Australian defined contribution plan members will be getting more investment options in the future, according to a report from Buck Consultants.
Buck reported that 18% of 294 funds recently surveyed by the Association of Superannuation Funds of Australia now offer investment choice to at least some plan members; in addition, 20% of funds were considering introducing member investment choice.
What's more, the Senate Select Committee on Superannuation has recommended that member investment choice be mandatory, Buck reported.
However, the Buck report added the Australian government "does not support this recommendation."
Instead, government officials have said trustees should be allowed to decide for themselves whether to offer portfolio choices.
The Buck report says "a change of government (in Australia) is likely to lead to greater pressure (or even compulsion) to offer member investment choice."
LONDON - Morgan Grenfell Asset Management chief executive Keith Percy saw his empire grow 50% on New Year's Day.
On Jan. 1, the London-based unit of Deutsche Morgan Grenfell assumed responsibility for Deutsche Bank's two money management units.
Together, Deutsche Bank Asset Management and Deutsche Gesellschaft fur Fondsverwaltung MbH (better known as DEGEF) manage some 20 billion ($30 billion) in German stocks and bonds and global bonds.
The German division is overseen by Patrick Walker, Morgan Grenfell's marketing director.
That means MGAM now is responsible for investing some 60 billion in total assets in five divisions: besides the German division, there are units for the United Kingdom, the United States, the rest of the world and retail investors.
LONDON - Atlantis Investment Management will launch the Atlantis Japan Growth Fund, geared toward international institutional investors and U.K. retail investors.
The fund, which seeks to raise more than 100 million ($155 million), will be managed by Ed Merner, a well-known Japanese portfolio manager who recently left Schroder Investment Management's Japan operation in Tokyo.
NEW YORK - Morgan Stanley has introduced its "focus list" of Latin American stocks that the firm expects to outperform their respective market sectors over the next 12 months.
In Argentina, the firm's picks are Perez Companc and Telecom Argentina; in Brazil, the choices are Bradesco, Cia Vale do Rio Doce, Panamco and Usiminas; in Chile, CTC and Chilgener; in Colombia, Banco Ganadero Preferred; and in Mexico, APASCO and Femsa.
"On the whole, we are bullish on Latin America, particularly as institutional assets continue to find their way back," said Robert J. Pelosky Jr., Morgan Stanley's director of Latin America research and strategy.
LONDON - Pacific Basin stocks are ripe for recovery, according to Legal & General Investment Management. The London-based firm has boosted its investment in Pacific Basin equities to about 27% in its non-U.K. pooled funds, compared with 23% for the average U.K. money manager.
In a monthly newsletter, Legal & General strategy director David Shaw wrote the region is poised for a bull market. A three-year cyclical upswing in the region's short-term interest rates has peaked, he noted. In addition, Legal & General is expecting a regional recovery in corporate earnings, aided by the U.S. Federal Reserve's cut in the federal funds rate.
Mr. Shaw added Pacific Basin stocks are looking cheaper: they are 19% below their recent peaks based on the region's price-earnings ratio. In sterling terms, equity markets in the region have underperformed the Financial Times-Actuaries World Index (ex-U.K.) by 30% since their December 1993 peaks.
What's more, Mr. Shaw wrote U.S. mutual funds may resume their investment flows to the region, encouraged by further interest rate cuts and a desire to lock in 30%-plus returns from the U.S. stock market.
NEW YORK - Salomon Brothers lifted its recommended weighting to Argentina to 19% of a Latin American portfolio from 14%. At the same time, the firm trimmed its recommended allocation to Chile to 10% from 12%; Colombia, to 3% from 4%; and Mexico, to 20% from 21%.
In boosting its alllocation to Argentina, Salomon cited a "macropoltical and economic sitution" that is "on track for accelerating growth and a strong econmic reform process in 1996. At the same time, markets have fallen because of a combination of market uncertainty in the United States, a natural period of profit-taking after a strong run up in the Merval in December and January and disappointing first quarter (fiscal year 1996) results for some stocks, such as YPF and BAESA."
Salomon's favored stocks in Argentina include Galicia, Frances and Juan Minetti S.A.
SAN FRANCISCO - G.T. Capital Management has changed its name to LGT Asset Management, which is the asset management division of the newly formed Liechtenstein Global Trust.
Liechtenstein Global Trust replaces the BIL GT Group, which was the holding company for GT and the Bank in Liechtenstein.
Liechtenstein Global Trust consists of two operating divisions, the asset management division and the private banking division. Headquarters for North American institutional clients will continue to be in San Francisco, and the firm plans no changes in personnel.
The name change was made, officials said, to more accurately reflect the firm's ownership and corporate activities.
LONDON - Poland, South Korea, Israel, India, Brazil and Taiwan are Foreign & Colonial Emerging Markets Ltd.'s six favorite markets for 1996, said Arnab Banerji, chief investment officer of the London-based firm.
All the markets offer potential returns of 20% to 40% next year, he said.
Mr. Banerji said he believes emerging markets will be buoyed by a wave of liquidity that is flowing from the developed markets this year.
He said Poland's new government is committed to market reforms despite its communist heritage. Calling Poland the "tiger of Europe," he said the country offers 7% annual compounded growth rates and undervalued stocks.
South Korea will survive corruption scandals, and falling interest rates will cause domestic monies to shift into equities, Mr. Banerji said.
The economic growth rate may slip to 7% a year from 9%, but that is still very strong, Mr. Banerji added.
HONG KONG - Hong Kong pension funds averaged returns of about 16% in 1995, according to A. Grahame Stott, Asia Pacific regional director of Watson Wyatt Worldwide in Hong Kong.
That's up from -5% in 1994 but down from about 40% in 1993, according to Mr. Stott.
Although 1995's returns were "not brilliant," they did exceed salary inflation in Hong Kong, which is running at about 11%, said Mr. Stott.
