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Explaining MLC's investment approach


Deep experience. Market-leading investing.

For decades, our investment experts have been designing portfolios using a multi-manager approach, to help investors achieve their goals.

Our portfolios make sophisticated investing straightforward and there are a range of investment options to suit just about every investor.

Find out about the investment philosophy that guides how we manage your money, our investment process and the managers we use in our portfolios.

*As at 30 June 2023

How we invest.

There are four key aspects to our market-leading investment approach.

  • Our multi-asset portfolios focus on what affects investor outcomes the most: asset allocation. Each asset class has its own risk and return characteristics. We allocate money between asset classes based on the following beliefs:

    • Active management adds value
      People can often make financial decisions based on emotions and this may lead to situations where current market prices may not reflect the value of an asset to a long- term investor like us. In addition, in some markets deep research and analysis may reveal the ‘intrinsic value’ of an asset which has been overlooked by other investors.

      It’s these market inefficiencies that present opportunities for skilled active management to add value, delivering stronger long-term returns than would be possible by investing passively.

    • Skilful diversification delivers over the long-term
      Skilfully constructed multi-manager portfolios made up of a wide breadth of asset classes, many assets within asset classes, risks, investment styles, and investments across many geographies maximises the odds of achieving strong long-term returns while managing risk.

      Successful investing relies not just on strong performance in rising markets but also on preserving investors’ capital in hostile markets. The combination of skilful diversification and active management is one of the best ways of achieving these dual objectives.
    • Intelligent risk taking is a must
      It’s understood that some risks must be taken to achieve return objectives. However, not all risks are equal.

      Our role as active managers is to assess the range of possible market outcomes and position portfolios so that they maximise the chance of meeting clients’ return expectations while minimising exposure to risks unsupported by high conviction.
    • The long-term matters but we remain agile
      Deeply held investment convictions, sound judgments gained from navigating multiple market cycles, and structures and incentives that reward patience and perseverance, support our long-term focus.

      At the same time, we are very mindful of occasions when market events can, if overlooked, undermine returns. Our risk-aware investment approach alerts us to possible threats enabling us to position portfolios to weather such market conditions.
  • Our portfolios have different investment objectives. That's why our investment experts select a different mix of assets and investment managers for each.

    Our investment managers may be specialist in-house managers, external managers or a combination of both.

    We research hundreds of investment managers from around the world and select from the best for our portfolios.

    We then combine them in our portfolios so they complement each other.

    This multi-manager approach helps to reduce risk and deliver more consistent returns.

    Find out more about our current investment managers.

    View the current managers of a portfolio and their allocations using the Fund Profile Tool.

  • To make sure our portfolios are working hard for our investors, we continually review and actively manage them.

    We may adjust the asset allocation, investment strategies and managers. This may be because our assessment of the future market environment has altered or because we have found new ways to balance risk and return in the portfolios.

  • We deliver better returns by avoiding unnecessary costs. We do this by carefully managing cash flows, tax and changes in our portfolios.

Latest investment news and insights
Read about recent investment news and insights.

Derivatives policy
Derivatives are financial instruments such as options, futures and swaps. Generally, derivatives are used as part of a strategy to reduce risk or improve returns. The derivative policies for our product issuers outline how we manage derivatives.

Responsible Investing Policy

Environmental, social and governance (ESG) factors can influence investment outcomes and should be managed prudently.

Investment management decisions for the MLC investment options on our investment menus are made by our investment experts at MLC Asset Management Services Limited (MSL), and the investment managers they select.

MSL expects active investment managers to consider material effects any factors may have on investment returns, including ESG and ethical factors. MSL, primarily through its investment managers, may also engage with companies, providing an opportunity to enhance and protect the long-term value of investments.

We also believe voting on resolutions for the companies we invest in and actively engaging with companies provides an opportunity to enhance and protect the long-term value of clients’ portfolios.

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