Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Steven Holden is the CEO and Founder of Copley Fund Research, an independent provider of research on equity fund positioning and performance.  Set up in 2014, Copley focuses on global, global emerging market, US, Asia Ex-Japan and China active equity funds, covering over $4tr in assets across 1300 active managers.  The company provides data and analysis on market trends, manager exposures and active fund performance to an audience of investment managers, pension funds and fund selectors worldwide.  Mr Holden’s 14-year investment banking career started in 2000, where he worked for Morgan Stanley as an equity derivative trader focused on emerging markets in London.  Following this, he spent 4 years at Citibank in London and Hong Kong as an Executive Director in derivative sales, focused again on emerging markets.

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Thematic (Sector/Industry)

Argentina Metals and mining / Thematic (Sector/Industry)

Exposure in Aluminium stocks has moved higher over the last 12-months.  Just over a fifth of the EM funds in our analysis now have exposure to the Aluminium industry group, up from 7.7% in June of last year.  However, at just 0.12% average weight, exposure levels are far from convincing.Ten stocks make up the Emerging Markets Aluminium Industry group, led by <a href="https://www.smartkarma.com/entities/china-hongqiao-group-ltd" target="_blank" data-smartkarma-citation="entities:1909:1" rel="noopener">China Hongqiao (1378 HK)</a> and <a href="https://www.smartkarma.com/entities/aluminum-corporation-of-china-limited" target="_blank" data-smartkarma-citation="entities:6884:1" rel="noopener">Aluminum Corporation Of China (2600 HK)</a>, held by 10.8% and 5.2% of managers respectively.The image of Aluminium from an ESG perspective doesn't appear to be a major issue and hasn't deterred the ESG focused strategies in our analysis from investing.  In fact, 26.3% of ESG funds have exposure to the Aluminium Industry compared to 19% of non-ESG funds.But we can't escape the fact that across all of the stocks in the Aluminium Industry group, not one has managed to attract an investment of above 2% in any of the 250 active GEM funds in our analysis.  At this stage, active EM managers are only 'dipping their toes in', rather than risking a high conviction allocation.

Exposure in Aluminium stocks has moved higher over the last 12-months.  Just over a fifth of the EM funds in our analysis now have exposure to the Aluminium industry group, up from 7.7% in June of last year.  However, at just 0.12% average weight, exposure levels are far from convincing.Ten stocks make up the Emerging Markets Aluminium Industry group, led by China Hongqiao (1378 HK) and Aluminum Corporation Of China (2600 HK), held by 10.8% and 5.2% of managers respectively.The image of Aluminium from an ESG perspective doesn't appear to be a major issue and hasn't deterred the ESG focused strategies in our analysis from investing.  In fact, 26.3% of ESG funds have exposure to the Aluminium Industry compared to 19% of non-ESG funds.But we can't escape the fact that across all of the stocks in the Aluminium Industry group, not one has managed to attract an investment of above 2% in any of the 250 active GEM funds in our analysis.  At this stage, active EM managers are only 'dipping their toes in', rather than risking a high conviction allocation.

EM Aluminium: Early Stage Move