First quarter 2008 was a nightmare for world share markets, as investor confidence was squeezed by sizeable bad debt writedowns by banks across the globe and mounting evidence that the US is headed for recession.
The MSCI World Index finished the quarter down 12.4% in AU$ terms, contributing to a minus 14.6% return for the year to 31 March.
Portfolio mix still global
Despite the gloom, Australian institutional and retail investors are continuing to include global shares in the portfolio mix. Phillip Grey, editorial and communications manager at Morningstar, says, “Most financial planners have had messages drummed into them about diversification and working through short-term periods of volatility.”
This is music to the ears of jumpy fund managers with a global bent, with one recruiter suggesting demand for their services remains strong.
Basic skills top the wish list
John Coles, CEO, Executive Group International, says, “There are three or four global banks and hedge funds looking for analysts who can adapt to overseas markets. However there’s not a big demand for people with overseas work experience. Rather it’s the basic skill set [employers] are looking for. Fund managers need to be able to pull apart balance sheets and do a lot of modelling.”
According to Coles, “Graduates will start on AU$80k, while someone with three to five years can earn around $150k with 30-50% bonuses. With six to eight years’ experience, they’ll get $200k plus 100% bonuses.”
Oliver Darkes, principal consultant at Carmichael Fisher, says Australian domiciled funds want people with international equities experience, and particularly those with Asian market knowledge. “But you don’t have to have lived over there,” he adds.