NEWS
Optimal Australia Absolute Trust
12 May 2016 - Australian Fund Monitors
Optimal Australia Absolute Trust returned -0.69% return in April.
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12 May 2016 - Optimal Australia Absolute Trust
By: Australian Fund Monitors
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| Fund Overview | The Fund's bias is likely to be net long under normal market conditions, with the core strategy being to construct a portfolio of listed equity securities priced at levels that do not adequately reflect their underlying value. The Fund will seek to boost returns and limit potential market downside by selective short selling of individual stocks which are priced at levels that are viewed as materially above their underlying value. The Fund will also use certain trading strategies both within its core portfolio (through rebalancing stock weights and overall market exposure in response to price movements) and in certain other situations (typically of a shorter-duration and/or opportunistic nature) with the objective of further increasing returns. |
| Manager Comments | Fund returns for April were impacted by the net short market exposure, averaging 17% of NAV. The performance was further impacted by the weaker stock price performance from some of the high conviction longs in the retail and media sectors. The Fund's tactical positioning in natural resources and some defensive consumer exposures worked well, posting solid gains. At month-end, the Fund's gross exposure was at 77% and net at -20%. Click below to read the latest Fund monthly report. |
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Bennelong Kardinia Absolute Return Fund
11 May 2016 - Australian Fund Monitors
The Bennelong Kardinia Absolute Return Fund rose
0.52 in April.
0.52 in April.
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11 May 2016 - 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 | BHP Billiton, Pilbara Minerals, BWX, and Amcor were the largest positive contributors whilst Qantas, Share Price Index Futures contracts (hedging long positions), Mantra and Blackmores were the largest detractors. Net equity market exposure (including derivatives) was increased to 30.8% (43.7% long and 12.9% short). Click below to read the latest Fund Report. |
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Cyan C3G Fund
11 May 2016 - Australian Fund Monitors
Cyan C3G Fund rose 7.90% in April 2016, outperforming the ASX 200 Accumulation Index which returned +3.37, by 4.53%.
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11 May 2016 - 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 | Majority of companies that Cyan C3G Fund was invested in, delivered positive performances. The most notable contributors included Freelancer (FLN) +29%, Adacel (ADA) +9%, Skydive The Beach (SKB) +19% and Vita Group (VTG) +12%. Overall, the Fund remains conservative, exposed to high-quality and well-diversified portfolio of 27 Australian smaller companies with no single stock representing more than 6% of the total Cyan portfolio. Click below to read the latest Fund Manager's Report. |
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The Paragon Fund
10 May 2016 - Australian Fund Monitors
The Paragon Fund rose 10.80% after fees for the month of April 2016.
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10 May 2016 - The Paragon Fund
By: Australian Fund Monitors
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| Fund Overview | Paragon believes that markets are not always efficient, exhibiting a common tendency to price securities well outside of their intrinsic value over the medium term. This market characteristic provides the opportunity for Paragon, an active manager with a flexible mandate, to generate superior investment returns over the longer term. Paragon believes that it is critical to understand both the companies and the industries in which they operate, in order to fully comprehend each investment opportunity. Accordingly, a fundamental approach to company research is taken. Assessing the potential downside is also paramount in framing the risk/reward trade-off for potential investments. |
| Manager Comments | Key positive contributors for April included the longs in the lithium holdings ORE, GMM, GXY & PLS, the oil holdings STO & ORG, the gold holdings including NCM and SBM, and various Industrial holdings including LNK, YOW, NAN and NTC. At the end of the month the Fund had 34 long positions and 9 short positions. Click below to read the latest monthly report. |
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Fund Review: Meme Australian Share Fund April 2016
9 May 2016 - Australian Fund Monitors
April Fund Review is now available on Meme Australian Share Fund, that invests in ASX listed securities outside of the S&P/ASX20.
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9 May 2016 - Fund Review: Meme Australian Share Fund April 2016
By: Australian Fund Monitors
AFM Fund Review - April 2016 (pdf format)
Meme Australian Share Fund
Attached is our most recently updated Fund Review on the Meme Australian Share Fund.
We would like to highlight the following aspects of the Fund;
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The Meme Capital Management is a Perth-based boutique Fund Manager, established in 2012 and manages the Meme Australian Share Fund.
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The Fund specializes in technical and quantitative strategies to identify investment opportunities expected to provide both positive price appreciation and relative price out-performance over the medium to long term.
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The Fund's objective is to outperform the S&P/ASX All Ordinaries Accumulation Index over rolling three year periods, through investing in ASX listed securities outside the S&P/ASX 20. The Fund only takes long positions and does not use derivatives.
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Since inception the Fund has an annualised return of 18.90% p.a., versus the Index's return of 7.92% p.a.
AFM Fund Review - April 2016 (pdf format)
Bennelong Long Short Equity Fund
6 May 2016 - Australian Fund Monitors
Bennelong Long Short Equity Fund returned -2.30% for the month of April.
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6 May 2016 - Bennelong Long Short Equity Fund
By: Australian Fund Monitors
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| Fund Overview | In a typical environment the Fund will hold around 70 stocks comprising 35 pairs. Each pair contains one long and one short position each of which will have been thoroughly researched and are selected from the same market sector. Whilst in an ideal environment each stock's position will make a positive return, it is the relative performance of the pair that is important. As a result the Fund can make positive returns when each stock moves in the same direction provided the long position outperforms the short one in relative terms. However, if neither side of the trade is profitable, strict controls are required to ensure losses are limited. The Fund uses no derivatives and has no currency exposure. The Fund has no hard stop loss limits, instead relying on the small average position size per stock (1.5%) and per pair (3%) to limit exposure. Where practical pairs are always held within the same sector to limit cross sector risk, and positions can be held for months or years. The Bennelong Market Neutral Fund, with same strategy and liquidity is available for retail investors. |
| Manager Comments | The fund under-performed mainly due to the short book. Two companies in the beginning of the month in the short book performed well by issuing meaningful earnings downgrades. However, these returns were later compromised across a handful of pairs within mainly the financials and energy sectors. Performance was also set back following a disappointing trading update from Qantas in which the company guided the market lower due to a recent softening in activity across both the international and domestic leisure businesses. Click below to read the Fund Manager's commentary and market outlook. |
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Meme Australian Share Fund
6 May 2016 - Australian Fund Monitors
The Meme Australian Share Fund rose 8.60% for the month of April.
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6 May 2016 - Meme Australian Share Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund's investment strategy seeks to identify low-risk entry opportunities and then build positions in these stocks. Once established in the portfolio, individual stock holdings are maintained for as long as their long-term upward trend remains intact and while they continue to make positive contributions to portfolio growth. Positions are reduced and ultimately closed out as their trends become exhausted or as their relative long-term performance against the broad market weakens. The Fund believes that longer time frame investments also provide a number of advantages. The effect of false signals and 'noise' which attend shorter term time frames is mitigated by only attending to signals which are confirmed by our longer term assessments. Also, the Fund gains exposure to the more expansive price trends which can last for months and years, allowing dividends and distributions received during this time to further enhance portfolio returns. |
| Manager Comments | The top 5 positive contributors were Galaxy Resources, Eden Energy, Gascoyne Resources, MGC Pharmaceuticals and Resolute Mining, while the five most negative contributors were Collins Foods, Fisher & Paykel Healthcare, The Reject Shop, Treasury Wine and Hannans Reward. By month end the total number of portfolio stocks had again reduced slightly to 85 separate holdings, however the portfolio was virtually fully invested with cash at just over 1% reflective of the continued emergence of opportunities. The portfolio significantly increased exposure to their Materials holdings, while Energy, Telecommunications and Health sectors had smaller increases. Financials (ex-property) and Consumer Discretionary holdings reduced while other sector exposures remained relatively stable. Click below to read the latest Fund Manager's commentary on the Fund. |
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Fund Review: Supervised High Yield Fund March 2016
4 May 2016 - Australian Fund Monitors
Fund review on Supervised High Yield Fund, a fixed income fund, is now available.
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4 May 2016 - Fund Review: Supervised High Yield Fund March 2016
By: Australian Fund Monitors
AFM Fund Review - March 2016 (pdf format)
SUPERVISED HIGH YIELD FUND
Attached is AFM's updated Fund Review on the Supervised High Yield Fund.
We would like to highlight the following aspects of the Fund:
- The Supervised High Yield Fund (SHYF) has a 6 year track record investing in fixed interest investments. The Investment strategy aims to deliver returns with zero correlation to equity markets by investing in debt securities with minimal default probability and offering a premium return above the risk free rate.
- The Fund is managed by Philip Carden whose experience in debt and capital markets spans over 33 years, including time with JB Were's Capel Court Securities and Macquarie Bank, where he was the Executive Director responsible for the Debt Markets Division.
- SHYF is an Alternative Income fund which invests in Global and Australian debt markets, with all foreign currency receivables hedged back to Australian dollars.
- The Fund utilises a top down analysis of the economic environment and market to screen and identify debt market opportunities which it believes offer low risk with high yield. The next stage is the development of a risk matrix and investment strategy, following which detailed research is undertaken on specific investment opportunities which meet the pre-defined criteria established in the investment strategy.
- Prior to approving an investment for the Fund each potential investment is subject to two stress tests. The first of these is for credit and default risk, in which the investment is stress-tested to ensure that in a worst case economic environment it can repay 100% of its principal and interest obligations case scenario for the asset by examining the highest margin over the risk rate that the investment has previously experienced in a crisis situation. Any decline in value under the stress test that exceeds 10% of the Fund's value is avoided The second test examines market risk. In this case Carden looks at the worst case scenario for the asset by examining the highest margin over the risk rate that the investment has previously experienced in a crisis situation. Any decline in value under the stress test that exceeds 10% of the Fund's value is avoided.
AFM Fund Review - March 2016 (pdf format)
Newgate Real Estate and Infrastructure Fund
4 May 2016 - Australian Fund Monitors
Newgate Real Estate and Infrastructure Fund was flat for (-0.06%) for the month of March.
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4 May 2016 - Newgate Real Estate and Infrastructure Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund's research use detailed analysis of the underlying assets integrated with financial analysis to determine a sustainable yield and fundamental DCF valuation for the security. Also the Fund believes in having a strong risk control framework. The Fund will also use trading strategies via rebalancing of core portfolio positions as well as taking advantage of shorter duration inefficiencies in markets caused by an imbalance in demand and supply for global REIT and Infrastructure securities. The Fund focuses on generating absolute returns after fees of 12 to 15% pa over the medium to long term. The long-short nature of the Fund combined with Newgate's rigorous investment process ensures returns generated by the Fund are largely independent of rising or falling markets. Newgate is focused on providing investment opportunities primarily within core, value-add, opportunistic and development sectors of direct property and across listed and unlisted real estate and infrastructure securities. The Fund's investment team consists of Tim Hannon, Campbell McComb, Darren Brusnahan, Nishant Narayanaswamy and Nicole Merrillees. |
| Manager Comments | The performance of the Fund's long positions were offset by the Fund's overall net short position. The shorts were a number of real estate companies that were assessed to be both overvalued and exposed to a deteriorating environment. However, despite this assessment, these positions rallied strongly over March, primarily on the back of falling bond yields. Positive contributors were Infigen, Aveo Group, Investa Office Fund, while negative contributors were Charter Hall Retail, Dexus Property Group, GPT Group. The Fund's slightly increased their net short position over the month as their overall view remains the same. Click Manager's Report to read more. |
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Fund Review: Insync Global Titans Fund March 2016
3 May 2016 - Australian Fund Monitors
Latest Fund Review on Insync Global Titans Fund is now available.
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3 May 2016 - Fund Review: Insync Global Titans Fund March 2016
By: Australian Fund Monitors
AFM Fund Review - March 2016 (pdf format)
INSYNC GLOBAL TITANS FUND
Attached is our most recently updated Fund Review on the Insync Global Titans Fund.
We would like to highlight the following:
- The Fund's unit price decreased by 4.1% in March. The performance was driven by positive contributions from the holdings in Mead Johnson, Oracle Corp, Zimmer Holdings and Time Warner Inc. The main negative contributors were Sanofi, Roche, PayPal, and Medtronic. The Fund continues to have no foreign currency hedging in place as Insync consider the main risks to the Australian dollar to be on the downside.
- The Global Titans Fund invests in a concentrated portfolio of 15-30 stocks, targeting exceptional, large cap global companies with a strong focus on dividend growth and downside protection.
- Portfolio selection is driven by a core strategy of investing in companies with sustainable growth in dividends, high returns on capital, positive free cash flows and strong balance sheets.
- Emphasis on limiting downside risk is through extensive company research, the ability to hold cash and long protective index put options.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - March 2016 (pdf format)
