June Investment Committee Meeting

A focus of our meeting this week was on the impact of rising interest rates in the USA. Historically there has been a reasonably strong link between interest rate increases and falls in financial markets. It doesn't happen everytime, but there is a strong correlation for it to warrant our attention. 

Another point that we addresssed was the performance of AQR. This is a manager that we have in the portfolio to ideally provide positive returns when markets are falling. Our concern has been that over recent times they have been suffering losses and we want to understand why, how likely the losses are to continue and whether the fund will still deliver in falling markets. The process started with Bart Dowling and Gary Lucas meeting with AQR and we then called upon the specialist for this area from Lonsec, our fund researcher. This gave us strong depth of research and analysis from a number of sources. Overall whilst there are still some concerns, we are sufficiently satisfied that AQR remains a high quality manager and has the ability to deliver when we need them. We will continue to monitor them closely as we do with all the managers we engage.