Realindex Investments, a subsidiary of Colonial First State (CFS), has won about $300 million in mandates from institutional investors.
While Realindex Investments chief executive Andrew Francis would not reveal any names, he said a corporate superannuation fund invested $190 million and two industry funds had invested about $50 million each into Realindex.
The business, which was established in October 2008 as the result of a strategic alliance between CFS and Research Affiliates of California, this week announced it had reached more than $1 billion in funds under management.
"We've found that institutional and retail clients and their advisers are really looking for a different approach to traditional cap-weighted index funds because they understand that markets are not efficient and weighting a portfolio by price may cause a performance drag," Francis said.
He said there were further opportunities to expand the business. Realindex Investments recently appointed Peter Bull as portfolio manager/analyst and the business would be looking to add another soon.
"Realindex has had an excellent start to the business, both in terms of client support through fund flow and the underlying performance, with all we manage significantly ahead of the market capitalisation indexes since the inception of our portfolios in mid-November last year," he said.
