NEWS
Performance Report: KIS Asia Long Short Fund
31 Oct 2018 - Australian Fund Monitors
The KIS Asia Long Short Fund rose +0.18% in September, outperforming the ASX200 Accumulation Index by +1.44%. Since inception in October 2009, the Fund has returned +12.88% per annum versus the market's 7.67%.
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31 Oct 2018 - Performance Report: KIS Asia Long Short Fund
By: Australian Fund Monitors
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| Fund Overview | Whilst the Fund's primary strategy is focused on long/short equities, the ability to retain discretionary powers to allocate across a number of other investment strategies is reserved. These strategies may include, but not be limited to: convertible bond investments, portfolio hedging, equity related arbitrage, special situations (e.g. merger arbitrage, rights offerings, participation in international public offerings and placements, etc.). The Fund's geographic focus is Asia excluding Japan, but including Australia). The Fund may invest outside of this region to the extent that: 1. The investment decision is driven from the Asian region or; 2. The exposure is intended to mitigate risk or enhance return from factors external to the Asian region. |
| Manager Comments | During the month the Fund benefited from long call option positions on the HSECI. KIS noted being long an index is unusual for them as they usually have an excess of long ideas that need to be hedged and hence are short indices. Due to weakness in the Hong Kong markets in the first half of September KIS stopped out of various equity long positions. To avoid the risk of a snap back in the market leading to losses on unhedged short equities KIS bought calls and, in tandem with having been short futures earlier in the month, this contributed +0.22%. Across all of the Fund's index hedges, the rest of which were either short futures or long puts, the Fund generated a total of +0.29%. Other positive contributors included GTN Ltd (+0.23%) and SembCorp Marine Ltd (+0.23%). KIS remain long GTN Ltd and have exited their long position in SembCorp Marine Ltd. Key detractors included Telstra (-0.23%) and Vocus (-0.21%). KIS still see the telecom industry in severe difficulty and expect operators such as TPG Telecom (a significant previous contributor delivering +1.06% on the quarter) to compete fiercely on price to gain market share. The Fund also suffered a -1.08% loss on a long position in Aveo Group (AOG.AX). KIS significantly reduced their holding in AOG after the Four Corners report on poor conditions for aged care residents and the Prime Minister's response of a Royal Commission. They believe the timeline for the Royal Commission would lead to a delay in any developments at AOG.AX. |
| More Information |
Fund Review: Insync Global Capital Aware Fund September 2018
30 Oct 2018 - Australian Fund Monitors
Latest Fund Review on Insync Global Capital Aware Fund is now available. The Global Capital Aware Fund invests in a concentrated portfolio of 15-30 stocks, targeting exceptional, large cap global companies with a strong focus on dividend...
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30 Oct 2018 - Fund Review: Insync Global Capital Aware Fund September 2018
By: Australian Fund Monitors
AFM Fund Review - September 2018 (pdf format)
INSYNC GLOBAL CAPITAL AWARE FUND
Attached is our most recently updated Fund Review on the Insync Global Capital Aware Fund.
We would like to highlight the following:
- The Global Capital Aware 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 - September 2018 (pdf format)
4 ways to cope with this correction
29 Oct 2018 - Dean Fergie, Cyan Investment Management
As of today, the All Ords will have pulled back more than 10% in less than two months. It's officially a correction now. Here are four strategies on how to cope.
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29 Oct 2018 - 4 ways to cope with this correction
By: Dean Fergie, Cyan Investment Management
Performance Report: Bennelong Concentrated Australian Equities Fund
29 Oct 2018 - Australian Fund Monitors
The Bennelong Concentrated Australian Equities Fund has risen +17.56% over the past 12 months versus the ASX200 Accumulation Index's +13.97%. Since inception in February 2009, the Fund has returned +17.73% p.a. versus the Index's +10.86%.
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29 Oct 2018 - 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 | As at the end of September, the portfolio's weightings had been increased in the Discretionary, Consumer Staples, Industrials, Communication and Materials sectors, and decreased in the Health Care, IT and Financials sectors. The Fund's cash weighting was reduced from 1.6% to 0.9%. The Fund aims to invest in a concentrated portfolio of high quality companies with strong growth outlooks and underestimated earnings momentum and prospects. By comparison with the Fund's benchmark (ASX300 Accumulation Index), the portfolio's holdings, on average, have a higher return on equity and lower debt/equity (Premium Quality), higher sales growth and higher EPS growth (Superior Growth), as well as higher price/earnings and lower dividend yield (Reasonable Valuation). |
| More Information |
Hedge Clippings - 26 October, 2018
26 Oct 2018 - Australian Fund Monitors
Market volatility is back with a vengeance, so it's worth looking at two lesser used analytical tools - up and down capture ratios...
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26 Oct 2018 - Hedge Clippings - 26 October, 2018
By: Australian Fund Monitors
Market volatility - back with a vengeance!
Last week's Hedge Clippings briefly touched on market volatility (interestingly it was 19 October, the anniversary of the 1987 crash) and the risk of averages when grouping funds. Given the continuing volatility this week, and with the expectation of more to come, it's worth focusing on the best way to analyse a fund's downside risk.
There are a number of risk factors apart from volatility or standard deviation which are pretty well understood and known. Basics such as maximum drawdown, % positive and negative months, worst month etc. are frequently used and quoted.
However a couple we look at that are neither well known, or it seems frequently quoted are Up Capture and Down Capture ratios. Put simply, a fund's up capture ratio over a specific time period (the longer the better) shows how much of the market's positive performance a fund "captures". And importantly given we're talking about volatile markets, the down capture ratio measures how much of the market's negative performance a fund captures.
The key to accurately measuring each is not to simply measure the average positive or negative performance of the fund vs. the market. Instead, each is calculated by measuring the market's cumulative performance for all its positive or negative months, and then calculating the cumulative performance of the fund over those same months, and expressing that as a percentage, with a result of 100% meaning the fund tracks the index exactly.
For up capture, any number less than 100% means the fund underperforms in positive markets, and if the number is greater than 100%, the fund outperforms when the market is rising.
More importantly in the current environment, for down capture, a result less than 100% means the fund falls less than the market, while a negative number means the fund provides positive returns when the market falls.
Comparing and analysing funds is never easy, but by looking at the down capture ratios of different funds over various time periods will provide a useful guide when putting together a portfolio of funds.
Two important factors to remember of course are that the longer the track record of the fund, the more data points that are available to measure, and thus more instances of rising and falling markets - and secondly, that while a useful tool to understand a fund's performance, it is only past performance being measured.
Performance Report: Quay Global Real Estate Fund
26 Oct 2018 - Australian Fund Monitors
The Quay Global Real Estate Fund has risen +16.1% over the past 12 months, outperforming its benchmark (FTSE/EPRA NAREIT Developed Index Net TR AUD) by +3.6%. Since inception in July 2014, the Fund has returned +14.45% per annum.
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26 Oct 2018 - 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 | Impacting performance in September was across-the-board weakness in the Fund's US REIT exposures, as the US 10-year bond yield rose to +3.1% in the later stages of the month. Performance was also impacted by continued weakness in the HK property names from trade war fears and the strength of the HKD. The largest detractors were Ventas (US Healthcare), Cubesmart (US Storage) and Scentre (Australian Retail). Positive contributors included Unite (UK Student Accommodation), RLJ (US Hotels) and Essex (US Multifamily). Quay noted that during the month they toured Singapore, the UK, Hong Kong and the USA, meeting with numerous management teams from their investees, their competitors and potential investment opportunities. Quay noted they came away with a confident outlook. |
| More Information |
Performance Report: Glenmore Australian Equities Fund
25 Oct 2018 - Australian Fund Monitors
The Glenmore Australian Equities Fund has risen +32.29% over the past 12 month versus the ASX200 Accumulation Index's +13.97%. Since inception in June 2017, the Fund has returned +35.56% p.a. versus the Index's +11.01%.
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25 Oct 2018 - Performance Report: Glenmore Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The main driver of identifying potential investments will be bottom up company analysis, however macro-economic conditions will be considered as part of the investment thesis for each stock. |
| Manager Comments | The Fund returned -0.47% in September, outperforming the Index by +0.79%. Top contributors included Mastermyne (+18.6%) and Alliance Aviation (+10.7%). Other positive contributors included Jumbo Interactive, Pinnacle Investments and Bravura Solutions. Key detractors included Navigator Global Investments (-7.6%) and Emeco Holdings (-5.5%). Following reporting season, Glenmore continue to meet with the management teams of a large number of potential investments for the Fund and remain very optimistic that any volatility in equities markets in the future will create some attractive buying opportunities. Currently the portfolio comprises approximately 16% cash and is therefore well positioned. |
| More Information |
Fund Review: Bennelong Long Short Equity Fund September 2018
24 Oct 2018 - Australian Fund Monitors
Latest Fund Review for the Bennelong Long Short Equity Fund is now available. The Fund is a research driven, market and sector neutral, "pairs" trading strategy investing primarily in large-caps from the ASX/S&P100 Index...
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24 Oct 2018 - Fund Review: Bennelong Long Short Equity Fund September 2018
By: Australian Fund Monitors
AFM Fund Review - September 2018 (pdf format)
BENNELONG LONG SHORT EQUITY FUND
Attached is our most recently updated Fund Review on the Bennelong Long Short Equity Fund.
- The Fund is a research driven, market and sector neutral, "pairs" trading strategy investing primarily in large-caps from the ASX/S&P100 Index, with over 15-years' track record and an annualised returns of over 16%.
- The consistent returns across the investment history indicate the Fund's ability to provide positive returns in volatile and negative markets and significantly outperform the broader market. The Fund's Sharpe Ratio and Sortino Ratio are 0.99 and 1.66 respectively.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - September 2018 (pdf format)
Performance Report: Cyan C3G Fund
23 Oct 2018 - Australian Fund Monitors
The Cyan C3G Fund has returned +10.99% over the past 12 months. Since inception, the Fund has returned +22.65% p.a. versus the market's +7.13%.
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23 Oct 2018 - 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 | In September the Fund returned -2.2%, taking the gain for the first quarter of FY19 to a modest +0.7% (after all fees). Throughout the month, there were three positive performers - Acrow, Noni B and newly added Spicers Paper. The remaining 20 or so positions fell between 1% - 13% which Cyan noted was in part due to the slightly bearish market disposition mirrored by the -1.1% fall in the All Ords. In addition, Cyan have been involved in a number of transactions (both IPO's and placements) that they expect to add meaningful value to the Fund in the coming months. Cyan noted that, in light of recent performance, their philosophy acknowledges the reality of stock volatility. They noted that even great multi-year investments will have periods of retracement and consolidation, highlighting the fact that CSL, despite rising more than 500% over the past 10 years, has suffered 15 monthly falls of more than 5% during that timeframe. Cyan aim to ignore market gyrations and focus on the underlying fundamentals and growth paths of their investee companies. Cyan remain confident in the future earnings capabilities of their investments. |
| More Information |
Bennelong Twenty20 Australian Equities Fund September 2018
22 Oct 2018 - 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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22 Oct 2018 - Bennelong Twenty20 Australian Equities Fund September 2018
By: Australian Fund Monitors
AFM Fund Review - September 2018 (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 - September 2018 (pdf format)
