Brunel Pension Partnership, the £30 billion LGPS asset pool for the south-west of England, has launched its authorised contractual scheme (ACS) with its first sub-fund, for actively managed UK equities worth approximately £1.6 billion.
The active UK equity sub-fund will be managed by Aberdeen Standard Investments (ASI), Baillie Gifford and Invesco, with the ACS operated by FundRock. Brunel PP chief investment officer, Mark Mansley, commented: “Our rigorous quantitative investment analysis revealed that these managers present the blend of complementary skills and methods that will best serve this sub-fund. Invesco is a systematic manager with excellent risk controls. Baillie Gifford and ASI are more conventional active managers able to add value over the medium to long term, each through their own individual approach to stock selection.”
Mansley added that Brunel has reviewed the correlation between the managers to ensure that they provide genuine diversification, as well as looking at their approaches to stewardship and responsible investment. “We expect the portfolio to meet our 2% outperformance target with modest overall risk and low costs,” he added. Brunel carried out the manager searches with the help of Redington Investment Consultancy and with manager analysis provided by Inalytics for UK equities.