NEWS
Performance Report: DS Capital Growth Fund
31 Aug 2020 - Australian Fund Monitors
The DS Capital Growth Fund rose +2.19% in July, outperforming the ASX200 Accumulation Index by +1.69% and taking the 12-month return to +7.88% versus the Index's -9.87%. Since inception in December 2012, the Fund has returned +14.37% p.a....
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31 Aug 2020 - Performance Report: DS Capital Growth Fund
By: Australian Fund Monitors
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| Fund Overview | The investment team looks for industrial businesses that are simple to understand; they generally avoid large caps, pure mining, biotech and start-ups. They also look for: - Access to management; - Businesses with a competitive edge; - Profitable companies with good margins, organic growth prospects, strong market position and a track record of healthy dividend growth; - Sectors with structural advantage and barriers to entry; - 15% p.a. pre-tax compound return on each holding; and - A history of stable and predictable cash flows that DS Capital can understand and value. |
| Manager Comments | The Fund's capacity to achieve superior risk-adjusted returns whilst avoiding the market's downside is highlighted by the following statistics (since inception): Sharpe ratio of 1.09 vs the Index's 0.51, Sortino ratio of 1.57 vs the Index's 0.58, and down-capture ratio of 45.22%. The Fund's down-capture ratio indicates that, on average, the Fund has fallen less than half as much as the market during the market's negative months. |
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Performance Report: Surrey Australian Equities Fund
31 Aug 2020 - Australian Fund Monitors
The Surrey Australian Equities Fund rose +3.40% in July, outperforming the ASX200 Accumulation Index by +2.9% and taking 12-month performance to +1.58% versus the Index's -9.87%. Since inception in June 2018, the Fund has returned +4.60%...
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31 Aug 2020 - Performance Report: Surrey Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The Investment Manager follows a defined investment process which is underpinned by detailed bottom up fundamental analysis, overlayed with sectoral and macroeconomic research. This is combined with an extensive company visitation program where we endeavour to meet with company management and with other stakeholders such as suppliers, customers and industry bodies to improve our information set. Surrey Asset Management defines its investment process as Qualitative, Quantitative and Value Latencies (QQV). In essence, the Investment Manager thoroughly researches an investment's qualitative and quantitative characteristics in an attempt to find value latencies not yet reflected in the share price and then clearly defines a roadmap to realisation of those latencies. Developing this roadmap is a key step in the investment process. By articulating a clear pathway as to how and when an investment can realise what the Investment Manager sees as latent value, defines the investment proposition and lessens the impact of cognitive dissonance. This is undertaken with a philosophical underpinning of fact-based investing, transparency, authenticity and accountability. |
| Manager Comments | The Fund's July return was largely achieved across the board with most holdings performing well. Surrey noted much of this is a consequence of the portfolio being structured toward companies with low or even positive correlation to COVID-19. They were particularly pleased with the returns provided by Catapult Group (CAT) and Sezzle (SZL) which they discuss in detail in their latest report. The Fund ended the month with 3% in cash and a diversified portfolio of 27 individual stock positions. By sector, it was most heavily weighted towards the IT and Industrials sectors. Top holdings included Appen Limited, Austal Limited, Imricor Medical Systems, Omni Bridgeway and Xero Limited. |
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Performance Report: Gyrostat Absolute Return Income Equity Fund
28 Aug 2020 - Australian Fund Monitors
The Gyrostat Absolute Return Income Equity Fund has risen +11.49% over the past 12 months with a volatility of 7.83%. Since inception in December 2010, the Fund has returned +4.92% p.a. with an annualised volatility of 4.28%.
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28 Aug 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 | Market conditions in July enabled Gyrostat to enter additional positions for more elevated returns on any uplift in market volatility. The investment strategy allows up to 15% of the Fund's assets to be invested in international assets, with positions in SP500, Nasdaq, Hang Seng, MSCI Developed and Emerging Markets (among others). Gyrostat anticipate returns in all market environments of at least BBSW 90 +3% which they expect will enable investors to receive income and capital growth. The Fund also includes a 'tail hedge' for gains on large market falls. Gyrostat anticipate increasing levels of 'late cycle' market volatility with elevated geopolitical risk, historically high debt levels and elevated valuations. |
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Performance Report: Australian Eagle Trust Long-Short Fund
28 Aug 2020 - Australian Fund Monitors
The Australian Eagle Trust Long-Short Fund rose +3.60% in July, taking 12-month performance to +4.19% versus the ASX200 Accumulation Index's -9.87%. Since inception in July 2016, the Fund has returned +17.95% p.a. against the Index's...
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28 Aug 2020 - Performance Report: Australian Eagle Trust Long-Short Fund
By: Australian Fund Monitors
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| Manager Comments | The portfolio's largest positive contributors for the month came from long positions in Fortescue Metals Group, OZ Minerals and QBE Insurance Group, while the largest detractors were long positions in AMP, Pushpay Holdings and CSL. The Fund ended the month with 31 long positions and 23 short positions with the largest exposure to medical devices & services and technology stocks. The Fund ended the month with relatively less exposure to banking and real estate stocks. |
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Performance Report: Insync Global Capital Aware Fund
27 Aug 2020 - Australian Fund Monitors
The Insync Global Capital Aware Fund rose +1.36% in July, taking the Fund's 12-month return to +16.23% versus AFM's Global Equity Index's +2.80%. Since inception in October 2009, the Fund has returned +11.80% p.a. against the Index's...
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27 Aug 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 | At month-end, the portfolio's top holdings included PayPal, Microsoft, Visa, Adobe, JD Sports Fashion, Facebook, Walt Disney, Accenture, S&P Global and Zoetis. The top three megatrends in the portfolio by weight were the 'Age Related Health Solutions' and 'Digitisation' megatrends (both at 14% of the portfolio), followed by the 'Cashless Society' megatrend (13% of the portfolio). |
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Performance Report: Bennelong Kardinia Absolute Return Fund
26 Aug 2020 - Australian Fund Monitors
The Bennelong Kardinia Absolute Return Fund rose +1.90% in July, outperforming the ASX200 Accumulation Index by +1.4% and taking annualised performance since inception in May 2006 to +8.45% versus the Index's annualised return over the...
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26 Aug 2020 - Performance Report: Bennelong Kardinia Absolute Return Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund's discretionary investment strategy commences with a macro view of the economy and direction to establish the portfolio's desired market exposure. Following this detailed sector and company research is gathered from knowledge of the individual stocks in the Fund's universe, with widespread use of broker research. Company visits, presentations and discussions with management at CEO and CFO level are used wherever possible to assess management quality across a range of criteria. Detailed analysis of company valuations using financial statements and forecasts, particularly focusing on free cash flow, is conducted. Technical analysis is used to validate the Manager's fundamental research and valuations and to manage market timing. A significant portion of the Fund's overall performance can be attributed to the attention and importance given to the macro economic outlook and the ability and willingness to adjust the Fund's market risk. |
| Manager Comments | Top contributors in July included Harvest Technology, Fortescue, Kogan, Breville Group and Exore Resources. Key detractors included Paradigm, Flight Centre, Polynovo and Worley. Given the rally in the market, the Short Book detracted -102 basis points from the Fund's return, largely driven by a short position in Share Price Index Futures contracts. Kardinia's net market exposure at month-end was 72.1% (77.1% long and 5.0% short), with the key changes being the removal of the short position in Share Price Index Futures. Other key changes to the portfolio included new long positions in Aroa Biosurgery, Exore Resources and Temple and Webster, as well as increased weightings in Commonwealth Bank, James Hardie, National Australia Bank and West African Resources. This was partially offset by reduced positions in Alumina, Boral and REA Group. Kardinia continue to watch the actions of governments and central banks global in response to the COVID-19 pandemic as they believe these are the key drivers of markets. In particular, they are monitoring negotiations around the second stimulus bill in the US as well as the lead up to the US election. The Fund's key holdings are in technology, gold and yield stocks. |
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Performance Report: Datt Capital Absolute Return Fund
26 Aug 2020 - Australian Fund Monitors
The Datt Capital Absolute Return Fund rose +10.84% in July, outperforming the ASX200 Accumulation Index by +10.34% and taking 12-month performance to +30.27% versus the Index's -9.87%. Since inception in August 2018, the Fund has returned...
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26 Aug 2020 - Performance Report: Datt Capital Absolute Return Fund
By: Australian Fund Monitors
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| Fund Overview | Our investment objectives are: 1) To minimise the risk of permanent capital loss 2) Generate a net return of 10% through the economic cycle An unconstrained, concentrated approach focused on superior risk-adjusted returns. The investment strategy: - targets long-term capital growth in a prudent manner, with an emphasis on capital preservation and low volatility in returns - aims to outperform in markets where equities are down - diversifies investments across asset classes and duration to reduce risk while maintaining relatively concentrated exposure to attractive investment opportunities - is an application of the Manager's investment process, that has no institutional constraints and is completely benchmark unaware |
| Manager Comments | In July, the Fund benefited from its exposure towards previous metals which appreciated strongly over the month. Gold rose over 8% while silver rose by approximately 30%. Datt Capital believe much of the rise in precious metals has been driven by a shift in investor preference towards real assets as a consequence of monetary stimulus & debasement being experienced around the globe. They also believe an increase in authoritarianism and subsequent rise in government distrust is driving sentiment towards portable, durable and private real assets. Datt Capital noted they remain oriented towards growth opportunities and special situations where they feel there remains considerable upside despite the forecast weaker macroeconomic environment. They continue to find interesting opportunities, however, they feel caution is warranted going forward. |
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Performance Report: Bennelong Twenty20 Australian Equities Fund
26 Aug 2020 - Australian Fund Monitors
The Bennelong Twenty20 Australian Equities Fund rose +1.48% in July, outperforming the ASX200 Accumulation Index by +0.98% and taking annualised performance since inception in November 2009 to +9.49% versus the Index's annualised return...
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26 Aug 2020 - Performance Report: Bennelong Twenty20 Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is managed as one portfolio but comprises and combines two separately managed exposures: 1. An investment in the top 20 stocks of the markets, which the Fund achieves by taking an indexed position in the S&P/ASX 20 Index; and 2. An investment in the stocks beyond the S&P/ASX 20 Index. This exposure is managed on an active basis using a fundamental core approach. The Fund may also invest in securities expected to be listed on the ASX, securities listed or expected to be listed on other exchanges where such securities relate to ASX-listed securities.Derivative instruments may be used to replicate underlying positions and hedge market and company specific risks. The companies within the portfolio are primarily selected from, but not limited to, the S&P/ASX 300 Accumulation Index. The Fund typically holds between 40-55 stocks and thus is considered to be highly concentrated. This means that investors should expect to see high short-term volatility. The Fund seeks to achieve growth over the long-term, therefore the minimum suggested investment timeframe is 5 years. |
| Manager Comments | As at the end of July, the portfolio's weightings had been increased in the Industrials, Consumer Staples, Communication, Materials, Health Care, IT and REIT's sectors, and decreased in the Discretionary, Energy and Financials sectors. By comparison with the Fund's benchmark (ASX300 Accumulation Index), the portfolio is significantly more heavily weighted towards the Discretionary sector with an 'Active Weight' of 19.6%. |
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Performance Report: Frazis Fund
24 Aug 2020 - Australian Fund Monitors
The Frazis Fund rose +6.1% in July, taking 12-month performance to +45.96% versus AFM's Global Equity Index's +2.80%. Since inception in July 2018, the Fund has returned +11.41% p.a. against the Index's annualised return over the same...
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24 Aug 2020 - Performance Report: Frazis Fund
By: Australian Fund Monitors
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| Fund Overview | The manager follows a disciplined, process-driven, and thematic strategy focused on five core investment strategies: 1) Growth stocks that are really value stocks; 2) Traditional deep value; 3) The life sciences; 4) Miners and drillers expanding production into supply deficits; 5) Global special situations; The manager uses a macro overlay to manage exposure, hedging in three ways: 1) Direct shorts 2) Upside exposure to the VIX index 3) Index optionality |
| Manager Comments | In July, Frazis added to positions in Disney and digital health providers which they expect to benefit from a coronavirus vaccine, while also examining every other company in the portfolio. Frazis noted the five-year outlook for the portfolio holdings is stronger than ever, therefore they have left most of the portfolio unchanged. The top four contributors for the month included Afterpay, Carvana, Tesla and Livongo. |
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Performance Report: Touchstone Index Unaware Fund
24 Aug 2020 - Australian Fund Monitors
The Touchstone Index Unaware Fund rose +0.55% in July, taking performance over the past 3 months to +6.54% and the Fund's annualised return since inception in April 2016 to +6.23% with an annualised volatility of 15.87%.
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24 Aug 2020 - Performance Report: Touchstone Index Unaware Fund
By: Australian Fund Monitors
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| Fund Overview | The portfolio is constructed using Touchstone's Quality-At-a-Reasonable-Price ('QARP') investment process. QARP is a fundamental bottom-up process, however, it also incorporates a top-down risk management framework designed to successfully manage the portfolio during varying market conditions and economic cycles. The Touchstone Fund is concentrated, typically holding between 15-20 stocks. No individual stock will ever make up more than 10% of the portfolio at any one time. The Investment Manager may temporarily exceed the exposure limits of the Fund occasionally, particularly during periods of market volatility, to allow for holdings in excess of this 10% limit where the increase in value of the underlying security is due to market movement. The Fund may also hold between 0-50% of the portfolio in cash. The Fund has a high level of associated risk, therefore, the minimum suggested investment time-frame is 5 years. |
| Manager Comments | At month-end, the Fund held 19 stocks with a median position size of 4.8%. The portfolio's holdings had an average forward year price/earnings of 21.9, forward-year tangible ROE of 10.9% and forward-year dividend yield of 2.6%. The Fund ended the month with a cash weighting of 5.5%, up from 5.1% as at the end of June. |
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