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HE INVESTMENT OUTLOOK over the next few years looks pretty dismal compared with the double-digit returns investors have grown accustomed to over the last decade, so it is critical for asset owners and managers to have a crystal-clear understanding of their clients’ risk appetites. For the Queensland Government’s top investment adviser, Jim Christensen, that has meant spending countless hours over the last year, meeting with stakeholders and ensuring they, themselves, have a clear understanding of their own investment objectives, and how much risk they are prepared to take on in a bid to meet them. “Quite a few of our clients have been served pretty well by their strategy for some time, but the world is different and more challenging now,” Christensen says. “Getting absolute clarity around what a fund’s objectives are and marrying that with the strategy is very important, because if we’re not on the same page, then down the track there are going to be disagreements.” Christensen concedes it is a “strange conversation” to initiate. “Because returns over the past decade, the past five years in particular, have been very good, lots of funds with a moderate-to-high risk profile have delivered double-digit returns,” he explains. “But over the next five years, we think returns on these moderate-risk funds are going to be around half that, with a high single-digit return a pretty good outcome.” QIC began life in 1991 as the Queensland Investment Corporation, tasked with
investmentmagazine.com.au
APRIL 2018