NEWS
Performance Report: The Airlie Australian Share Fund
4 Jan 2021 - Australian Fund Monitors
The Airlie Australian Share Fund rose +10.22% in November, taking 12-month performance to +4.67% vs the ASX200 Accumulation Index's -1.98%. Since inception in June 2018, the Fund has returned +8.95% p.a. vs the Index's +7.19%. These...
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4 Jan 2021 - Performance Report: The Airlie Australian Share Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is long-only with a bottom-up focus. It has a concentrated portfolio of 15-35 stocks (target 25). Maximum cash holding of 10% with an aim to be fully invested. Airlie employs a prudent investment approach that identifies companies based on their financial strength, attractive durable business characteristics and the quality of their management teams. Airlie invests in these companies when their view of their fair value exceeds the prevailing market price. It is jointly managed by Matt Williams and Emma Fisher. Matt has over 25 years' investment experience and formerly held the role of Head of Equities and Portfolio Manager at Perpetual Investments. Emma has over 8 years' investment experience and has previously worked as an investment analyst within the Australian equities team at Fidelity International and, prior to that, at Nomura Securities. |
| Manager Comments | At month-end, the portfolio's top positions included Aurizon Holdings, BHP Group, CBA, CSL, Macquarie Group, Mineral Resources, Origin Energy, Pacific Current Group, Wesfarmers and Westpac Banking Corporation. By sector, the portfolio was most heavily weighted towards the Financials and Consumer Discretionary sectors. |
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Performance Report: Bennelong Emerging Companies Fund
4 Jan 2021 - Australian Fund Monitors
The Bennelong Emerging Companies Fund rose +6.87% in November, taking 12-month performance to +8.54% vs the ASX200 Accumulation Index's -1.98%. Since inception in November 2017, the Fund has returned +28.85% p.a. vs the Index's +7.31%.
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4 Jan 2021 - Performance Report: Bennelong Emerging Companies Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund may invest in securities expected to be listed on the ASX within 12 months. The Fund may also invest in securities listed, or expected to be listed, on other exchanged where such securities relate to ASX-listed securities |
| Manager Comments | True to the Fund's investment style, Bennelong continue to seek to invest in high quality companies that they believe have solid growth prospects over the foreseeable future. They noted that, despite the inevitable ups and downs of the market in the short term, they believe the portfolio's investments are all incrementally building value which they expect will ultimately underpin decent returns over the long-term. The portfolio remains reasonably diversified across sector and risk-return drivers. Bennelong believe it is currently well positioned for attractive returns over the long-term, regardless of the market's short-term activity. |
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Performance Report: Delft Partners Global High Conviction
4 Jan 2021 - Australian Fund Monitors
The Delft Partners Global High Conviction Strategy rose +8.69% in November, outperforming AFM's Global Equity Index by +1.17% and taking performance since inception in August 2011 to +14.93% p.a. with an annualised volatility of 11.84%.
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4 Jan 2021 - Performance Report: Delft Partners Global High Conviction
By: Australian Fund Monitors
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| Fund Overview | The quantitative model is proprietary and designed in-house. The critical elements are Valuation, Momentum, and Quality (VMQ) and every stock in the global universe is scored and ranked. Verification of the quant model scores is then cross checked by fundamental analysis in which a company's Accounting policies, Governance, and Strategic positioning is evaluated. The manager believes strategy is suited to investors seeking returns from investing in global companies, diversification away from Australia and a risk aware approach to global investing. It should be noted that this is a strategy in an IMA format and is not offered as a fund. An IMA solution can be a more cost and tax effective solution, for clients who wish to own fewer stocks in a long only strategy. |
| Manager Comments | The Strategy has achieved an average positive monthly return since inception of +3.28% vs the Index's +3.01%. The Strategy's Sharpe and Sortino ratios for performance since inception are 1.07 and 1.95 respectively. With respect to the Index's 10 best and worst months since the Strategy's inception, the Strategy has outperformed in 9 out of 10 of the Index's best months and 7 out of 10 of the Index's worst months. This highlights the Strategy's capacity to outperform in both rising and falling markets. |
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Performance Report: Montgomery Small Companies Fund
18 Dec 2020 - Australian Fund Monitors
The Montgomery Small Companies Fund rose +6.12% in November, taking 12-month performance to +21.11% vs the ASX200 Accumulation Index's -1.98%. Since inception in October 2019, the Fund has returned +18.06% p.a. vs the Index's +0.75%.
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18 Dec 2020 - Performance Report: Montgomery Small Companies Fund
By: Australian Fund Monitors
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| Fund Overview | Montgomery Lucent, a joint venture between Lucent Capital Partners and Montgomery Investment Management, is the investment manager of the Fund. Lucent Capital Partners is owned by its founders Gary Rollo and Dominic Rose. Gary and Dominic have worked together for three years as at February 2020 and have a combined three decades of portfolio management and equities research experience. The manager is able to invest up to 10% of the portfolio in pre-IPO opportunities. They search for companies likely to benefit from secular trends, industry change and with substantial competitive advantages. Cash typically ranges around 10%. |
| Manager Comments | The largest positive contributors for November included Corporate Travel Management, NRW Holdings and Webjet. Montgomery noted the arrival of better than expected vaccine news drove a strong surge in COVID-19 impacted stocks, such as CTD and WEB in the travel sector, supporting an earnings recovery scenario as travel barriers are removed and demand returns over the foreseeable future. The largest detractors included Adairs, Marley Spoon and Bapcor. All three had been COVID-19 winners and as such became sources of profits over the month as the market rotated towards economic reopening stories. |
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Performance Report: Insync Global Capital Aware Fund
18 Dec 2020 - Australian Fund Monitors
The Insync Global Capital Aware Fund rose +2.62% in November, taking 12-month performance to +19.06% vs AFM's Global Equity Index's +6.02%. Since inception in October 2009, the Fund has returned +12.04% p.a. with an annualised volatility of 9.90%.
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18 Dec 2020 - Performance Report: Insync Global Capital Aware Fund
By: Australian Fund Monitors
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| Fund Overview | Insync employs four simple screens to narrow the universe of over 40,000 listed companies globally to a focus group of high quality companies that it believes have the potential to consistently grow their profits and dividends. These screens are size of the company, balance sheet performance, valuation and dividend quality. Companies that pass this due diligence process are then valued using dividend discount models, free cash flow yield and proprietary implied growth and expected return models. The end result is a high conviction portfolio of typically 15-30 stocks. The principal investments will be in shares of companies listed on international stock exchanges (including the US, Europe and Asia). The Fund may also hold cash, derivatives (for example futures, options and swaps), currency contracts, American Depository Receipts and Global Depository Receipts. The Fund may also invest in various types of international pooled investment vehicles. At times, Insync may consider holding higher levels of cash if valuations are full and it is difficult to find attractive investment opportunities. When Insync believes markets to be overvalued, it may hold part of its resources in cash, or use derivatives as a way of reducing its equity exposure. Insync may use options, futures and other derivatives to reduce risk or gain exposure to underlying physical investments. The Fund may purchase put options on market indices or specific stocks to hedge against losses caused by declines in the prices of stocks in its portfolio. |
| Manager Comments | The Fund's capacity to protect investors' capital in falling and volatile markets is highlighted by the following statistics (since inception): Sortino ratio of 1.80 vs the Index's 1.36, maximum drawdown of -10.98% vs the Index's -13.59%, and down-capture ratio of 61.7%. Insync noted the Fund's underperformance vs the Index's +7.52% in November was due to the very strong 'risk-on' rally which impacted the Fund's short-term results. The Fund's top holdings at month-end included Dollar General, Nintendo, Qualcomm, Domino's Pizza, PayPal, Facebook, Visa, S&P Global, Nvidia and Microsoft. The portfolio was significantly overweight the IT sector and underweight the Industrials and Financials sectors. |
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Performance Report: NWQ Fiduciary Fund
18 Dec 2020 - Australian Fund Monitors
The NWQ Fiduciary Fund has returned +6.16% with a volatility of 9.97% over the past 12 months vs the ASX200 Accumulation Index's return of -1.98% with a volatility of 27.34%. Since inception in May 2013, the Fund has returned +5.61% p.a....
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18 Dec 2020 - Performance Report: NWQ Fiduciary Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund aims to produce returns after management fees and expenses of RBA Cash Rate + 4.0-5.0% p.a. over rolling five-year periods. Furthermore, the Fund aims to achieve these returns with volatility that is a fraction of the Australian equity market, in order to smooth returns for investors. |
| Manager Comments | The Fund's capacity protect investors' capital in falling and volatile markets is highlighted by the following statistics (since inception): Sortino ratio of 1.03 vs the Index's 0.54, maximum drawdown of -8.77% vs the Index's -26.75%, and down-capture ratio of 13.25%. The Fund's underlying managers prioritise fundamentals and generally invest in cash generative businesses that have a runway for sustainably growing earnings (and short businesses with the opposite characteristics). NWQ noted this approach has the potential to generate sustainable long-term returns but can be susceptible to short-term rotations away from high-quality or growth businesses and into low-quality or deep value businesses, as occurred in November. NWQ added that these rotations are typically temporary (lasting between 1-3 months) and are generally followed by periods of strong performance for the Fund, as was seen in 2013 and 2017. |
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Performance Report: Paragon Australian Long Short Fund
18 Dec 2020 - Australian Fund Monitors
The Paragon Australian Long Short Fund rose +1.16% in November, taking 12-month performance to +16.59% vs the ASX200 Accumulation Index's -1.98%. Since inception in March 2013, the Fund has returned +10.82% p.a. vs the Index's +7.62%.
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18 Dec 2020 - Performance Report: Paragon Australian Long Short Fund
By: Australian Fund Monitors
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| Fund Overview | Paragon's unique investment style, comprising thematic led idea generation followed with an in depth research effort, results in a concentrated portfolio of high conviction stocks. Conviction in bottom up analysis drives the investment case and ultimate position sizing: * Both quantitative analysis - probability weighted high/low/base case valuations - and qualitative analysis - company meetings, assessing management, the business model, balance sheet strength and likely direction of returns - collectively form Paragon's overall view for each investment case. * Paragon will then allocate weighting to each investment opportunity based on a risk/reward profile, capped to defined investment parameters by market cap, which are continually monitored as part of Paragon's overall risk management framework. The objective of the Paragon Fund is to produce absolute returns in excess of 10% p.a. over a 3-5 year time horizon with a low correlation to the Australian equities market. |
| Manager Comments | Positive contributors in November included Pilbara, Chalice and PolyNovo, offset by declines in the Fund's gold and technology holdings. Paragon noted market rotations are hard to time and in any case are temporary in nature. Their outlook remains constructive. Copper hit 7yr highs and Brent Oil rose +27% during the month, both of which were great tailwinds for Paragon's base metals and oil stock picks. The Fund ended the month with 32 long positions and 5 short positions. |
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Performance Report: Quay Global Real Estate Fund
18 Dec 2020 - Australian Fund Monitors
The Quay Global Real Estate Fund rose +6.54% in November, taking performance since inception in January 2016 to +6.40% p.a. with an annualised volatility of 11.93%.
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18 Dec 2020 - Performance Report: Quay Global Real Estate Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund will invest in a number of global listed real estate companies, groups or funds. The investment strategy is to make investments in real estate securities at a price that will deliver a real, after inflation, total return of 5% per annum (before costs and fees), inclusive of distributions over a longer-term period. The Investment Strategy is indifferent to the constraints of any index benchmarks and is relatively concentrated in its number of investments. The Fund is expected to own between 20 and 40 securities, and from time to time up to 20% of the portfolio maybe invested in cash. The Fund is $A un-hedged. |
| Manager Comments | Winners for the month included Brixmor Property Group (US Retail), Scentre Group (Australian Retail), and Hysan (Hong Kong Diversified). Conversely, stocks that performed well during the lockdown dragged on performance in November; CubeSmart (US Self Storage), STAG Industrial (US Industrial) and Safestore (UK Self Storage). Quay noted they are bullish on global real estate based on attractive valuations and have remained fully invested for several months now. The portfolio can be broadly characterised as being split 50/50 between the 'stay at home trade' (Industrial, Storage, Data Storage, Affordable Residential) and 're-open trade' (Retail, Healthcare, Office, Coastal Apartments). |
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Performance Report: Ark Global Fund - Class B AUD Hedged
17 Dec 2020 - Australian Fund Monitors
The Ark Global Fund - Class B AUD (Hedged) rose +0.61% in November, taking performance since inception in July 2017 to +6.27% p.a. with an annualised volatility of 9.13%.
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17 Dec 2020 - Performance Report: Ark Global Fund - Class B AUD Hedged
By: Australian Fund Monitors
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| Fund Overview | The investment objective of the Fund is to achieve long-term capital appreciation with low correlation to global equity markets through investment in the Underlying Fund. Fund One is a global macro fund that utilises quantitative research including machine learning techniques and fully automated trading algorithms which will aim to generate positive uncorrelated returns relative to any significant equity benchmark. The traded instruments are either major FX pairs or the most liquid exchange traded stock index, bond, and commodity futures across North America, Europe and Asia Pacific. The algorithm backtests over 10 years of tick data and in order to do so effectively requires machine learning to filter noise and identify meaningful signals, which results in statistically significant prediction of price movements. In production this processing is done in real time and the portfolio reacts to asset movements by rebalancing automatically to the desired risk exposure through the market impact optimised execution logic. Risk management layers built into the algorithm have been developed using the experience the team has gained from their decades in highly liquid fast-moving markets in the proprietary High Frequency Trading world. This allows the system to trade autonomously but safely to all trading opportunities and potential system issues, and to alert the team to any behaviour outside of strictly controlled bounds. The Fund is a 'feeder fund' which indirectly gains exposure to the underlying assets by investing all or substantially all of its assets in the Underlying Fund. The Fund may retain a certain amount of cash from the investment in the Fund for the purpose of payment of costs, fees, hedging and expenses. |
| Manager Comments | The Fund's capacity to significantly outperform in falling markets is highlighted by the following statistics (since inception): average negative monthly return of -1.85% vs AFM's Global Equity Index's -2.12%, maximum drawdown of -8.14% vs the Index's -13.19%, and down-capture ratio of -51.5%. The Fund's negative down-capture ratio indicates that, on average, the Fund has risen during the market's negative months. The best performance assets for the month were: Hang Seng Index (+3.13% of NAV), E-mini S&P 500 (+2.13% of NAV) and Euro Stoxx 50 (+2.06% of NAV). The worst performing assets were: Nikkei 225 (-1.06% of NAV), E-mini Russell (-2.30% of NAV) and Hang Seng China Ent. Index (-3.98% of NAV). |
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Performance Report: Gyrostat Absolute Return Income Equity Fund
17 Dec 2020 - Australian Fund Monitors
The Gyrostat Absolute Return Income Equity Fund has returned +7.28% over the past 12 months with a volatility of 7.36%. Since inception in December 2010, the Fund has returned +4.64% p.a. with an annualised volatility of 4.26%.
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17 Dec 2020 - Performance Report: Gyrostat Absolute Return Income Equity Fund
By: Australian Fund Monitors
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| Fund Overview | The investment objective is to deliver regular and stable income stream (from ASX20 dividends) in a low interest rate environment with capital security - a 'highly-defensive' asset class. Gyrostat has operated for 38 consecutive quarters within a 'hard' pre-defined risk parameter (no more than 3% capital at risk with the Fund's maximum draw-down 2.2% in any circumstances) always in place, delivering regular income by passing through ASX-20 dividends, and meeting returns guidance based upon market conditions (demonstrating increasing returns with market volatility). The Fund buys and holds ASX-20 and international assets with lowest cost protection always in place with upside. It is a conservative asset allocation. Note that Gyrostat have expanded their international assets within the Fund to include SP500, FANGS, Nikkei, Hang Seng, MSCI China, MSCI Developed and Developing markets. Advances in investment risk management enable cost-effective protection to always be in place for a 'hard' defined risk parameter (say no more than 3% capital at risk). Returns are designed to increase as volatility levels increase, as this provides more opportunities to lower protection costs. Investment Objectives: - Returns: 6% - 8% pa in trending markets, greater than 8% pa in volatile markets, BBSW90 + 3% in stable markets - Income: Minimum cash rate + 3% paid semi-annually (currently 4.0% p.a.) from dividends and franking credits - Protection: No quarterly NAV draw-downs exceeding 3% Also includes a 'tail hedge' for gains on large market falls. |
| Manager Comments | The Fund returned -0.12% in November. Gyrostat highlighted that on the 16th of November the ASX suffered a major outage to its ASX Trade system cause by a software issue following a system upgrade relating to the trading of combination orders which they believe resulted in inaccurate market data. The Fund typically uses combination orders as part of its normal trading strategy and, to prevent losses, promptly altered their normal trading strategy. Gyrostat noted this meant the Fund could not capture as much upside post 16th of November. At no times during the outage did the Fund breach its investment guidelines or fail to meet its objectives, highlighting the resilience of the Fund's trading strategy and systems. Gyrostat anticipate low levels of 'late cycle' market volatility with elevated geopolitical risk, historically high debt levels and elevated valuations. |
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