would stay negative for a long time.”

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