(Pictured: Lorraine Berends)
Marvin & Palmer Associates, the global equities manager, will close its Australian office at the end of September after 14 years. Lorraine Berends, who has headed the office since inception, said the closure was part of a firm-wide round of cost-cutting which reflected the shifting demands of institutional investors.
As a long-only growth manager, Marvin & Palmer has seen its assets under management gradually decline since the global financial crisis, as many funds moved to a passive core portfolio coupled with alpha-generating long/short and alternatives portfolios.
At its peak, in 2007, Marvin & Palmer had about $2 billion in Australian-sourced funds, which represented more than 15 per cent of its firm-wide assets. This subsequently fell to nil. However, just last year the firm launched an Asian-focussed long/short fund, which has not yet been marketed in Australia. That fund has about US$100 million under management.
Marvin & Palmer, based in Wilmington, Delaware, is well known to Australian investors having used third-party marketers, including Berends, in Australia prior to opening its own office.
Meanwhile, Berends, an active industry participant, has started a non-executive directorship at BT Financial Group on the responsible entity and approved trustee board which oversees seven underlying boards for various BTFG products. She is a former director and chair of ASFA, a director of IMCA and was a founding supporter of FEAL. She remains on the QSuper investment committee.
Berends said of the BT role that it was “good to be a part of the super industry again”, which she had not been as close to since she retired from the ASFA board in 2009. She is an actuary by training.
Berends said that the post-GFC aversion to volatility by funds was another issue for Marvin & Palmer, which had always sought above-average tracking error in its portfolios. This was addressed last year with a process which reduced volatility.
She hoped that Marvin & Palmer would return to Australia at some stage in the future.