The move from Viridian and CFS to provide personal advice in a scaled manner highlights a growing willingness within the industry to fix its own problems in lieu of waiting for the government.
Private markets are worth around $14 trillion globally, ASIC believes. It’s not sure, and that uncertainty hints at the wider problem – private markets, and their effect on public ones, is still largely a mystery.
Competition hots up among ratings firms
Managed funds research and ratings start-up Foresight Analytics is expanding further in the ultra-competitive retail and advised investment sector through the acquisition of the analytics business of Australia Ratings Group.
This follows a tie-up announced earlier this month with Style Analytics Group, a factor analysis firm with offices in Boston and London, which provides research and services on managed funds, exchange-traded funds (ETFs), separately managed accounts (SMAs) and indices.
Australia Ratings Analytics (ARA) services will come under the Foresight brand following the purchase. Foresight Analytics’ process blends fundamental and forensic research for asset allocation, investment selection and risk management.
ARA research and ratings cover wholesale and retail managed funds, SMAs and exchange-traded products. The deal will add to Foresight’s market share and scale, complementary to the Style Analytics offering.
Jay Kumar, Foresight director and founder, said his firm was challenging the incumbency of existing investment ratings providers by offering a “more competitive and sophisticated service”. He said both ARA and Foresight had the same mission, to “serve clients by simplifying the challenges associated with investment decisions”.
Kumar spent five years as a research analyst at Morningstar, before joining ING as a portfolio manager and then institutional research manager at ANZ, before launching Foresight in 2015.
There would be an expanded asset-class coverage across equities, bonds, real assets and alternatives, as well as diligence ratings on private and public market investment opportunities.
Foresight sets itself apart from its major competitors by not selling investment products, nor charging asset-based fees for research and consulting.
Its biggest competitors are Morningstar, Zenith Partners and Lonsec, while another recent start-up, Evergreen Consultants, has also been encroaching on the established players’ territory, since it was founded by Angela Ashton in late 2016.
