National Employment Savings Trust (NEST) has granted two new emerging market mandates to HSBC Global Asset Management (UK) and Northern Trust Asset Management.
The funds will provide members with enhanced access to global growth opportunities as well as exposure to greater risks and returns.
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The two emerging market building block funds, which form part of Nest’s default Retirement Date Funds, include the HSBC Global Investment Funds (GIF) Economic Scale Index GEM Equity Fund and The Northern Trust Emerging Markets Custom ESG Equity Index Fund.
The funds will offer a superior risk return profile as well as a cost effective scalable solution.
HSBC fund will allot money to companies in developing markets based on their economic footprint besides offering investors with access to the exciting growth opportunities that exist in emerging markets.
The Northern Trust Emerging Markets Custom ESG Equity Index Fund will combine a norm and sector based screening, in addition to a governance filter for state-owned enterprises.
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By GlobalDataMark Fawcett, CIO at NEST, said: "These two new mandates represent an exciting development for NEST and as pure emerging market building blocks they allow us to further refine our approach to managing risk and delivering on our investment objectives by enhancing the global diversification of our portfolios.
"This is our first exposure to alternative indexing and reflects two of NEST’s investment beliefs that both indexed management, where available, is generally more efficient than active management and that integrating valuation considerations into the investment process can enhance our long-term performance," he added.
Stuart White, head of institutional UK at HSBC Global Asset Management said: "HSBC Global Asset Management is delighted that NEST has recognised the value of our proprietary emerging markets economic scale index and our expertise in passive management, having also awarded us a Shariah Global Equity Index mandate in 2011.
