Capital Allocators – Inside the Institutional Investment Industry [REPLAY] Raphael Arndt – Australia's Sovereign Wealth Fund CIO (Capital Allocators, Episode 70)
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Feb 9, 2026 Raphael Arndt, CIO of Australia’s Future Fund and former engineer turned infrastructure investor. He discusses building a one-team, one-portfolio approach. Short-term nimbleness vs long-term optionality. How the Fund separates beta, factors and true skill across public and private markets. Designing co-investments, venture exposure and fee structures to pay only for real value.
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Construct Portfolios By Factor Exposures
- Map assets by factor exposures (equity risk premium, inflation, duration, illiquidity) and run forward-looking scenario analysis.
- Use that to choose assets that behave complementarily across stagflation, recession, and productivity scenarios.
Disaggregate Beta, Factors, And Skill
- Aggregated manager bets often cancel out, leaving investors with beta minus fees unless you design the total portfolio deliberately.
- Disaggregate beta, factors, and true skill to avoid overpaying for returns you could buy cheaply.
Assess Private Equity By PME And Skill
- In private equity, remove leverage and timing effects via public market equivalent (PME) and focus on managers who add operational value.
- Avoid large buyout strategies that are effectively levered equities after fees.