❓ A member of parliament questions the Insurance Commission of Western Australia's investment of $140 million in hedge funds, inquiring about the selection process, risk assessment, and ministerial approval. The parliamentary secretary provides answers on behalf of the responsible minister.
AnsweredQoN 1085Legislative Council
QuestionView source ↗
INSURANCE COMMISSION OF WESTERN AUSTRALIA
I refer the minister to the allocation of $140 million by the Insurance Commission of Western Australia to three hedge funds. (1) Were other hedge funds considered; and, if so, which ones? (2) How were the three funds selected and by whom? (3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY
I refer the minister to the allocation of $140 million by the Insurance Commission of Western Australia to three hedge funds. (1) Were other hedge funds considered; and, if so, which ones? (2) How were the three funds selected and by whom? (3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY
AnswerView source ↗
On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(1) Were other hedge funds considered; and, if so, which ones? (2) How were the three funds selected and by whom? (3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(2) How were the three funds selected and by whom? (3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(1) Were other hedge funds considered; and, if so, which ones? (2) How were the three funds selected and by whom? (3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(2) How were the three funds selected and by whom? (3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(3) Will the minister table the documents presented to the board of management recommending the three funds; and, if not, why not? (4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(4) Why did the commission place such substantial amounts in higher risk hedge funds, particularly given significant investment returns? (5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(5) Was the minister required to approve the hedge funds allocation? Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
Hon SUE ELLERY replied: On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
On behalf of the parliamentary secretary representing the Minister for Government Enterprises, I provide the following answer. (1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(1) Yes. Bridgewater All Weather Fund. (2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(2) The Insurance Commission of Western Australia’s investment consultant, JANA Investment Advisers put forward a short list of possible hedge funds for the Insurance Commission’s consideration. After interviewing each manager, the Insurance Commission’s board of commissioners then made the selection, ensuring that the manager’s investment style provided greater diversity to the Insurance Commission’s strategic asset allocation. (3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(3) Yes. (4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(4) The Insurance Commission of Western Australia decided to invest in hedge funds as part of its allocation to alternative assets, with the aim of reducing both overall volatility within the portfolio and the risk of experiencing a negative return. These funds have an absolute return focus and are expected to perform strongly in periods when other asset classes experience negative returns. (5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
(5) No, however, given the nature of these investments, on this occasion the board of commissioners sought the Treasurer’s approval to invest in these specific trusts.
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