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Fund managers adapt to market pain

Aussie equities fund managers steadily improved in performance relative to benchmark from January to March, according to an updated SPIVA Australia Scorecard from S&P.

In January, only 21.6% of Australian equities (general category) funds beat the benchmarks but as the year progressed, the slice of managers beating the index grew bigger.

By February end, 41.5% managers were beating the benchmark. In March this widened to 49.2%.

"The volatile market appears to have provided active fund managers opportunities to outperform the benchmark, although the benchmark still outperformed greater than 50% of the funds," it reads.

REITs delivered strong returns as well, with nearly 60% beating their benchmarks in the best performance of all asset classes that SPIVA looked at.

"Fixed income securities are safe-haven investment during equity market crisis and corrections, though Australian bond funds tended to underperform benchmark during these periods," S&P Dow Jones Indices global research and design managing director and head of APAC Priscilla Luk said.

About 88% of the Australian bond funds lagged benchmarks in March, growing worse from January to quarter end -- reverse of what was seen in Australian equities funds.

"Australian large and mid/small cap funds suffered smaller loss than the benchmark during GFC, but no persistent outperformance were seen in other market sell-offs."


Read more: SPIVAS&P Dow Jones Indices
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