State Street Global Advisors Launches Global Alpha Plus Strategy; Offers Institutional Investors an Innovative and Efficient App
October 05 2005 - 9:23AM
Business Wire
State Street Global Advisors (SSgA), the investment management arm
of State Street Corporation (NYSE:STT) and the largest
institutional fund manager in the world, today announced the launch
of its new Global Alpha Plus Strategy, designed to provide
institutional investors with more efficient active returns in
global equity markets. The new strategy has been lead-designed by
the local quantitative investment team at SSgA in Australia, in
conjunction with the firm's pioneering global Advanced Research
Center. Global Alpha Plus builds on the key tenets of SSgA's
Australian Alpha Plus Strategy, utilising a consistent quantitative
ranking and selection process to evaluate stocks on a global basis,
and enabling up to 30 percent short positions to achieve higher
expected returns. The Australian Alpha Plus Strategy was launched
in January 2005 and has quickly filled to capacity. Global Alpha
Plus aims to fill a gap in the market for higher-risk,
higher-return international equities products, while maintaining a
highly efficient risk/return trade-off. Efficiency is maximized by
the loosening of long-only constraints, which allows the manager to
take underweight as well as overweight positions - (the freedom to
pick 'losers' and 'winners'). Lochiel Crafter, chief investment
officer of State Street Global Advisors, Asia Pacific, said
institutional investors around the globe have strong interest in
innovative strategies that give managers far greater opportunity to
add value. "Big investors, focused on achieving more alpha in their
portfolios, are loosening risk constraints and introducing elements
such as shorting. Investors need to be comfortable, however, that
the strategies are achieving alpha efficiently at low levels of
risk," said Crafter. "By applying a disciplined, well researched
and proven process operating across a broad universe of stocks, we
aim to provide our customers with this comfort level and to achieve
consistent value-added performance." Global Alpha Plus will invest
across a well-diversified portfolio of approximately 300 stocks and
maintain a neutral bias to style, capitalization, industry and
region. The strategy will take active risk of approximately 4-5
percent per year, and include the ability to take short positions
up to 30 percent, with market exposure maintained at 100 percent.
The strategy will be managed against the MSCI World Total Return
Index(SM) and will aim to outperform its benchmark by 4-5 percent
per year over rolling three-year periods. The strategy does not
include active currency management. The new strategy adds to SSgA's
already extensive range of global equities strategies, which span
the risk/return spectrum. These include, in increasing risk/return
order, a passive strategy, Enhanced Global Index Plus, Active
Long-Only Global Alpha, the new Global Alpha Plus, and the Global
Long-Short Strategy. SSgA has US$1.4 trillion in total worldwide
assets under management, with global equities under management
accounting for US$23.8 billion (as of June 30, 2005). SSgA delivers
investment strategies and integrated solutions to clients worldwide
across every asset class, investment approach and style. SSgA has
investment centers in Boston, Hong Kong, London, Milan, Montreal,
Munich, Paris, Singapore, Sydney, Tokyo, and Zurich, and offices in
28 cities worldwide. For more information, visit State Street
Global Advisors at www.ssga.com. State Street Corporation (NYSE:
STT) is the world's leading specialist in providing institutional
investors with investment servicing, investment management and
investment research and trading. With US$9.6 trillion in assets
under custody and US$1.4 trillion in assets under management as of
June 30, 2005, State Street operates in 25 countries and more than
100 geographic markets worldwide. For more information, visit State
Street's Web site at www.statestreet.com.
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