STRATEGIES CONFERENCE 2018 - PROGRAM & PREP

Investment portfolio construction is, by definition, an exercise in long-term thinking. By creating strategies that blend asset classes to achieve future returns, practitioners seek to meet the distant future financial needs of individuals.

Yet the process is fraught with difficulty due to the inherently uncertain nature of financial markets, powerful secular and structural developments, and clients’ desires to be both certain of meeting their investment goals while avoiding any sting on the downside during the journey. Given these uncertainties and competing priorities, are future-proof portfolios achievable?

Strategies Conference 2018 will facilitate debate on a selection of contemporary and emerging portfolio construction strategies, with particular emphasis on the challenges of building future-proof portfolios.

 

QUICKLINKS

Overview & registration  When, where, where to stay, who it's suited to | Registration options, terms and conditions

Program & Prep - Program at a glance, Keynote Faculty, Detailed program, and Prep materials (pre-reading, pre-viewing)

 

PROGRAM

Portfolio Construction Forum Strategies Conference is THE investment strategies conference of the year. The jam-packed two-day program is designed and curated by our specialist, experienced and independent team, and features more than 40 leading investment thinkers from around the world, contributing their best ideas on contemporary and emerging portfolio construction strategies, in the context of the theme "Future-proof portfolios?

Program at a glance

Keynote Faculty

Detailed program and Prep materials

PROGRAM AT A GLANCE

Wednesday 22 August 2018

7.15am-7.45am - arrive, check in, grab a coffee/tea

7.45am-8.10am - on the move to the Theatre

8.10am - take your seat in the theatre

8.15am - Critical Issues Forum 1
Future-proof portfolios - Graham Rich

8.45am - Critical Issues Forum 2
Past performance is no indicative of future performance - Marc Seidner, CFA

9.20am - Critical Issues Forum 3
Why we get it wrong - culture not cmpanies dictate trends - Tassos Stassopoulos

10.00am - morning break

10.30am - on the move to the Theatre

10.40am - Critical Issues Forum 4
Building future-proof portfolios requires emotional agility - Susan David, PhD

11.50am - On the move to Special Interests Forum 1

12.05pm - Special Interests Forum 1
Choice of four sessions - refer full program below

1.15pm - lunch break

1.50pm - On the move to the Theatre

2.00pm - Critical Issues Forum 5
Unconstrained investing is essential in an uncertain world - Prashant Chandran, CFA

2.40pm - Critical Issues Forum 6
Foreign currency should be treated as a complex asset class - Olivia Engel, CFA

3.15pm - afternoon break

3.40pm - On the move to the Theatre

3.50pm - Critical Issues Forum 7
Diversification is not a free lunch - Tim Farrelly

4.20pm - Critical Issues Forum 8
Key takeouts

4.50pm - Critical Issues Forum 9
The tech revolution will radically change how the economy works - Chris Berg, PhD

5.30pm - Networking Reception

7.00pm - Day one ends

Thursday 23 August 2018

7.15am-7.45am - arrive, grab a coffee/tea

7.45am-7.50am - On the move to the Theatre

7.50am - take your seat in the theatre

8.00am - Critical Issues Forum 10
Designing portfolios for scenarios is critical to future-proof portfolios - Graham Rich, Jeremy Lawson, and Expert Panel

9.25am - morning break

9.55am - On the move to the Theatre

10.05am - Critical Issues Forum 11
'Future-proof' is too hard but we can better meet client needs - Professor Ron Bird

10.40am - Critical Issues Forum 12
Data analytics offers little insight on complex problems - Peter Bossaerts, PhD

11.20am - On the move to Special Interests Forum 2

11.30am - Special Interests Forum 2
Choice of four sessions - refer full program below

12.40pm - lunch break

1.15pm - On the move to Special Interests Forum 3

1.25pm - Special Interests Forum 3
Choice of four sessions - refer full program below

2.35pm - afternoon break

3.00pm - On the move to the Theatre

3.10pm - Critical Issues Forum 13
China will be a high-tech global power within two decades - Linda Jakobson

3.45pm - Critical Issues Forum 14
The new world war is a threat to future-proof portfolios - David Sanger, followed by a panel featuring David, Linda Jakobson and Tom Switzer

5.00pm - Networking Drinks

6.00pm - Strategies Conference 2018 ends

KEYNOTE FACULTY

 

Markets (Geopolitics)
David Sanger, National Security Correspondent, The New York Times, (Washington DC)
David has been on three teams that have won Pulitzer Prizes. His newest book, “The Perfect Weapon” examines the emergence of cyberconflict and how it's changing the nature of global power. 

 

Markets | Finology
Tassos Stassopoulos, Founder & CIO, Trinetra Investment Management (London)
After a career with AllianceBernstein and Credit Suisse, Tassos founded Trinetra in 2016. The firm uses ethnographic research to generate insights into growth opportunities in emerging markets.

 

Finology
Susan David, PhD, Harvard Medical School (Boston)
An award-winning psychologist on the faculty of Harvard Medical School, Susan is the author of #1 Wall Street Journal best-selling book, Emotional Agility, described by Forbes.com as "a powerful book on embracing your core values, being more decisive, and committing to meaningful change".

 

Markets | Strategies (Debt - Global)
Marc Seidner, CIO Non-Traditional Strategies, PIMCO (New York)
In addition to his role as CIO, Marc is a managing director and head of portfolio management in PIMCO's New York office, and a generalist portfolio manager and member of the Investment Committee.

 

Strategies (Equities - Global)
Olivia Engel, CFA, Active Quantitative Equities, State Street Global Advisors (Boston)
Olivia has global oversight of the broader AQE research agenda, investment process, portfolio management, and product innovation. Previously, she led the AQE team in Asia Pacific, and was responsible for all benchmark unaware strategies globally for the team.

 

Philosophy | Strategies
Peter Bossaerts, PhD, Professor of Experimental Finance, University of Melbourne (Melbourne)
Peter is one of the world’s leaders in experimental decision making research in finance and economics. His work is widely regarded as having transformed society's understanding of how humans perceive and take risks.

 

Strategies (Debt - Global)
Prashant Chandran, CFA, Head of Derivatives, Western Asset Management (Pasadena)
In addition to his role as Head of Derivatives, Prashant is a Senior Portfolio Manager, member of the Investment and Risk committees, and a member of Western Asset Management's Investment Advisory Committee that debates, shapes, and presents the firm’s global macro views.

Plus...
- Tim Farrelly,
Principal, farrelly's Investment Strategy (Sydney)
- Ron Bird, Professor, University of Technology Sydney (Sydney)
- Linda Jakobson, CEO, China Matters (Sydney)
- Chris Berg, Senior Research Fellow, RMIT Blockchain Innovation Hub (Melbourne)
- Jeremy Lawson, Chief Economist, Aberdeen Standard Investments (Edinburgh)
- Ashley Owen, CFA, Chief Investment Officer, Stanford Brown (Sydney)
- Brigette Leckie, Partner & Chief Investment Officer, Koda Capital (Sydney)
- Debbie Alliston, Head of Multi-Asset Portfolio Management, AMP Capital (Sydney)
- Brett Gillespie, Head of Global Macro, Ellerston Capital (Sydney)
- Kerr Neilson, Founder, Platinum Asset Management (Sydney)
- Mark Burgess, Independent Chairman, Yarra Capital Management (Melbourne)
- Tom Switzer, Executive Director, The Centre for Independent Studies (Sydney)

... and another 22+ local and international investment thinkers....

WEDNESDAY 22 AUGUST 2018

 

8.15am-8.45am:  Critical Issues Forum 1

 

Strategies
Future-proof portfolios?
Investment portfolio construction is, by definition, an exercise in long-term thinking. By creating strategies that blend asset classes to achieve future returns, practitioners seek to meet the distant future financial needs of individuals. Yet the process is fraught with difficulty due to the inherently uncertain nature of financial markets, powerful secular and structural developments, and clients’ desires to be both certain of meeting their investment goals while avoiding any sting on the downside during the journey. Given these uncertainties and competing priorities, are future-proof portfolios achievable?

- Graham Rich, Managing Partner & Dean, Portfolio Construction Forum (Sydney)

Prep!
-
Future-proof portfolios
- Future-proof portfolios are entirely achievable

 

8.45am-9.20am:  Critical Issues Forum 2

 

Markets | Strategies
Past performance is not indicative of future performance

Any time you read a fund prospectus, you come across the familiar phrase: “Past performance is not indicative of future performance”. It’s so common we almost ignore it, but it goes to the heart of how we should view and manage risk and return as we strive to future-proof portfolios. And never more so than now. In an environment of increasing volatility, decreasing liquidity and greater idiosyncratic risk, investors should prepare for a new era of potentially radical change. Active management, robust fundamental research, and incorporating diverse perspectives will help investors successfully navigate the path forward?

- Marc Seidner, CFA, CIO Non-Traditional Strategies, PIMCO (New York)

 

9.20am-10.00am:  Critical Issues Forum 3

 

Markets | Finology
Why we get it wrong - culture not companies dictate trends

Society and consumer trends are changing at such breath-taking speed that even global companies struggle to keep up. Dominating brands are launched almost by accident, and many companies have surprisingly limited insight on how they can stay popular and relevant in the age of global information and social media. To understand which trend will dominate, investors need to entirely rethink their processes, assumptions and research approach, to focus on the cultures of consumers in different markets. Only by thinking like new brands themselves, can they identify and invest in the next powerful emerging trend.

- Tassos Stassopoulos, Founder & CIO, Trinetra Investment Management (London)

Prep!
 -
Future shocked: DM legacy systems are no match for China's innovative Fintech

 

10.00am-10.40am:  Morning break

 

10.40am-11.50am:  Critical Issues Forum 4

 

Finology
Building future-proof portfolios requires emotional agility
The future is, by definition, uncertain – as is the nature of financial markets. This, along with the current Australian financial services environment, powerful secular and structural trends, and clients’ often conflicting goals, combine to create a high degree of ambiguity and complexity (often causing fear and stress) for practitioners and advocates as they strive to build quality investment portfolios. To cope and prosper in such an environment, we need to be emotionally agile, in order to align our values and actions and, in turn, help investors achieve their distant future financial goals.

- Susan David, PhD, Harvard Medical School & Evidence Based Psychology (Boston)

Prep!
  -
Emotional Agility

 

11.50am-12.05pm:  On the move

 

12.05pm-1.15pm:  Special Interests Forum 1

 

Room 1

 

Philosophy | Strategies (Equities - Global)
Integrate ESG considerations to help future proof portfolios
ESG and sustainable investing has gone from a niche investment idea to becoming more and more mainstream every day. It’s a structural shift and here to stay but equally one that brings new challenges to investors and those aiming to build quality investment portfolios for them. It is vital to think about both the risk and opportunities that sustainable investing provides and define a framework that matches your investment beliefs.

- Jane Wadia, Global Head of Client Portfolio Management and Product Strategy, AXA Investment Management (London)

 

Markets | Strategies (Debt - Australian)
Australian private debt can help future proof portfolios
Private debt affords portfolios a number of attractive structural protections through seniority, security and covenants, which combine to mitigate the risk of the investment and is particularly important given the stage in the current credit cycle. Given the key defensive attributes of Australian private debt, at this late cycle phase of the market, it should be included in all portfolios that are able to invest in illliquid assets..

- Bob Sahota, MD & Chief Investment Officer, Revolution Asset Management (Sydney)

 

Room 2

 

Strategies | Investing (Equities - Global)
In the AI age, active managers making smart human decisions will win
AI-based investment solutions will change the landscape much faster than expected. The adoption of machine learning is unlikely to be smooth, but will put a spotlight on how active managers make investment decisions. The importance of making good human decisions will be amplified, and future proofing this will require managers to have the right individual and team behaviours to cope with the disruptive changes that AI brings.

- William Low, Head of Global Equity, Nikko Asset Management (Edinburgh)

 

Investing (Equities - Australian)
Owner managed companies are the backbone of a good portfolio
Common criticisms of senior management is that CEOs of listed companies rarely last long and while they are in control they are too focused on short-term outcomes, especially when they have an incentive to boost the share prices of their companies in the near term. Such allegations can’t be made as easily against family-owned and family-managed businesses. Research shows that owner-manager businesses reward their long-term (non-family) investors because they instill a stability, a culture, and a focus that is geared towards the long term. Companies with owner-management profiles help future-proof a portfolio by providing long-term stability – a “backbone” to the portfolio. The issue for investors is finding the right set of owner-managed companies.

- Matt Williams, Portfolio Manager, Airlie Funds Management (Sydney)
- Emma Goodsell, Deputy Portfolio Manager, Airlie Funds Management (Sydney)

 

Room 3

 

Strategies (Equities - Global)
RoI is everything – abstractions are distractions

Institutionally designed portfolios can be puzzling. Examples include adherence to benchmarks, over-diversification across managers, obsession with sectoral exposures like infrastructure or real estate and macro guessing-games. We are all forced to invest to get a return on our savings, but as an industry we have overcomplicated this and at times not delivered. The best future proofing possible is to understand what your holdings can pay you. Work from first principles – let simple, a priori return potential be your guide.

- Andrew Clifford, CEO & Chief Investment Officer, Platinum Asset Management (Sydney)

 

Markets | Investing (Alternatives)
People underestimate the depth & length of “normal” drawdowns
Due to inherent biases in investing, the Sharpe ratios of investor portfolios are often not as high as investors expect. In reality, a realistic Sharpe ratio for any one strategy or manager is in the range of 0.3 to 0.5 as evidenced by equity and bond markets, for example. But just how low can a random walk of a given Sharpe ratio wander through the natural realisation of risk? The depths and lengths of “normal” (i.e. expected – or, more scientifically stated, statistically insignificant) drawdowns are often underestimated by investors. Armed with this information when seeking to build future-proof portfolios, the level of poor performance of a fund, strategy or manager can be put into context and objective decisions can be taken on whether or not to remain invested.

- Philip Seager, PhD, Head of Alternative Beta Strategies, Capital Fund Management (Paris)

 

Room 4

 

Strategies (Multi-Asset)
Asset managers must innovate to meet retiree drawdown needs
An aging population, maturing superannuation system and government policy are dramatically increasing the need for effective solutions for the retiree population. Investment managers have, historically, focused on investment needs during accumulation, and annuity costs have been driven to extremes by continued low interest rates. The end result is a dearth of compelling options for retirees. A range of solutions can start to meet this challenge including: a pre-retirement portfolio that aims to preserve annuity purchasing power; a decumulation solution which guarantees payments in retirement; and, a retirement strategy which factors longevity and inflation into its cash flow profile – demonstrating that asset managers can create solutions which more closely meet retirees needs.

- Alastair Baillie Strong, Solutions Designer, Fidelity International (Hong Kong)

 

Strategies | Investing (Alternatives)
Human + machine in investing is better than either in isolation

Systematic investment managers are entirely reliant on technology to access and process enormous volumes of data through trading algorithms, and to trade hundreds of markets globally. The scale, speed and consistency achievable by these machines cannot be replicated by humans. But randomness can make the data lie. To future proof portfolios, you need human skill and judgment to distinguish between the purely random and real investment insights. This is the power of combining machines and humans.

- Nick Thomas-Peter, PhD, Senior Vice President, Winton Group (London)

Prep!
 -
Decoding AI’s Role in Financial Services

 

1.15pm-2.00pm:  Lunch break

 

2.00pm-2.40pm:  Critical Issues Forum 5

 

Strategies (Debt - Global)
Unconstrained investing is essential in an uncertain world

In a world where risks are more varied and non-quantifiable, unconstrained strategies can be supportive in both maximising portfolio returns and reducing risk, allowing greater bandwidth to deliver returns via a wider range of drivers, regardless of market direction. That said, in detaching from the anchor that is the index, it is easy to loosen the grasp on risk. Therefore, in adopting an unconstrained approach to help future-proof portfolios, one must adhere to a clear philosophy and framework for apportioning risk in unconstrained portfolios.

- Prashant Chandran, CFA, Head of Derivatives, Western Asset Management (Pasadena)

 

2.40pm-3.15pm: Critical Issues Forum 6

 

Strategies (Equities - Global)
Foreign currency should be treated as a complex asset class

Global asset classes provide access to new and diverse investment opportunities. However, investing overseas introduces foreign currency exposure to a portfolio. Rather than treating it as an afterthought, investors should treat foreign currency as an asset class in its own right, deserving of the same level of scrutiny. Investors looking to future proof their portfolios should consider both short- and long-term currency risks, as well as where the best return opportunities lie. Australian investors have a different perspective on foreign currency to investors elsewhere in the world, and this should be reflected in how local portfolios are built.

- Olivia Engel, CFA, Senor Managing Director & CIO Active Quantitative Equities, State Street Global Advisors (Boston)

Prep!
 -
Managing currency exposures

 

3.15pm-3.50pm:  Afternoon break

 

3.50pm-4.20pm:  Critical Issues Forum 7

 

Strategies (Multi-Asset)
Diversification is not a free lunch
Harry Markowitz called diversification "the only free lunch in finance" and his elegant mathematical theory won him a Nobel Prize and laid the foundations for Modern Portfolio Theory. However, while diversification can be a free lunch, it can’t be taken for granted. Not all diversification is good and not all lowly correlated assets are good diversifiers. For diversification to help future-proof portfolios, we have to think deeply about what are the essential inputs into the Markowitz approach – not only correlations but also expected returns and risks. The results of such thought will probably be deeply unsatisfying for the mathematically inclined. Instead, the answers when designing well diversified portfolios will often lie with good rules of thumb.

- Tim Farrelly, Principal, farrelly's Investment Strategy (Sydney)

 

4.20pm-4.50pm:  Critical Issues Forum 8

 

 

Strategies
Key Takeouts

- Delegate Panel

 

4.50pm-5.30pm:  Critical Issues Forum 9

 

Philosophy | Markets
The tech revolution will radically change how the economy works

The Australian (and global economy) is facing decades of significant technological change that will reshape how we work, where we work, and how we relate to each other economically and politically. These changes are also poised to seriously disrupt public policy and financial markets - and are therefore a challenge to building future-proof portfolios. What we need now is a revitalisation of liberal economics and public policy to adapt and adjust to an economy that will be more rapidly changing than at any other time in human history.

- Chris Berg, PhD, Senior Research Fellow, RMIT University (Melbourne)

 

5.30pm-7.00pm:  Networking Reception

 

7.00pm:  Day one ends

THURSDAY 23 AUGUST 2018

 

8.00am-9.25am:  Critical Issues Forum 10

 

 

Markets | Strategies
Designing portfolios for scenarios is critical to future-proof portfolios

A disciplined, scenarios-based approach to determining your views on the outlook for markets and then the asset allocation implications can help future-proof portfolios. Determining investment strategy by analysing issues from a number of viewpoints allows you to arrive at plausible scenarios for how the future may unfold. This hypothetical Investment Committee meeting will consider the asset allocation implications of three relevant, forward-looking economic and market scenarios which have a reasonable probability of occurring during the next two to three years: 1. lower for longer/neutral; 2. US isolationism/bear; and 3. Global reflation/bull. After our Expert Panel debates the scenarios, the Investment Committee (delegates) will determine the probabilities of the three scenarios. The Expert Panel will then consider the portfolio construction implications before the Investment Committee votes on its asset allocation decisions.

Investment Committee

  Chair - Graham Rich, Dean, Portfolio Construction Forum (Sydney)

Economist – Jeremy Lawson, Chief Economist, Aberdeen Standard Investments

Expert Panel

           
- Ashley Owen, Chief Investment Officer, Stanford Brown (Sydney)
- Brigette Leckie, Chief Investment Officer, Koda Capital (Sydney)
- Debbie Alliston, Head of Multi-Asset Portfolio Management, AMP Capital (Sydney)
- Tim Farrelly, Principal, farrelly's Investment Strategy (Sydney)
- Brett Gillespie, Head of Global Macro, Ellerston Capital (Sydney)
- Kerr Neilson, Co-Founder & Investment Analyst, Platinum Asset Management (Sydney)
- Mark Burgess, Non-executive chairman, Non-Executive Director (Melbourne)

Prep!
 -
Designing for scenarios is critical to future-proof portfolios

 

9.25am-10.05am:  Morning break

 

10.05am-10.40am:  Critical Issues Forum 11

 

Strategies | Investing
'Future-proof’ is too hard but we can better meet client needs

Investors like to have their cake and eat it – that is, they like investment returns (the higher the better), but dislike volatility (particularly negative returns) but they don’t mind positive skewness (the characteristic that causes people to buy lottery tickets even though the expected impact on their wealth is negative). It is possible to engineer investment returns that meet those requirements, by using portfolio insurance to protect a portfolio. The bottom line is that investors can have their cake and eat it, by being better off in terms of all the three characteristics that investors favour.

- Ron Bird, Professor, University of Technology Sydney (Sydney)

 

10.40am-11.20am: Critical Issues Forum 12

 

Philosophy | Strategies
Data analytics offers little insight on complex problems

We often think of investments as playing roulette, with “laws” that somehow can be discovered using statistics or machine learning. Yet many investment problems we face actually fall in a completely different category. Firm valuation, determining what to look for when predicting markets – even portfolio construction – are not statistical problems, but complex decision problems that are central to building future proof portfolios. They require a very different, methodic approach. The best investors are those who follow disciplined approaches that resonate with the theory of computation – and you can train yourself in one such approach using a simple game.

- Peter Bossaerts, PhD, Professor of Experimental Finance, University of Melbourne (Melbourne)

Prep!
 -
Computational Complexity and Finance

 

11.20am-11.30am:  On the move

 

11.30am-12.40pm: Special Interests Forum 2

 

Room 1

 

Strategies (Equities - Global)
Investment risk has nothing to do with benchmarks

Investment risk is usually defined with regard to deviation from arbitrary benchmarks. But this definition is at best misleading and at worst, damaging to the efficient allocation of long-term capital. Instead, to future proof portfolios, investors looking to maximise returns should regard risk simply as the risk of losing money and in turn, best manage this risk by taking a long-term time horizon. The Chinese Beverage Sector is a case study that illustrates the importance of time horizon and downside risk for investors hoping to meet long-term return objectives. An analysis of supply chains, water scarcity, obesity and climate change clearly demonstrates the importance of managing these risks as a way of generating long-term returns for investments. In order to cement an absolute return mindset and truly ‘future-proof’ a portfolio, an investor cannot be fixated on short-termism - monthly returns, annual performance fees, yearly manager bonuses or tracking error relative to any benchmark. An investor must view risk as the risk of losing money.

- David Gait, Joint Managing Partner, Stewart Investors (Sydney)

 

Strategies | (Equities - Global - Specialty)
Infrastructure is critical to future-proofing portfolios

Building long-term portfolios designed to meet investors future needs and living standards requires high allocations to assets that provide: resilient corporate earnings during times of economic stress (reducing drawdown risk); low disruption risk to future business models; predictable growing dividends protected from inflation and paid throughout a cycle; and, diversification benefits to the portfolio. Infrastructure as an asset class has met these criteria during four very different recessionary periods, reinforcing the need for allocations to the asset class, especially when building goals-based portfolios.

- Nick Langley, Co-Chief Executive & Co-Chief Investment Officer , RARE Infrastructure (Sydney)

 

Room 2

 

Strategies | Investing (Equities - Global)
Investors need style neutral global equities exposure

We all know about the drivers of investment returns, often referred to by ‘style’ or ‘factor’ – but when to pick which ‘style’ remains one of the most difficult disciplines of investing. As computing power has increased, so too has our ability to identify more of the underlying components of performance and better understand the relationships between these factors. Investors are rightfully benefiting from increased scrutiny around ‘pactive’ portfolios which charge high fees to replicate cheap (naïve) factors. But the more valuable evolution is a consideration of how to build stronger portfolios for Australian investors that already have meaningful style biases. To help future proof portfolios by improving the accuracy of intended portfolio risk, investors should consider using a style neutral option, particularly for global equities, to offset the likelihood that they are already invested in heavily style biased portfolios.

- Ian Paczek, PhD, CFA, Senior Portfolio Manager & Executive Director, UBS Asset Management (London)

 

Investing (Equities - Australian)
Good governance is a strong amplifier of small cap performance

Many of Australia’s small companies are our potential future leaders. The ASX 300 provides active investors a universe that increases the ability to deliver long-term alpha and greater diversification, helping to maximise potential long term returns. A sharp focus on corporate governance can assist investors in identifying those high quality, sustainable businesses that can last the distance thereby ‘future proofing’ a portfolio. Best practice in corporate governance can deliver better returns in the medium to long term for investors when harnessed with the potential growth of good quality Australian Small Cap companies.

- Michelle Lopez, CFA, Senior Investment Manager, Aberdeen Standard Investments (Sydney)

 

Room 3

 

Investing (Equities - Global)
Capturing future earnings upgrades leads to outperformance

Research shows that when companies deliver earnings which are underappreciated by investors, they outperform. To exploit this, objectively obtained data on earnings surprises, as well as quality and valuation, can be analysed to build a future-proofed portfolio. Avoiding value traps and, at the other end of the earnings cycle, growth traps, are critical success factors. Businesses adapting successfully to disruption exist across all industries and can be identified irrespective of prevailing market conditions. Finding those with improving earnings outlooks can deliver a future proofed portfolio.

- Nikki Thomas, CFA, Portfolio Manager, Alphinity Investment Management (Sydney)

 

Philosophy | Strategies (Debt - Australian)
Impact investing is the way of the future for fixed income

Impact bonds are issued by companies, agencies or governments with the explicit intention to generate meaningful and measurable positive social and/or environmental outcomes, alongside a mainstream financial return. The impact investment market is growing - driven, in part, by investors’ desire to also understand the non-financial outcomes of their investments. In addition, there is growing evidence that investing for return while generating a positive impact is a holistic way for investment professionals to create portfolios that are fit for the future.

- Stephen Fitzgerald, Managing Partner & Co-Founder, Affirmative Investment Management (London)

 

Room 4

 

Markets | Investing (Equities - Global)
A borderless approach delivers better EM investment outcomes

Emerging markets have often been considered a tactical investment opportunity and typically treated as a homogeneous group. However, the investment opportunity in EM is greater than just the companies domiciled there. There are real opportunities to be found in multinational corporations – including those with significant revenue in EM, but domiciled elsewhere (like Nestlé). In essence, investing in global growth should not simply be defined or determined by where a company receives its mail. The distinction between EM/DM is no longer relevant, and a borderless approach with a blend of EM/DM economies produces a better investment outcome.

- Andy Budden, Investment Director, Capital Group (Singapore)

 

Investing (Debt - Global)
ABS are now more "Moneyball" than "Big Short"

Asset Backed Securities (ABS) are still feared and arguably misunderstood for their role in the Global Financial Crisis. In fact, global ABS were directly tested and survived the challenges of 2008. Moreover, a combination of legislative, industry and structural changes since the GFC have strengthened the overall investment thesis. Paradoxically, ABS provide wider credit spreads over comparatively rated investment grade corporate debt and may in fact may be more defensive than government bonds and equities in a bear market for rates. In today’s rising rate environment, global ABS, which are inherently floating, are now well placed to help "future-proof" portfolios.

- Richard Quin, CEO & Lead Portfolio Manager, Bentham Asset Management (Sydney)

 

12.40pm-1.25pm:  Lunch break

 

1.25pm-2.35pm: Special Interests Forum 3

 

Room 1

 

Strategies (Multi-Asset)
Bin the crystal ball - focus on value, trend & diversification

You don’t have to forecast the future to future proof a portfolio. While market strategists have been shown to do no better than a coin toss, a robust approach to asset allocation focusing on factors that do have predictive power – valuations and trend – can create a portfolio that is robust to changing markets. In addition, diversification is the only free lunch in investing, which has fuelled great interest in alternatives, but hedge funds and many unlisted assets just repackage risks a portfolio is already exposed to, and effective diversification relies on access to genuinely skill-based strategies at sensible prices.

- Michael Blayney, Head of Multi-Asset, Pendal Group (Sydney)

 

Philosophy | Investing (Equities - Global)
ESG integration is mission critical

ESG integration and materiality will stand the test of time and help us all to build robust and resilient portfolios for the future prosperity of our clients. Future proofing portfolios means ensuring those building portfolios develop a deep understanding of why something matters. Materiality allows the prioritisation and focus on the issues that will ultimately deliver long-term value. As disruption transforms global economies and markets become ever more efficient, effectively integrating material ESG factors is mission critical to successfully identifying the companies that can sustainably add value through market cycles.

- Michael Cantara, CFA, Senior Managing Director - Global Client Group, MFS Investment Management (Boston)

 

Room 2

 

Strategies (Equities - Global)
Factor investing increases your probability of success

Investors are adopting investment strategies based on asset pricing anomalies documented in the academic literature, otherwise known as Factor Investing. However, not all factor investing strategies are created equal. Those looking to embrace factor investing need to understand some core principles of factor investing strategies such as: avoiding unrewarded risks; combining factors efficiently; and, factor index arbitrage. This will then create a future-proof portfolio for the new world, more reliable alpha, lower volatility, all while lowering portfolio costs.

- Frank Wirds, CFA, Client Portfolio Manager, Robeco (Hong Kong)

Prep!
-
Academic Knowledge Dissemination in the Mutual Fund Industry

 

Markets | Strategies (Equities - Australian)
Valuation mistakes will prove very costly in a post QE world

Future proofing portfolios is a difficult task – partly due to today’s demanding valuations and partly because the future is intrinsically unknowable. Yet as valuations become stretched across the spectrum of asset classes, the efficacy of monetary policy diminishes and a record number of Australians are nearing or entering retirement, the stakes have risen. Investors need to search as broadly as possible for assets priced to deliver reasonable returns, carefully weight today’s yield against long horizon return requirements and perhaps most importantly guard against sequencing and drawdown risks. There are no “set-and-forget” strategies in a world of ever-changing prices.

- Philipp Hofflin, PhD, Portfolio Manager/Analyst, Lazard Asset Management (Sydney)

 

Room 3

 

Strategies (Multi-asset)
All active? All passive? And/or gives better portfolio outcomes

Imagine a world with only two fund options: a passively managed fund and an actively managed fund with similar levels of volatility. Passive funds offer low-cost benchmark tracking, leading to a tight range of relative returns. Active funds offer the potential for outperformance in exchange for a wider range of relative returns. The decision to use active, passive, or a combination of both investment types in a portfolio is too often framed as an either-or debate. Both active and passive investments have the potential to help future-proof portfolios, providing they anchor on low cost and patience.

- Daniel Reyes, CFA, Principal - Investment Management Group, Vanguard Investments (Melbourne)

 

Markets | Strategies (Equities - Global)
Future proofed portfolios need growth equities

Growth investing is essential to future proof a portfolio. If investing in equities and following the index then by definition, an investor is investing in growth. However, investors should learn the lessons of history. When powerful structural changes occur, it creates very divergent paths for different companies (even in the same industry). Structural growth companies can easily grow into their higher near-term valuations, while stocks trading a ‘cheap PEs’ but on the wrong side of structural change are seldom protected by their valuation. Looking beyond near-term valuation multiples can help identify the next great winners and also help avoid the losers. Without growth investing, a portfolio is only focusing on only one side of the equation.

- Nick Griffin, Founding Partner & Chief Investment Officer, Munro Partners (Melbourne)

 

2.35pm-3.10pm:  Afternoon break

 

3.10pm-3.45pm:  Critical Issues Forum 13

 

Markets (Geopolotics)
China will be a high-tech global power within two decades

The People's Republic of China (PRC) invests heavily in high technology research. It is set to become a global power within two decades in numerous spheres including nanotechnology, artificial intelligence, space exploration, and medical research. The world will certainly benefit from the PRC's technological ambition. For example, PRC scientists are expected to find long sought-after cures to deadly diseases. However, PRC technological prowess also has challenging implications, starting with PRC ability to steal technology and conduct cyber attacks as well as the development of forms of social control which are contrary to democratic norms.

- Linda Jakobson, Founding Director & Chief Executive Officer, China Matters (Sydney)

 

3.45pm-5.00pm:  Critical Issues Forum 14

 

Markets (Geopolitics)
Cyber conflict is a threat (to future-proof portfolios)

"There are two kinds of big companies in the US. There are those who've been hacked by the Chinese and those who don't know they've been hacked by the Chinese."
- James Comey, then FBI Director, October 2014
In the cyber world today, we are somewhere around World War I. A decade ago, there were three or four nations with effective cyber forces. Now there are more than 30. There are the “Seven Sisters” of cyber conflict - the US, Russia, China, Britain, Iran, Israel and North Korea - although nations from Vietnam to Mexico are getting involved. Many have started at home by testing their cyber capabilities against dissidents and political challengers. But no modern military can live without cyber capabilities, just as no nation could imagine, after 1918, living without airpower. And now, as then, it is impossible to imagine fully how dramatically this invention will alter the exercise of national power.

- David Sanger, National Security Correspondent, The New York Times, (Washington DC)

Prep!
-
Hack attack - hunting China's cyber warriors
- The age of cyberwar is here

 

 

Followed by a panel:

   

- David Sanger, National Security Correspondent, The New York Times, (Washington DC)

- Linda Jakobson, Founding Director & Chief Executive Officer, China Matters (Sydney)

- Tom Switzer, Executive Director, The Centre for Independent Studies (Sydney)

 

5.00pm-6.00pm:  Networking Drinks

 

6.00pm:  Strategies Conference 2018 ends

 

Strategies Conference 2018 closing credits

\
About Strategies Conference >