WEEKEND PROFESSIONAL

THE LATESTTERTIARY SECTOR NEWS AND CAREERSHigher Education every Wednesday

to book an ad call 1300 307 287

30 BUSINESS FUND MANAGERS SURVEY THE WEEKEND AUSTRALIAN, JANUARY 7-8, 2012www.theaustralian.com.au/business

Careers with Queensland Health

A criminal history check may be conducted on the recommended person for the job.A non-smoking policy applies to Queensland Government buildings, offi ces and motor vehicles.

You can apply online atwww.health.qld.gov.au/workforus

BlazeQ019440

Professor and Senior Staff SpecialistMedical Oncology, Division of Cancer Services, Princess Alexandra Hospital,Metro South Health Service District

The Princess Alexandra Hospital (PAH; www.health.qld.gov.au/pahospital/) is a major tertiary referral hospital for cancer services in South East Queensland, and a teaching hospital of the School of Medicine of the University of Queensland (www.uq.edu.au). The University of Queensland Diamantina Institute (UQDI) is a translational research institute of the University of Queensland, closely affiliated with Princess Alexandra Hospital. It employs over 150 scientists and clinician scientists and has a research focus on cancer and immunological disorders. The main areas of strength in cancer research are skin cancers (melanoma and SCC) and haematological malignancies. The UQDI will be moving into the Translational Research Institute (TRI) due for completion in Q3 2012, and collocated on the PAH campus. This is a new state-of-the-art biomedical translational research institute which will house up to 700 translational research scientists and provide enormous opportunity to hasten medical discovery.Medical Oncology services at the PAH are delivered from within the Division of Cancer Services. There is a strong clinical research interest focusing on adult malignancies which includes a wide range of national and international clinical trials. There is particular emphasis on disease of local significance such as melanoma and there is referral base for tumour of the adolescent and young adult. The Director of Medical Oncology, Assoc. Prof. Damien Thomson, aims to foster internal and external research collaborations across the hospital and research communities. He leads a team of 10 medical oncologists, including 1 other at Assoc. Professor Level. The Cancer Collaborative Group (CCQ) at PAH has been focused on the collaborations between clinical researchers in all streams with the laboratory research units on site. Active multidisciplinary tumour groups operate across all adult malignancies except gynaecology. The Medical Oncology service is supported by subspecialty Cancer Surgery and a large Radiation Oncology department supporting 9 linear accelerators over 2 sites. Within Medical Oncology, most research has been within the clinical realm and the aim of this new position is to develop and lead a translation research program in medical oncology with UQDI.This will enhance education and higher degree opportunities for UQ MBBS students and post specialty training candidates.Applications are sought from established clinician researchers in the field of medical oncology, with a laboratory research focus on an aspect of adult malignancies, for a newly created professorial position based at the Princess Alexandra Hospital in conjunction with the University of Queensland Diamantina Institute in Brisbane, Australia. The split between clinician and researcher is 50% for each component.A competitive salary and start up infrastructure support will provide the opportunity to build a competitive translational research program in collaboration with existing teams in the setting of a major cancer treatment centre focused on disease entities within the blood cancer spectrum andmay include epidemiology, genetics, cell biology, immunology, diagnostics, biomarkers and treatment strategies. Details of the research interests of the UQDI may be accessed on the Institute’s web site athttp://www.di.uq.edu.au.Details of the PAH cancer services and CCG can be accessed at:http://paweb.sth.health.qld.gov.au/cancer/default.asphttp://www.health.qld.gov.au/pahospital/research/ccg_default.aspDetails of the Translational Research Institute can be accessed at: http://www.tri.edu.au/Remuneration value up to $389 164 p.a., comprising salary between $176 377 - $187 000 p.a. employer contribution to superannuation (up to 12.75%) and annual leave loading (17.5%), private use of a fully maintained vehicle, communications package, professional development allowance, professional development leave 3.6 weeks p.a., professional indemnity cover, private practice arrangements plus overtime and on-call allowances. Advancement to eminent or pre eminent specialist level based on individual application as well relocation package. A research start up package will be negotiated with the successful applicant (L25–L27)(Applications remain current for 12 months)Enquiries: Assoc. Prof. Damien ThomsonContact: (07) 3176 2272Job Ad Reference: H11PA12269Application Kit: (07) 3136 5616 or (07) 3121 1411or www.health.qld.gov.au/workforusClosing Date: Monday, 30 January 2012.

www.usc.edu.au/jobs

New Facilities Management OpportunitiesApplications close: 5pm, Monday 23 January 2012

• Deputy Director and Planning Manager, Facilities Management The Deputy Director and Planning Manager will be responsible for leading effective and sustainable use of the University’s physical assets. This includes responsibility for strategic facilities planning, campus space management, capital development, and the management of Planning staff.

• Operations Manager, Facilities Management The Operations Manager will be responsible for the efficient, effective and continual improvement of operational risk management and compliance, sustainable services for building and infrastructure maintenance, grounds maintenance, security, cleaning, utilities, parking, procurement, counter disaster planning and emergency control.

Applications from female candidates are encouraged.

For the full position description, selection criteria and details on how to apply, visit our website www.usc.edu.au/jobs or email jobs@usc.edu.au.

If you require further information, please contact:

Mark BradleyDirector, Facilities ManagementTel: 07 5430 1120Email: mbradley@usc.edu.au

Kelly O’Dwyer MPFederal Member for Higgins

CONSTITUENT MANAGERApplications are invited for the above position based in Malvern.

The duties of the position include: reception, responding to constituent enquiries, liaising with Government departments and other organisations, preparing and coordinating correspondence, database management and some research.

Applicants should possess the following skills and experience:

• An understanding of Australia’s system of government and parliamentary processes

• Excellent oral and written communication skills• Well developed office IT skills• Good organisational ability• Ability to work as part of a team

A commencing salary between $43,942 and $51,352 will be paid and an optional allowance in lieu of overtime will be considered for applicants with significant experience. Opportunity to travel to Canberra will apply for the right candidate.

A probationary period of three months will apply.

Applications setting out details of experience and the names of two referees should be forwarded to kathryn.segrave@aph.gov.au.

Applications close on 18 January 2011.For further information please contact Kathryn Segrave on (03) 9822 4422.

AG57909

Well placed to ride out the global stormAmid the eurozone crisis and a slowdown inChina, Australia appears a safe haven

ANDREW MAIN

PAUL CUDDYBennelong Australia Equity Partners

ERIK METANOMSKILanyon Asset Management

ANDREW WESTRegal Funds Management

IF fund managers are by nature acautious bunch, 2011 gave themmuch to be cautious about andtheir outlook on 2012 reflects thatroller-coaster experience. TheWeekend Australian surveyedseven leading managers and allagree the eurozone crisis will notbe resolved any time soon andmost believe that the China boomwill slow slightly in 2012, takingthe top off commodity prices. Butthey see Australia as being wellplaced generally and, while theydo not see our market taking off onthe upside any time soon, they’renot giving up on it either.

DO you see the eurozone crisishaving less of an impact in 2012than it has had in 2011?

Martin Conlon, head of Austra-lian equities at Schroder Invest-ment Management Australia:

Despite investor desires forshort-term solutions, eurozoneissues are structural, long-termanddifficult to resolve,andwillnotdisappear in 2012. Without bond-holders beginning to acknowledgelosses rather than expecting tax-payers and/or equity holders tobail them out, sustainable solu-tions are likely to remain elusive.The impact of these issues on mar-ket sentiment is more difficult todetermine, as much of this diresituation and the lack of appetitefor structural change is already re-flected in both depressed econom-ies and stockmarket valuations.

Paul Cuddy, CEO of BennelongAustralia Equity Partners:

The European debt crisis hashad a significant impact on ourmarket with the majority of thepain suffered in the September2011 quarter. This correspondedwith the European Union at-tempting to navigate its waythrough a combination of risingyields on government debt,changes in leadership of stressedmember countries and disagree-ment about rescue packages andrescue conditions. The Europeancrisis, like the GFC before it, willhave lasting effects. The differenceis that the GFC related to corpor-ate debt while the European crisis

relates to sovereign debt, which isfar more transparent. Regardlessof the nature of the debtor, the factis that we are facing some kind ofcredit crunch. This will ultimatelyimpact economic activity andequity markets. We are optimisticthat the European leaders will ag-ree on a rescue package andunequivocally guarantee the sov-ereign debt of member countriesbut it will take time. When this isachieved it will be positive forequity markets. Until then, we willbe faced witha dangerouscombin-ation of more uncertainty, higherfunding costs, tighter credit con-trols and lower confidence.

Matt Sherwood, head ofinvestment markets research,Perpetual Investments:

Events in Europe have sappedmarket confidence, as evidencedby 20 major markets all beingdown in 2011 despite earnings pershare rising in 17 of them. TheEuropean crisis is not solely basedaround the debt of nations. It alsoinvolves weak growth across theregion, the need to tighten policy,a very fragile banking sector, rat-ings downgrades and the end of anear-30-year leverageboominthehousehold sector. As eurozonepoliticians disagreed on how toaddress the crisis, the Europeaneconomy already seems to be fall-ing into recession, with more pro-nounced deleveraging ahead.

The latest round of ‘‘reforms’’seemed to focus more on prevent-ing a future crisis than solving thecurrent one. Indeed, even if the en-tire package was implemented inevery country tomorrow, nothingwill be done to increase growth,lower unemployment or improvethe debt position of struggling Eu-ropean governments. We are in amulti-year deleveraging cyclewith multi-year sub-trend growththe consequence. Investorsshouldn’t expect a quick fix, andshould remain wary of any marketrally (following any announce-ment) representing a cure-all.Given the size of the problem, thisis a confidence game more thananything else and the Europeanauthorities have been unable tocomprehensivelyaddress the issue

and stem the momentum of thecrisis despite numerous summitsand conferences. The solutionneeded is a political one and thereis little doubt that 2012’s outcomesare likely to be dominated by Eu-ropean developments, tighteningcredit conditions globally, wide-spread ratings downgrades andquestions about the speed and sus-tainability of the global recovery.

Andrew West, portfolio managerat Regal Funds Management:

The situation in the eurozonehas deteriorated over the course of2011 which suggests that the crisisis likely to continue to have a largeimpact on markets in the comingyear. Of greatest concern are po-tential event risks that exist, suchas the uncertain impact a break-upof the eurozone might have. Untilcentral banks and politicians canpersuade investors that enoughhas been done to alleviate theserisks it appears that markets willremain volatile. Various initiativeshave been proposed but we are notyet at the point where these havebeen turned into tangible action,and political differences in par-ticular continue to impede prog-ress. This suggests that any resol-ution of the crisis is more likely tobe delayed until later in the year.

Noel Murphy, fixed interestportfolio manager at PerennialInvestment Partners:

I think the eurozone will re-main a key focus for financial mar-kets for much of 2012.

When you consider the politi-cal realities of getting the pro-posed fiscal reforms enshrined inlegislation, the process will inevi-tably beslow andarduous. Noneofus should be surprised that therewill be good days and bad, andtherefore volatility is here to stay.For those of us looking for goodnews out of the recent develop-ments, at least the Europeans arefacing up to their fiscal problems.That’s obviously the first and mostimportant step along the road to amore stable economic environ-ment. For the pessimistic, there islittle doubt that if the Europeansare serious about paying downdebt and strengthening theirbanking system, the whole Euro-pean region is destined for a dec-ade of anaemic growth at best.

Winston Sammut, founder andCEO of REIT specialist MaximAsset Management:

Over the latter part of 2011 in-

vestors have seen markets tradingup and down on each and everymorsel of news either relating to oremanating from Europe. At thesame time little or no attention hasbeen paid to any of the positiveeconomic indicators coming outof the US or to the ongoing growthoccurring in Asia. In 2012 we ex-pect to see continued negotiationsbetween the stronger EMU mem-bers (e.g. Germany & France) andits weaker members (Greece, Italyetc) as they substitute additionalfunding in return for more reform/restraint. Under this scenario, it isimportant the EMU remain com-mitted to getting agreement on re-form, so it will need to keep alivethe prospect of an EMU break-upas none of the parties involvedwant this to occur. We thereforeexpect governments as well ascentral banks to work together toavoid the Armageddon scenario.That should lead to an environ-ment where the eurozone crisiswill have less of an impact over thecourse of 2012 in financial marketswith a corresponding reduction involatility compared with 2011.

Erik Metanomski, founder ofLanyon Asset Management:

Well, we certainly cannot en-visage a set of circumstanceswhereby there will be anyquickfire solution or silver bullet.Even an increasing number of Eu-ropean leaders are begrudginglyaccepting that the enormity andcomplexity of issues being facedwill require many years of sacrificeand well below par economic per-formance before they are resolved.Basically, the proverbial can hasnow been kicked down the road somany times that it now resemblesa 44 gallon drum with a few sticksof gelignite in it. The unconscion-able propensity of central banks,politicians,andbankers to focusalltheir energies on the symptoms asopposed to dealing with the deepunderlying structural distortionsand chasms in our current-dayfinancial system should be causefor the most grave concern.

WILL the world’s developingmarkets, particularly in Asia,play an increasing role in sup-porting Australia’s economy in2012 or will China fall away?

Martin Conlon, Schroders:Australia’s economy is already

supported by artificially highterms of trade and the supply/de-mand imbalance in commodity

markets driven by exceptionallyhigh Chinese growth rates over anextended period. Although fore-casting an end to these conditionsis fraught with danger, we have lit-tle doubt that the risks to Chinesegrowth spurred by massive expan-sions in credit and constructionactivity in recent years are firmlynegative. Cycles exist in all econ-omies, and the increased confi-dence in the future which ema-nates from an extended period ofstrength is illogical. Whilst thiswould obviously be less supportivefor resource companies, we be-lieve a broader and more balancedbase for the economy will be farhealthier.

Paul Cuddy, Bennelong:Developed markets dominated

global economic growth up until2000. Since then the developingeconomies have dominated interms of contribution to globalGDP growth and this trend is ex-pected to continue, which is posi-tive for Australia.

We remain positive on the out-

look for Chinese economic growthand the impact it will have on partsof Australia’s economy. Chinesepolicymakers have recently beenfocused on managing inflationand have been concerned aboutspeculative property investment.More recently, Chinese manufac-turing and inflation data hasslowed. This could be a precursorto a more positive outlook forChina as authorities can pull regu-latory, monetary or fiscal levers tostimulate the economy if requiredin 2012.

Matt Sherwood, Perpetual:Over the past 20 years Austra-

lia has successfully transitioned itseconomy away from the US andBritain and towards Asia. In 2012,Asia is likely to remain the fastest-growing region as its economiescontinue to industrialise andurbanise. Nevertheless, there is aclear slowing in Asian trade and itmight be the case that Chinesegrowth temporarily drops below8 per cent in early 2012. However,policymakers have already started

to ease policy (by lowering theirreserves requirement), which canbe supported by additional fiscalspending programs, lower interestrates, a potential exchange ratedepreciation and the spending ofsome of their $US3 trillion offoreign exchange reserves. TheChinese have four conventionalpolicy tools to support growth,whereas the US and Europe havenone. Importantly, the low-debtnature of Asian household andgovernment balance sheets (ex-cluding India) means that policystimulus can be successfully de-ployed to generate higher spend-ing and support economic growth(unlike in the US and Europe).

This means that, in the absenceof any severe financial shock,China’s and Asia’s growth pros-pects should progressively im-prove in 2012, which will benefitcommodity producers such asAustralia, Canada and SouthAfrica. The key risks to China, andhence Australia, come fromEurope where a deeper and moreprolonged recession could tem-

porarily overwhelm China’s abil-ity to stimulate growth. In this en-vironment the RBA will have toinitiate larger cuts to domestic in-terest rates to support the dom-estic outlook as the exchange rateremains stubbornly high.

Andrew West, Regal:The Chinese influence on Aus-

tralia will remain a key driver in2012. China has leadership and aplan, which is more than can besaid for many other countries, andprovides some confidence in con-tinued growth in Asia and Austra-lia. That said, Chinese growth isslowing but this has been engin-eered through tighter lending tohelp rebalance the economy andreduce inflation. This appears tobe working. Property sales andnew loans are now down year onyear — which has some bears call-ing for a hard landing — but con-sumerretail sales continue togrowat a healthy 17 per cent per annum.In other words, the source ofChinese growth is gradually shift-ing as intended from fixed asset

F

THE LATESTTERTIARY SECTOR NEWS AND CAREERSHigher Education every Wednesday

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FUND MANAGERS SURVEY BUSINESS 31THE WEEKEND AUSTRALIAN, JANUARY 7-8, 2012www.theaustralian.com.au/business

The Australian Government welcomes applications from the diverse Australian community including Aboriginal and Torres Strait Islander people and people with disability, people of all ages and those from culturally and linguistically diverse backgrounds.

AUSTRALIAN GOVERNMENT

CAREERS

Department of Defence

Defence Support Group Various locations

Area Manager – Social WorkerExecutive Level 1 – $88,019 - $99,285 plus superPosition number: DSG/06080/11Closing Date: 19 January 2012

for further information please visit www.defence.gov.au/apscareers

National Health and Medical Research Council

Research Translation Group, Canberra

DirectorExecutive Level 2 – $105,380 - $124,766Position Number: New PositionContact Officer: Professor John McCallum (02) 6217 9030

Closing Date: 16 January 2012

For further information please visit www.nhmrc.gov.au

AG57914

Director Terrestrial BiodiversityDEPARTMENT OF NATURAL RESOURCES, ENVIRONMENT, THE ARTS AND SPORT

Senior Professional 1 Remuneration Package Range $110 503 - $123 305 (Comprising salary $96 560 - $107 872, superannuation, leave loading and the value of 2 weeks extra recreation leave)

Biodiversity Conservation, Berrimah

Permanent

This position will play a major role in the conservation of biodiversity in the Northern Territory through a broad range of policy, research, management and community engagement activities.

The position requires a dynamic and motivated person who can provide strong research leadership but who also has a commitment to promoting community involvement in conservation and the translation of research into on-ground management. In addition to relevant experience in conservation research and biodiversity monitoring, applicants should demonstrate strong communication skills, and be able to develop and maintain partnerships with a diverse range of stakeholders, including indigenous land managers.

Over the next few years, this position will have a key role in the NERP North Australia Hub, as well as maximising biodiversity co-benefit from the emerging carbon economy.

The Biodiversity Conservation Division has a strong background in biodiversity research and management, and maintains collaborative links with many research agencies and land management organisations. The Division’s responsibilities include provision of advice about biodiversity matters within government and externally, biodiversity monitoring and inventory survey, the management of threatened species, the sustainable use of wildlife, regional conservation planning, assessing the biodiversity impacts of development proposals, collaborative biodiversity research and management with Indigenous groups and maintenance and analysis of Territory-wide biodiversity data sets.

Further enquiries about the position can be directed to Alaric Fisher, Executive Director Biodiversity Conservation, on 0478404546.

Please refer to the contact details below for a copy of the Job Description and Selection Criteria.

Contact us on 1300 659 247 or email recruitmentjobvacancies@nt.gov.au

Quote vacancy number: 9910Closing date: 27 January 2012

www.nt.gov.au/jobs • 1300 659 247The Northern Territory Government is an equal opportunity

employer and values an inclusive and diverse workforce.

careers in government

Independent Senator for South Australia

Senator Nick Xenophon

Senior Media and Policy AdviserApplications are invited for the above position based in Adelaide.

This position plays a key role in the development and implementation of policies and communication strategies. It would suit a highly motivated person, preferably with experience in journalism or a related communications discipline.

The duties of the position include: analysing Government and non-Government policy and developing policy responses, preparing media releases and liaising with journalists, writing speeches and meeting with stakeholders to discuss policy issues. Interstate travel will be required.

Applicants should possess the following skills and experience:• An understanding of Australia’s system of government and parliamentary

processes• An interest in public policy• Excellent oral and written communication skills• Ability to assess issues quickly and efficiently• Good organisational ability• Ability to work independently, as well as part of a team

A combined commencing salary and allowance in lieu of overtime between $94,624 and $108,361 will be paid, depending on skills and experience. A probationary period of 3 months will apply.

Applications setting out details of experience and the names of two referees should be forwarded to: senator.xenophon@aph.gov.au

Applications close on Monday 16 January 2012. For further information please contact 08 8232 1144.

AG57734

– but don’t expect a market lift-offMARTIN CONLONSchroder Investment Management Australia

MATT SHERWOODPerpetual Investments

NOEL MURPHYPerennial Investment Partners

WINSTON SAMMUTMaxim Asset Management

‘In this environment, an exodus of foreigncapital at some stage is almost inevitable’MARTIN CONLONSCHRODERS

investment to consumption. Themain question is whether this pro-cess can occur smoothly. We be-lieve confidence can be rebuilt in2012 when new fiscal measures arelikely to be accommodated thatput at least a temporary floorunder property and constructionmarkets, giving more time for arebalance to occur.

Noel Murphy, Perennial:Asia already plays a significant

role in supporting the Australianeconomy. When you consider thatour four largest trading partnersare China, Japan,South Korea andIndia, our economic prosperity isinextricably linked to the region.When you then consider that ourmain exports to these countriesare things like iron ore, coal andincreasingly in the future LNG,these are all basic building blocksfor the region’s unquestionedgrowth. We can at the margin de-bate thepricesatwhich thesecom-modities may trade, but the in-creasing volumes that will berequired in the decades to comeare beyond dispute. We expectChina to have a couple of quartersof lower growth, but as theChinese demonstrated during theGFC, when called upon they haveplenty of firepower in both fiscaland monetary policy terms tostimulate domestic activity.

Winston Sammut, Maxim:Growth in the Asian region has

been the stabilising factor in anotherwise messy global economicenvironment and Australia hasbeen a major benefactor of thatgrowth. While much has been saidabout the likely slowdown ofChina’s exports to Europe and tothe US, the demand for Australiancoal and iron ore will continue tobe strong as urbanisation con-tinues to unfold in China. Demand

for our raw materials has out-strippedsupply, resulting inhigherprices. We are likely to see asoftening in commodity pricesuntil such time as Western econ-omies improve. However, pricesare likely to settle at levels that willstill provide sound returns forAustralia’s mining sector.

Erik Metanomski, Lanyon:You cannot divorce Asia or

China itself from the realities ofwhat is happening in its majormarkets. China relies on Europeand the US to take about 60 percent of its total exports. To believethat demand from these two cen-tres is not going to come under in-creasing pressure for the immedi-ate future would suggest acomplete lack of understanding asto where we are in the debt cycle,the increasing scarcity of credit,the intensedeleveragingcycle thatis still in its infancy, and the com-mensurate impact upon levels ofdemand for what Asia produces aswell as for commodities generally.

To believe that Australia will beinsulated from such harsh realitiesis myopic in the extreme.

WHAT will be the big influencesonthedollarandwill theychangethe Australian investment land-scape for local and overseas in-vestors?

Martin Conlon, Schroders:The confluence of factors sup-

porting the Australian dollar overrecent years has been extraordin-ary. Relatively low levels of gov-ernment debt, a commoditiesboom, high interest rates relativeto almost all global markets anddisastrous economic conditions inmost major economies have con-tributed to the Aussie being wellabove levels that we see as justifi-able. Longer-term indicators such

as purchasing power parity woulddictate materially lower levels. Inthis environment, an exodus offoreign capital at some stage is al-most inevitable. This will alter thelandscape and shift the earningsbase of many companies (both upand down) to far more sustainablelevels.

Paul Cuddy, Bennelong:The big drivers of the dollar in

the past 12 monthshave been com-modities and interest rates. It willprobably soften as commodityprices ease and the RBA continuesto cut rates. But our dollar will stillbe supported by Australia’s AAAcredit rating, which will supportdemand for bonds. Also, a greatdeal of offshore capital is still fund-ing investment in a myriad ofmining-related capital projects.

Matt Sherwood, Perpetual:The resilience of the dollar

amid the broad-based derisking ofglobal portfolios was the most sur-prising development of 2011. Eventhough Asian growth has slowednotably, commodity prices aredown about 12 per cent and theRBA has begun to lower interestrates, the currency has barelymoved since August and remainsclose to parity. Indeed, the currentlevel of commodity prices andAsian growth would normally beassociated with an US85c-US90cdollar. It may be that Australia hasmanaged its economy a little toowell, and that global investors in-creasingly see Australian dollarassets as a safe haven. Ten-yearbond yields have declined to apost-war low of 3.8 per cent, sup-porting this view.

Clearly, global and Asian inves-tors are factoring a structurallystronger domestic economic pro-file into exchange rates, in light ofAustralia’s persistent trade surplus

and growing Asian trade ex-posure, modest net governmentdebt and higher return on equity.The higher currency has, in turn,hurt the price performance ofAustralian-listed companies withforeign earnings. However, lowercommodity prices and interestrate differentials suggest the bal-ance of risks for the currency is tothe downside. This would improvethe earnings outlook for a raft ofindustrial and resource stocks andbe a welcome development forrisk-weary investors.

Andrew West, Regal:As has been the case for three

years, thebiggest influencesonthedollar are likely to be events off-shore, so expect continued vola-tility. We don’t make currencyforecasts, preferring to hedgeaway many common factor risks.The resilience of the dollar in theface of the global growth slow-down has been a surprise. Inves-tors can’t simply assume the dollarwill revert quickly to past levels,but instead need to understandtheir portfolios under both risingand falling dollar scenarios.

Noel Murphy, Perennial:With growth in China likely to

slow a little in the first half of 2012and the US economy continuingto show encouraging signs of im-proving further, theAussie is likelyto weaken against the greenbackin the first half of the year. If thisunfolds over time it should notgreatly affect the investment land-scape, though it would give tour-ism and manufacturing a break.

Winston Sammut, Maxim:Continued demand for our

commodities should keep the dol-lar in the US95c-$US1.20 rangeover 2012. Fluctuations will occuras Europe continues to dominate

the news. In Australia, the cashrate should fall to between 3.5 percentand4per cent, but the interestrate differential will continue tomake this attractive to US inves-tors, providing some support forthe dollar.

Erik Metanomski, Lanyon:The Aussie is still widely seen as

a commodity-based currency andour increasingly lop-sided econ-omy reflects and supports thatview. In an increasingly credit anddemand-constrained world,downward pressure on com-modity prices is likely to intensify.This, plus the downward bias of in-terest rates and a resultant re-duction in the favourable interestrate differentials, may put signifi-cant pressure on the dollar.

WHICH sectors in the localinvestment universe do you seefaring better and/or best in 2012?

Martin Conlon, Schroders:We believe the best opportunit-

ies lie in stocks with significantglobal exposure and an earningsbase artificially depressed by cur-rency levels and subdued econ-omic activity. Strong global indus-trial franchises such as JamesHardie, Brambles and News Cor-poration are most favoured. Ourcore scenario remains an ex-tended period of global deleverag-ing, so we are more optimistic oncompanies even though condi-tions will not quickly rebound.

Paul Cuddy, Bennelong:We like companies able to de-

liver positive earnings surprisesand try to avoid those at risk of de-livering poor earnings.

We have already seen signs ofearnings risk in the discretionaryretailers, steel, tourism and mediasectors. Companies that cannotdifferentiate or have elements ofcyclical or structural risk will con-tinue to face headwinds. On theother hand, there are those withstrong business models that candeliver growth that is relatively re-silient to short-term macroecono-mic fluctuations. Sectors that fitthis criterion include healthcare,mining services and parts of trans-portation.

Matt Sherwood, Perpetual:The best-performing assets in

2011 were government bonds andprecious metals. But this year’swinning investment strategiesmay have lower returns in 2012,given their historically high valu-ations. Volatility is likely to behigher and asset markets could bemore highly correlated than nor-mal. The group of companies thattypically outperform in this sort ofenvironment are the ‘‘quality’’ones. Companies with a strongbalance sheet, consistent cashflowgeneration and reliable earningsgrowth tend to outperform intimes of heightened uncertainty.Investing in low-risk, quality as-sets and regular portfoliorebalancing (when securities havebeen oversold or overbought) willhelp mitigate risk. The key is toseek exposure to quality income-producing assets undervalued bythe market. There is much lessvolatility in dividend income thanin share prices.

Andrew West, Regal:We see the best growth in sec-

tors most exposed to business in-vestment. Australia’s Q3 GDPnumbers showed a 31 per cent liftin engineering constructiondriven by major resource projects.Continuation of large committedprojects is likely. Macroeconomicuncertainty is unlikely to derailproject commitments, makingmining services exposures attract-ive. But this is a late-stage cycle, sostock selection is paramount.Earningscertainty is thekey, sowefocus on where order books aregrowing and if macroeconomicheadwinds resolve themselves wewould expect a P/E re-rating onthese names.

Noel Murphy, Perennial:After five years of disappoint-

ing returns on local and interna-tional shares, it’s time for a turn.It’s not that we see a significant im-provement in either the domesticor international economic land-scape, but more a slow dissipationof the ‘‘tail risk’’ priced into mostasset classes in 2011.

Winston Sammut, Maxim:A conservative approach to in-

vestment exposures is warrantedfor 2012. Lower growth meansthere will be a greater focus onyield/income. On that basis wefavour the banking sector, whichprovides attractive, fully frankeddividends, telecommunications(read Telstra) and an A-REIT sec-tor that has finally got back tobasics. The A-REITs have loweredgearing levels to amoreacceptable25-30 per cent and their expectedgradual increase in distributionswill make them more attractive asthe cash rate falls.

Erik Metanomski, Lanyon:We try to find companies large-

ly immune to a credit and com-modity cycle that is expected tobecome increasingly hostile. As aresult, our fund has a zero ex-posure to banks and the majorcommodity-based companies.

The risk premium that we cur-rently require in order to invest inan equity is a function of our cur-rent perceived evaluation of theprevailing risks. Given our pre-vious comments it would be ap-parent that we are currently de-manding above-average riskpremiums before parting with ourinvestors’ hard-earned savings.Other factors that are critical to usare; the quality of management,the consistency of free cashflow,strength of balance sheets, and thedefensiveness of income streams.

DO you see the S&P/ASX 200 in-dex breaking through 5000?

Martin Conlon, Schroders:No. In the environment of

deleveraging thatwe envisage, sig-nificant positive returns are un-likely. Although investors remainrelatively focused on absolute out-comes, the important factor in in-

vestment is the maintenance ofpurchasing power. As interestrates globally plummet in an effortto stall the deleveraging process,equities should eventually benefitfrom relatively attractive cashflowyields. However, expecting strongdouble digit returns is optimistic.

Paul Cuddy, Bennelong:We are optimistic that 2012 will

be a more positive year for dom-estic equities relative to 2011. Butthe 5000 level will probably provea tough ask in the next 12 months.

Current valuations are weigheddown by concerns about Europe,China and the challenges of weakconfidence, currency and risingcosts. While we do expect to seemore companies downgrade earn-ings and review their capital pos-itions, we see some attractive op-portunities that offer good yieldand earnings growth. If we see acombination of European stab-ility, Chinese stimulus, continuedimprovement in the US, moreRBA rate cuts and improving con-fidence, then the market will havea very positive 2012.

Matt Sherwood, Perpetual:Some local investors may be

comforted to know that our AllOrdinaries Index, which declinedin 2011, has not produced two con-secutive negative calendar yeartotal returns since 1982. Other in-vestors might feel reassured thatearnings are still growing, valu-ations are cheap, commodityprices seem less stretched, dom-estic interest rates are decliningand the Australian dollar has de-preciated from its peak. Despitethese very strong foundations, theAustralian sharemarket is highlyunlikely to make a serious play at5000 until Europe is resolved andChinese growth begins to trendupwards. Inflation remains low,credit growth is around a 50-yeartrough and bond yields are neartheir lowest level since World WarII. These combined factors suggestthat any market rise is likely to bemore grinding than spectacular,but a lot has to go right before anyrise is sustainable. Until then, themarket is likely to remain largelyrange-bound with no clear trend.

This is why income and conserva-tive investing is so important.

Andrew West, Regal:Everyone we speak to is bearish

and sitting in cash, which is under-standable. However,we view5000as justifiable based on forecastearnings and consequently anindex level that can be achievedprovided certain conditions aremet. The key requirement is thatfinancial conditions in Europecease to get worse and concertedaction materialises to draw a linein the sand. We’d watch for a re-duction in yields in the region asthe main indicator of this risk eas-ing. The second is that Chineseproperty prices and constructionactivity show stability, probablyassisted by limited monetary eas-ing and government stimulus suchas social housing. Take currentheadwinds away by mid-2012 andwe believe investor confidencecould return, allowing the index tosurpass 5000 by year’s end. But wedo expect 2012 to be a volatile rideand as a long/short investor wewield two swords, irrespective ofmarket direction.

Noel Murphy, Perennial:I doubt we will see the index

sustainably push through 5000 inthe year ahead, but when opti-mism does return, it is often sur-prising how quickly the marketcan price in a brighter future.

Winston Sammut, Maxim:Adopting a starting level of

about 4200 for the S&P/ASX 200Index implies a return of 20 percent should the index reach the5000 level. This is considered to bea very big ask. Notwithstandingany rectification of Europe’s prob-lems and while we are likely to seean improving US economy, it ap-pears that debt reduction has beenand will continue to be the mainfocus of not only governments butbusiness enterprises as well as in-dividuals. Accordingly, we expecta long period of slower growth thatwill translate to lower expec-tations for investment returns. Weexpect the market to trade in arange of 3850 to 4500 over 2012,implying a total return of about 10per cent at best, after allowing fordividends.

Erik Metanomski, Lanyon:We never really think about

index levels as we are index agnos-tic, preferring instead to focuspurely upon the companies.

Good Shepherd Lutheran College NT is a rapidly growing T-12 school, seeking teachers for its Palmerston and Howard Springs Campuses.

Middle School:Teachers of English, HumanitiesOr a combination of the above

Both experienced educators and graduates with current Teacher Registration are encouraged to apply.

Applications must include a CV, introductory letter and contact details for at least three referees.

Please forward your application by Monday 16th January to:

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Ph 8983 0300 admin@goodshepherd.nt.edu.auwww.goodshepherd.nt.edu.au

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