AGEST -
Australian Government Employees Superannuation Trust
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Bernstein
AGEST and Bernstein AGEST has employed Bernstein to manage part of the international shares portfolio of the fund. Objective and Strategy
The Bernstein Global Value portfolio seeks a long-term premium of 3% before fees vs. the MSCI World (ex Australia) Index with Net Dividends reinvested.
*The MSCI World (ex-Australia) Index measures the performance of major sharemarkets around the world (other than Australia), with each sharemarket's performance contributing to the index in proportion to its relative size by market capitalization. Dividends paid by companies are included in this calculation of performance.
Strategy The primary source of Bernstein's performance premium for their Global Value service is research driven security selection. Their Investment Policy Group uses the research produced by Bernstein's over 50 company and quantitative analysts within a disciplined portfolio construction framework to develop a portfolio of 100-140 holdings with the desired risk / reward framework.
They begin with a broad universe of companies, and then screen this universe with a proprietary return model in order to identify the companies that have the most attractive value attributes. Their model derives an expected return for each company within the universe by assessing companies both from a global industry-based perspective and from a country-based standpoint. Inputs to the model include such factors as price to cash earnings, price to book, return on equity and price momentum. Finally, they aggregate the expected returns from both the industry and country perspectives so as to calculate a combined expected return and identify the most attractive investment opportunities.
Across all geographies, Bernstein's investment philosophy is value-based; they seek to buy the greatest amount of long-term earnings for the best price. Investors often overreact to near-term events, causing securities to become mispriced relative to their true values or long-term earnings prospects. They use their deep fundamental research capabilities to distinguish those companies that are undergoing temporary stress from those that deserve their depressed valuations, and look to exploit mispricings created by investor overreaction.
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