Former Future fund PM joins TCorp

Nigel Wilkin-Smith, the long-standing executive at the Future Fund, has landed at TCorp as a senior portfolio manager - portfolio construction.

Wilkin-Smith spent 11 years at Australia's sovereign wealth fund, most recently as a director of portfolio construction.

Before that, he did a four-month stint at Ardea Investment Management and earlier was head of the strategic research unit at van Eyk Research.

Wilkin-Smith is a proponent of the total portfolio approach (TPA) to investment, as is his new boss, Stewart Brentnall.

The TCorp investment chief has long argued that strategic asset allocation has major structural problems.

With this investment style, funds do not operate with a fixed strategic asset allocation and they avoid silos across asset classes.

The entire focus of TPA is on achieving the fund's investment goal rather than on a particular strategic asset allocation.

To Brentnall, TPA is the model of optimality and alignment.

Conversely, he calls strategic asset allocation (SAA) the model of convenience and measurability.

The TCorp investment chief echoes the sentiments of NZ Super's chief investment officer Stephen Gilmore who believes that TPA is even more valuable in the current market environment.

"It makes an awful lot of sense to think about the whole portfolio in an environment where almost all assets will be hit by skyrocketing interest rates, especially when risk premia are rising," he said last week.

Gilmore spent nine years at the Future Fund - most recently as chief investment strategist - before joining Guardians of New Zealand Superannuation three and a half years ago.