Standard Life Investments teams-up with Challenger in Australia for retirement income market

The fund will be distributed under Challenger’s brand and is designed to provide a positive absolute return over the mid to longer term in all market conditions with a steady stream of income.

The Challenger Absolute Return Global Bond Strategies Fund is being launched as the superannuation industry in Australia moves toward a greater focus on sustainable retirement incomes with innovative products to meet the needs of its ageing population.

Under the strategic partnership, SLI has been appointed investment manager and Challenger will have exclusive rights to distribute the Fund across the Australian retail channels.

SLI has a track record of building strategic global relationships however the move marks its first in Australia.

The firm said the partnership with Challenger presents “a great opportunity to work with a highly regarded, market leading company within the retirement income space”.

Standard Life Investments head of Australasia, Simone Bouch, said: “Strategic partnerships have played a key role in Standard Life Investments’ expansion and we have a strong track record of working with partners across the globe. Collaborating with the right strategic partner in Australia has always been something we have considered to accelerate our growth in the fourth largest pensions market in the world and to further cement our commitment to this market.

“There is a growing need from clients in Australia and globally for retirement-solutions that provide a solid income base combined with excellent risk management, particularly in this low-yield, low-return environment. We are very pleased to be partnering with Challenger who will now distribute the Fund through their highly regarded retail distribution network.

“The Absolute Return Global Bond Strategies (ARGBS) Fund has already been well received by institutional investors here in Australia. With over A$2 billion(£1.3bn) in assets-under-management in total and a strong performance track record behind it, we are confident that the strategy will attract a growing Australian retail investor base”.

Challenger chief Executive, distribution, product and marketing, Richard Howes, said: “Challenger is delighted to partner with Standard Life Investments to expand the range of products that are aimed at the retirement income market.

“Standard Life Investments is the pioneer in multi-asset, absolute return funds with A$96bn (£53bn) billion under management in the asset class. These products have an important role to play in retirement portfolios.”

The fund will be launched in April 2017, targeting an initial distribution of 2.5 per cent a year with distributions paid quarterly.