BLF invites bids for $1.5bn EM equity mandate
November 20, 2018
Taiwan’s Bureau of Labor Funds is inviting bids for a five-year, quasi-passive emerging markets equity mandate of $1.5 billion to be split equally between five asset managers.
The NT$3.94 trillion ($127 billion) state pension manager – a keen user of factor-based, or so-called smart beta, investing – announced the invitation on Monday. It did so on behalf of the NT$2.14 trillion Labor Pension Fund, the largest of the six funds that the BLF manages to meet Taiwan’s retirement and labour compensation needs.
Asset managers have to prove that they can earn an annual return that is 50 basis points more than the annual net return of the iEdge Rayliant EM Dynamic Multi-Factor Index specified by the institution.
The index is customised and its constituent equity securities are ex-Taiwan, unhedged and measured in US dollars.
It is a total return index, which assumes that any cash distributions from the stocks, such as dividends, are reinvested back into the index. And the securities in the index will be weighted by a series of factors including low volatility, high quality and high dividend.