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Performance Report: Insync Global Capital Aware Fund
27 Jul 2020 - Australian Fund Monitors
The Insync Global Capital Aware Fund rose +11.29% over the June quarter against AFM's Global Equity Index's +5.97% and taking FY20 performance to +19.35% versus the Index's +3.94%. Since inception in October 2009 the Fund has returned...
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27 Jul 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 | Insync noted the key to the Fund's outperformance over FY20 has been its downside risk management as well as the selection of stocks with long growth runways that aren't closely linked to prevailing economic conditions. The Fund's downside protection (Put options) is being rebuilt after the options were fully exercised in March when volatility reached closed to all-time highs. Insync maintains a positive view for the medium to long-term. Their view is that very low interest rates are making quality sustainable growth companies extremely valuable. They also expect the Megatrends in which they invest are likely to resist a severe recession and a pandemic. At month-end, the portfolio's top holdings included PayPal, Visa, Microsoft, Adobe, JD Sports Fashion, Walt Disney, Accenture, Facebook, S&P Global and Domino's Pizza. 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 Concentrated Australian Equities Fund
27 Jul 2020 - Australian Fund Monitors
The Bennelong Concentrated Australian Equities Fund rose +19.38% over the June quarter and ended FY20 up +8.20% against the ASX200 Accumulation Index's -7.68%. Since inception in February 2009, the Fund has returned +15.45% p.a. against...
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27 Jul 2020 - Performance Report: Bennelong Concentrated Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The overriding objective of the Concentrated Australian Equities Fund is to seek investment opportunities which are under-appreciated and have the potential to deliver positive earnings, while satisfying our stringent quality criteria. Bennelong's investment process combines bottom-up fundamental analysis together with proprietary investment tools which are used to build and maintain high quality portfolios that are risk aware. The portfolio typically consists of 20-35 high-conviction stocks from the S&P/ASX 300 Index. The Fund may invest in securities listed on other exchanges where such securities relate to ASX-listed securities. Derivative instruments are mainly used to replicate underlying positions and hedge market and company specific risks. |
| Manager Comments | The main contributors to performance over the quarter were James Hardie, Breville Group, Fortescue Metals Group and IDP Education. The main detractors were CSL, Fisher & Paykel Healthcare and Afterpay. Bennelong maintain a reasonably balanced outlook for the market, trying not to be either too bullish or too bearish. They noted that, in this context, they continue to see good prospects for a continued recovery in the economy and market. |
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Performance Report: Bennelong Emerging Companies Fund
24 Jul 2020 - Australian Fund Monitors
The Bennelong Emerging Companies Fund rose in line with the market in June, returning +2.22%. Over FY20, the Fund has risen +17.33% against the ASX200 Accumulation Index's -7.68%. Since inception in November 2017, the Fund has returned...
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24 Jul 2020 - 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 | Over the June quarter the Fund outperformed the Index by +31.54% as the micro and small-cap stocks held by the Fund recovered even harder than the broader market. However, Bennelong reiterate that, while micro and small-cap stocks can deliver larger returns, they also come with significantly greater risk. This is highlighted by the fund's annualised volatility since inception of 36.54% against the Index's 17.40%. Top contributors included Viva Leisure, BWX, Baby Bunting, EML Payments and Mader. While each of these companies operate in very different industries, Bennelong noted they are all high quality and believe they have very promising growth prospects. As a result of the volatility seen so far in 2020, particularly in the micro and small-cap end of the market, Bennelong have made a number of changes to the portfolio. They believe the portfolio is currently well positioned for attracted returns over the long-term, regardless of the market's short-term movements. |
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Performance Report: Frazis Fund
24 Jul 2020 - Australian Fund Monitors
The Frazis Fund rose +13.9% in June, outperforming AFM's Global Equity Index by +14.25% and taking performance over FY20 to +38.81% against the Index's +3.94%. Since inception in July 2018, the Fund has returned +8.64% p.a. against the...
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24 Jul 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 | Of the top 10 ASX stocks over FY20, the Frazis Fund had 3 - Afterpay (#1), Mesoblast and Polynovo. Frazis noted companies with brilliant products and broad customer support are faring significantly better than mature incumbents. Frazis believe there is a strong chance Afterpay will enter the Chinese market with Tencent, or at the very least, Hong Kong, which they expect would add years to the company's current growth runway. Other positive contributors over the quarter included Pinduoduo, Carvana, Tesla, Twist Bioscience and Moderna. Frazis believe the multiples of many technology stocks need to compress by 25-50% to re-enter normal valuation ranges. They noted this could happen quickly tomorrow or slowly over time. With this in mind, they are selectively holding companies that they expect to have 300 - 500% larger revenues in 3 - 5 years. Looking forward, the Fund will continue to be invested across its usual themes: Software, Solar & Renewables, Online Retail, Life Sciences, Fintech, Digital Health and companies that change the way people live. |
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Performance Report: Bennelong Australian Equities Fund
23 Jul 2020 - Australian Fund Monitors
The Bennelong Australian Equities Fund rose +1.34% in June, taking FY20 performance to +6.24% against the ASX200 Accumulation Index's -7.68%. Since inception in February 2009, the Fund has returned +12.94% p.a. against the Index's...
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23 Jul 2020 - Performance Report: Bennelong Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The Bennelong Australian Equities Fund seeks quality investment opportunities which are under-appreciated and have the potential to deliver positive earnings. The investment process combines bottom-up fundamental analysis with proprietary investment tools that are used to build and maintain high quality portfolios that are risk aware. The investment team manages an extensive company/industry contact program which helps identify and verify various investment opportunities. The companies within the portfolio are primarily selected from, but not limited to, the S&P/ASX 300 Index. The Fund may invest in securities listed on other exchanges where such securities relate to the ASX-listed securities. The Fund typically holds between 25-60 stocks with a maximum net targeted position of an individual stock of 6%. |
| Manager Comments | Over the June quarter the Fund returned 21.90% against the Index's +16.48%. The main positive contributors to quarterly performance were James Hardie, Breville Group and Fortescue Metals Group. Bennelong noted that, while these stocks were sold off in the market downturn in the previous quarter, their operating businesses have held reasonably well despite covid-related headwinds. The main detractors included CSL and Fisher & Paykel Healthcare, both of which are defensive stocks that significantly outperformed during the previous quarter's downturn but which subsequently underperformed during the June quarter's recovery. Bennelong maintain a reasonably balanced outlook for the market, trying not to be either too bullish or too bearish. They noted that, in this context, they continue to see good prospects for a continued recovery in the economy and market. |
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Performance Report: Cyan C3G Fund
22 Jul 2020 - Australian Fund Monitors
The Cyan C3G Fund rose +0.5% in June, taking annualised performance since inception in August 2014 to +12.94% p.a. against the ASX200 Accumulation Index's annualised return over the same period of 5.22%.
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22 Jul 2020 - Performance Report: Cyan C3G Fund
By: Australian Fund Monitors
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| Fund Overview | Cyan C3G Fund is based on the investment philosophy which can be defined as a comprehensive, clear and considered process focused on delivering growth. These are identified through stringent filter criteria and a rigorous research process. The Manager uses a proprietary stock filter in order to eliminate a large proportion of investments due to both internal characteristics (such as gearing levels or cash flow) and external characteristics (such as exposure to commodity prices or customer concentration). Typically, the Fund looks for businesses that are one or more of: a) under researched, b) fundamentally undervalued, c) have a catalyst for re-rating. The Manager seeks to achieve this investment outcome by actively managing a portfolio of Australian listed securities. When the opportunity to invest in suitable securities cannot be found, the manager may reduce the level of equities exposure and accumulate a defensive cash position. Whilst it is the company's intention, there is no guarantee that any distributions or returns will be declared, or that if declared, the amount of any returns will remain constant or increase over time. The Fund does not invest in derivatives and does not use debt to leverage the Fund's performance. However, companies in which the Fund invests may be leveraged. |
| Manager Comments | Top positive contributors over the month were Quickfee and Kip McGrath. The largest detractor was Jumbo Interactive. Over FY20, top contributors included Quickfee, Swift Networks, Motorcycle Holdings, Afterpay, Alcidion, Atomos, Schrole and Big River. Key detractors included Victory Offices, Murray River Organics, AMA Group, Experience Co, Jaxsta, Raiz and CarbonXT. Cyan remain optimistic of ongoing positive returns, however, they noted they don't believe it's the time to be running a 'set and forget' portfolio. |
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Performance Report: 4D Global Infrastructure Fund
21 Jul 2020 - Australian Fund Monitors
The 4D Global Infrastructure Fund ended the June quarter up +5.11%, outperforming its benchmark (OECD G7 Inflation Index +5.5%) by +3.57% and taking annualised performance since inception in March 2016 to +9.73%.
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21 Jul 2020 - Performance Report: 4D Global Infrastructure Fund
By: Australian Fund Monitors
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| Fund Overview | The fund will be managed as a single portfolio of listed global infrastructure securities including regulated utilities in gas, electricity and water, transport infrastructure such as airports, ports, road and rail as well as communication assets such as the towers and satellite sectors. The portfolio is intended to have exposure to both developed and emerging market opportunities, with country risk assessed internally before any investment is considered. The maximum absolute position of an individual stock is 7% of the fund. |
| Manager Comments | The strongest performer in the portfolio in June was Indonesian toll road operator, Jasa Marga, up +24.4% as it rebounded from an oversold position as traffic starts to recover and the government pledges continued support for the growth of the sector. The weakest performer in June was German airport group, Fraport, down -13.2% as flights remain grounded, COVID-19 continues to spread and expectations of a return to normal travel environments get pushed out further. 4D believe the weak environment has been completely priced into the current share price. 4D noted infrastructure investment delivers a significant economic multiplier when capital is efficiently allocated. Their view is that the prospect of increased need for investment, together with stretched government balance sheets, will inevitably lead to a longer-term trend of increased privatisations and more investment opportunities in infrastructure for the private sector. |
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Performance Report: Bennelong Twenty20 Australian Equities Fund
21 Jul 2020 - Australian Fund Monitors
The Bennelong Twenty20 Australian Equities Fund rose +2.23%, outperforming the ASX200 Accumulation Index by +8.59% over FY20. Since inception in November 2009, the Fund has returned +9.42% p.a. against the Index's annualised return of...
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21 Jul 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 | Over the June quarter, the Fund outperformed the Index by +4.23%. Bennelong noted the Fund's outperformance was entirely due to the ex-20 sleeve of the portfolio. The most notable positive contributor was James Hardie, while Afterpay was the main detractor. Bennelong remain reasonably balanced in their outlook for the market, trying to avoid being too bullish or too bearish. They noted they continue to see good prospects for a continued recovery in the economy and market. |
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Performance Report: Bennelong Kardinia Absolute Return Fund
17 Jul 2020 - Australian Fund Monitors
The Bennelong Kardinia Absolute Return Fund outperformed the ASX200 Accumulation Index by +4.55% over FY20, maintaining an annualised volatility over the past 12 months of 8.19% against the Index's 25.39%. Since inception in May 2006, the...
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17 Jul 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 | Key positive contributors included Commonwealth Bank, JB Hi-Fi, Alumina, Ramelius and REA Group. Key detractors included Virgin Money, Vicinity Centres, Worley and City Chic. Given the major rally in the market, the Short Book was the major detractor from performance this month (-218 basis points). Kardinia reduced the Fund's net equity exposure from 71.3% to a net short position of -4.0% (62.6% long and 66.6% short), with the key change being a significant increase in the Fund's short position in Share Price Index Futures (SPI). Kardinia noted they use SPI to reduce net exposure when they see shorter-term risk as it allows them to keep the long book largely intact whilst protecting the downside. Other key changes to the portfolio included new long positions in Boral, Kogan, Macquarie Group, West African Resources and Zip. Kardinia noted that, with central banks globally attempting to set the shape of the yield curve lower, they believe investors will continue to move capital into equities to chase yield in a world seemingly devoid of such opportunities. |
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Fund Review: Bennelong Twenty20 Australian Equities Fund June 2020
17 Jul 2020 - Australian Fund Monitors
The latest Fund Review on Bennelong Twenty20 Australian Equities Fund is now available. The Fund invests in ASX listed stocks, combining an indexed position in the Top 20 stocks with an actively managed portfolio of ex-20 stocks.
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17 Jul 2020 - Fund Review: Bennelong Twenty20 Australian Equities Fund June 2020
By: Australian Fund Monitors
AFM Fund Review - June 2020 (pdf format)
BENNELONG TWENTY20 AUSTRALIAN EQUITIES FUND
Attached is our most recently updated Fund Review on the Bennelong Twenty20 Australian Equities Fund.
- The Bennelong Twenty20 Australian Equities Fund invests in ASX listed stocks, combining an indexed position in the Top 20 stocks with an actively managed portfolio of stocks outside the Top 20. Construction of the ex-top 20 portfolio is fundamental, bottom-up, core investment style, biased to quality stocks, with a structured risk management approach.
- Mark East, the Fund's Chief Investment Officer, and Keith Kwang, Director of Quantitative Research have over 50 years combined market experience. Bennelong Funds Management (BFM) provides the investment manager, Bennelong Australian Equity Partners (BAEP) with infrastructure, operational, compliance and distribution services.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - June 2020 (pdf format)
