Kurt Head of Research and Portfolio Construction, IPIF

Kurt Lemke, Head of Research and Portfolio Construction

Hi Kurt, what’s your elevator speech?

I’m Head of Research & Portfolio Construction for IPIF. I joined in early 2020 after nearly a decade working with large institutional investors. Basically, I research unlisted infrastructure transactions with an eye to managing risk for investors.

 

What sparked your interest in unlisted investments?

Early on, I witnessed the capital struggles and economic cycles of listed investments and decided it wasn’t for me. With unlisted, the fundamental principles – cash flows and risks to those cash flows – are the central drivers of performance. I like that clarity.

 

What about infrastructure. How did you come to focus on that?

Several years ago, as an economic forecaster for BIS Shrapnel, I was tasked with providing forecasts for the Port Botany/Kembla privatisation. That experience, seeing behind the curtain, was amazing. From then on, I was hooked. I developed forecasts and valuations for roughly 50 privatisations or secondary transactions in the following years.

 

IPIF serves smaller investors. What interests you about that?

Large institutions tend to make decisions subjectively. At IPIF, we’re able to offer a more objective, quantitative view. Using high-quality data, objective insights, and keen analyses, we get a better view of potential risk-and-return behaviour through various economic cycles.

 

What do you mean by subjectively? Can you elaborate?

Sure. Large institutions are heavily focused on historical analyses, that’s basic intuition for most financial industry veterans. When it comes to unlisted infrastructure equity, forecasted cash flows are incredibly important too. That’s a key difference.

 

So, if we asked what your business philosophy is, you’d say…?

Forecasting! You can’t just look backward. You’ve got to get good at seeing what’s around the next corner, what might happen that’s never happened before.

 

What does your portfolio management experience look like?

Prior to IPIF, I was led the Quantitative Insight Program & Portfolio Construction for Hastings Funds Management. In that role, I was responsible for both the Utilities Trust of Australia and The Infrastructure Fund, which added up to about $8 billion in unlisted infrastructure equity.

 

A former colleague calls you one of the “brightest minds in the financial industry.” Care to comment?

Hah. Big institutional investors like to keep things opaque, but the data are there for all of us to see. All we have to do is look. When it comes to making sound investments, you can’t just follow their lead. At IPIF, we invest like the big guys, but we do it strategically; we’re more diversified on multiple levels.

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