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RQI Investors has a dedicated team of portfolio managers and analysts responsible for the research, construction, portfolio management, trading and institutional sales and service of its underlying investment strategies.

Today, Realindex Investments, an active quantitative equities manager within the First Sentier Investors Group, will be known as RQI Investors. Coinciding with the investment manager’s 15-year anniversary, this name change is the first undertaken since RQI Investors was founded in 2008 and will be accompanied by a new logo and visual identity.

In these articles the quantitative investment manager RQI Investors highlights a range of topical issues in financial markets and quantitative investing.

RQI Investors’ quantitative value strategies have a long history of outperformance versus peers and value indices. Our disciplined, highly active, and repeatable value investing process provides investors with a benchmark unaware, diversified equity portfolio that is cost competitive versus fundamental active stock pickers.

Discover how our equity managers with one of Australia's longest track records provide capital and income growth by investing in the Australian share market.

The quantitative investing universe can be confusing - whether you might have been afraid to ask or yet to discover these terms, we’re here to help.

Diversified Alpha is a core systematic strategy designed to deliver consistent, risk-adjusted returns above the benchmark, with Environmental, Social and Governance (ESG) considerations embedded into the process.

It’s easy to follow the crowd into some of the world’s largest and most expensive companies. It’s much harder to invest with a contrarian focus on the metrics that really matter. Investing from a global universe of 15,000 stocks across Australian, Global and Emerging markets, Andrew Francis, Chief Executive of $32.2 billion investment firm RQI Investors, shares his learnings about the mistakes that weigh investors down in global markets and the unconventional yet telling data his team focus on.

From report writing and gathering information to the more technical side of pattern recognition and natural language processing, David Walsh, Head of Investment at RQI Investors recently joined Ausbiz to highlight how AI will affect wealth and investment management.

We examine the characteristics and trend of a well-known measure of quality - Profitability. Firstly, we discuss some of the reasons why it is a useful measure and why it might be persistent through time. It is a strong contributor to alpha, both on the long and short sides.

The debate over the importance of intangible assets continues, in academia and in the market. Parts of the investment community dispute the inclusion of intangible assets in a company’s asset base, claiming that the definition of intangibles is too restrictive or perhaps not restrictive enough.

We consider ESG risks to be factors that may place business value at risk. Companies at risk are identified using both external providers and our own internally driven research, which is based on a systematic and extensive company meeting program.

Systematic investor Joanna Nash discusses ways to reduce carbon emissions in portfolios.

First Sentier Investors, a leading global investment manager, today announces that it is setting its first nature targets as a Taskforce on Nature-related Financial Disclosures (TNFD) Adopter, in the lead up to the inaugural Global Nature Positive Summit hosted in Sydney this week.

Recent actions by China in Hong Kong and rising geopolitical tensions between China and the US have resulted in the US taking a range of actions including the enactment of the Holding Foreign Companies Accountable Act. One potential consequence of this Act is the forced delisting of Chinese American Depositary Receipts (ADRs) on US exchanges.

On the surface Value underperformed throughout 2020, but once we remove technology stocks like Tesla and Amazon from the equation, we can see that Value kept up with the broader market. Entering 2021, we are witnessing a strong rebound in Value. How should investors be approaching tech companies?

Global investment manager, First Sentier Investors, today announced changes to its investment capabilities within Australia.

First Sentier Investors, a leading global investment manager is pleased to announce the appointment of Adele Swan as the new Chief People and Culture Officer, effective 24 June. Ms Swan is based in Edinburgh, reporting to the CEO, Mark Steinberg.

“In some of our index focused strategies we can’t divest – so we need to let companies know which issues are important to shareholders.” Find out how investors can enact change from the top down with Realindex Portfolio Manager Joanna Nash.

The advent of Artificial Intelligence (AI) is affecting ever expanding fields of human activity. And the way we invest is no exception. It’s never been more timely for investors, advisors and investment managers to take deep stock of the impacts, real and potential, of AI, so we can better prepare to manage them – whether by leveraging opportunities, managing new risks or, more likely, both.

This article focuses on three of the PAIs related to Biodiversity Areas, Emissions to Water, and Hazardous and Radioactive Waste. Each PAI provides details about the measures, some of the challenges related to them, and how investors may use the information they provide.

First Sentier Investors is pleased to announce two key leadership appointments, effective 1 January 2025. Harry Moore is appointed to the newly created role of Chief Commercial Officer; and Lauren Prendiville is appointed as the new Global Head of Distribution and Marketing.

The Sustainable Finance Disclosure Regulation (SFDR) for the European Union Mandates the disclosure of the Principal Adverse Impacts (PAI) that investment decisions have on sustainability factors.

The Sustainable Finance Disclosure Regulation (SFDR) requires asset managers to report on up to 20 Principal Adverse Impact (PAI) indicators. PAIs are the negative impacts caused by a firm or an asset on the environment and society.

Most of us would have started 2021 with the hope that the worst of the COVID crisis was behind us, and some return to normality was just around the corner. We were quickly dislodged from this hopeful place with new variants of the pandemic virus emerging, ongoing lockdowns and travel restrictions, and vaccination resistance and protests. Nevertheless, the monetary response to the resulting economic downturn has been strong, benefiting all asset classes, especially equities. Here we take a look at how 2021 evolved. The review below is in three parts. Section 1 comments on markets and factors. Section 2 looks at some of the major themes of 2021, including ETF fund flows, ESG, YFYS (“Your Future Your Super”) and macro factors (primarily inflation and GDP growth and their expectations). Section 3 discusses how Realindex has evolved as a business during 2021, and drills down into attribution and performance of our portfolios.

We believe financial markets, critical to society’s ability to function, are under threat. For too long, it has been widely accepted that short-term performance, growth, risks and financial returns should be maximised at the expense of environmental and social outcomes.

New data reveals stronger correlations between female executive participation and company performance/returns. Investors could be overlooking gender diversity as a predictor of profitability and share market returns, a new study shows. While correlations between corporate female participation and better investor outcomes have been highlighted before, Realindex Investments’ new study, ‘Beyond lip service: tracking the impact of the gender diversity gap’, looks beyond the easy to find board-level diversity data and into executive team composition for a clearer link.

Better profit margins, higher return on equity and superior share market returns are hallmarks of listed companies with more diverse executive teams, new research shows.

Value investing reflects the long term mean reversion of stocks. That is, expensive stocks will on average decline or revert, and cheap stocks will rise or rebound. But why does this happen, and under what circumstances will this effect be greater or lesser?

People are are at the heart of our success as a leading global asset manager

Low-cost access to one of Australia's largest and longest-running geared share managers. Selecting quality stocks based on their fit for leverage, we favour essential characteristics like strong balance sheets, ability to grow cash flows through market environments and liquidity.

Conventional economic theory assumes individuals are perfectly rational in their decision making under uncertainty. This is usually known as expected utility theory. It is different to prospect theory, which represents more how people actually behave (“irrationally”?) rather than how they are expected to behave.

A 20-year dispute between US and Chinese regulators regarding the auditing of Chinese-domiciled but US-listed securities could soon be resolved. The Public Company Accounting Oversight Board (PCAOB) has recently signed a Statement of Protocol with the China Securities Regulatory Commission (CSRC) and the Ministry of Finance of the People’s Republic of China governing inspections and investigations of audit firms based in China and Hong Kong. This agreement establishes a specific, accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in China and Hong Kong, as required under US law. While this new agreement is an important step forward, it should be noted that the agreement itself does not satisfy the HFCAA. Compliance with the agreement is ultimately what matters and US regulators will be monitoring compliance. The news of an agreement has provided some relief to investors and is an important step forward in resolving this dispute after significant uncertainly.

From report writing and gathering information to the more technical side of pattern recognition and natural language processing, David Walsh, Head of Investment at RQI Investors recently joined Ausbiz to highlight how AI will affect wealth and investment management.

At Realindex, our ongoing research is moving strongly into the area of natural language processing (NLP), and how AI tools can be used to generate alpha.

On the 24th of February 2022, Russia invaded Ukraine. This has led to numerous sanctions being imposed upon the Russian regime by the international community. Sanctions are typically issued by governments targeting individuals, corporations or governments in order to force their compliance with laws, condemnation of actions or threats to peace. Sanctions usually take a diplomatic or economic form and aim to provide incentive for the target to change their course of action. Previous forms of sanctions include the US Government sanctioning Chinese military companies in response to perceived national security threats , and the European Union sanctioning individuals from Russia, Myanmar and Syria in response to terrorism and human rights infringements in those countries . The current round of Russian sanctions have primarily focused on damaging the Russian economy through asset freezes and restricting Russian access to the global banking system. The imposition of these sanctions have led to: • Restrictions on the financing of Russian projects and withdrawal of foreign capital • Increased costs of doing business in Russia due to the expulsion of several Russian banks from SWIFT, Mastercard and Visa payment networks • Numerous corporations withdrawing their business operations from Russia • Freezing of overseas assets owned by Russians • Restrictions on trade conducted with Russia • Halting of the Nord Stream 2 gas pipeline On top of government sanctions, we have also witnessed companies behaving proactively. For instance, Shell, ExxonMobil and BP have all announced their divestment and exit from all Russian oil and gas assets . Although existing sanctions have targeted a significant proportion of the Russian economy, they have largely avoided the energy sector due to Europe’s dependency on Russian supplies. There is still the possibility of future sanctions that target the oil and gas trade from Russia which would have a significant impact on global oil prices and a very direct effect on the Russian economy .

Diversity is a business issue as well as an ethical one. There is a raft of research demonstrating that gender diversity contributes to better business and economic outcomes.

We are entering a new era. The year 2024 will be unpredictable and clouded by many uncertainties. It will be marked by geopolitical risks, the ongoing taming of the inflation beast, and how the US Presidential election will impact markets.

Last quarter I visited infrastructure companies in Tokyo, Osaka and Nagoya. The trip included visits to ten corporate head offices and three site tours. This paper seeks to share some of the key findings from my meetings with Japanese passenger rail and utility companies.

Climate change and global warming pose systemic risks to society and the global economy. It impacts the availability of resources, the price and structure of the energy market, the vulnerability of infrastructure and the valuation of companies.

In September 2023, I met more than 30 global listed infrastructure companies and stakeholders from the UK, Europe and China. The following travel diary summarises my impressions and findings from these meetings.

Late in 2021 we published a Realinsights paper on the long term relationship between inflation and Value style investing. In that paper, we focused especially on whether the recent (and forecast) inflation spike we were seeing on the back of the COVID lockdown and stimulus packages would drive outperformance of Value in the near future. A lot has happened since then. Here we revisit some of our thoughts from that paper, and look at the more recent performance of Value in the face of (a) the Russia-Ukraine conflict, (b) high realised and anticipated inflation, and (c) the risk of a global recession.

There are four distinct ways to approach ESG investing in systematic investment strategies. Understanding the pros and cons of each can help to align client preferences. How investment managers and asset owners apply and implement their Environmental, Social and Governance thinking really matters to client outcomes.

Over the last decade the electricity sector has been at the forefront of decarbonisation, ahead of transport, industry and agriculture.

After decades of flat electricity demand for US utilities, the industry is now seeing unprecedented demand as growth in data centers / AI, electrification, onshoring and electric vehicles outweighs energy efficiency gains. One utility executive stated: “Seeing all these customers wanting 24/7 load and willing to pay for it – it is every utility’s dream”.

Global listed infrastructure underperformed in 2023 owing to rising interest rates and a shift away from defensive assets. Relative valuations are now at compelling levels. Infrastructure assets are expected to see earnings growth in 2024 and beyond, aided by structural growth drivers.

The impacts of interest rate changes on asset values are well understood by financial markets. Typically, for capital intensive assets such as real estate, the access and cost of capital are important contributors to future operating fundamentals.

Conventional wisdom suggests that value-style investments (‘Value’) outperform their growth-style (‘Growth’) counterparts during periods of higher inflation . But in a period of growing inflation and unprecedented conditions, we believe it is useful to test this assumption. This article outlines how Value investments have performed in 2021 and what might be in store for Value investors if inflation leads to higher interest rates.

The explosion of COVID-19 cases in early 2020 saw economic uncertainty hit the markets. Volatility spiked and equity markets fell sharply – the S&P/ASX200 almost halved in value over the 22 trading days from February 21st.

This final paper is somewhat shorter than the first two, and simply aims to look a little deeper into whether zombie firms appear in Realindex portfolios, and how a Quality factor acts as a repellent for these stocks. This is more important in Value-oriented portfolios as the potential appearance of lower quality “junk” firms, or even zombies, is higher here than in broader universes.