NEWS
10 Feb 2016 - The Paragon Fund
| Report Date | |
| Manager | |
| Fund Name | |
| Strategy | |
| Latest Return Date | |
| Latest Return | |
| Latest 6 Months | |
| Latest 12 Months | |
| Latest 24 Months | |
| Annualised Since Inception | |
| Inception Date | |
| FUM (millions) | |
| 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 January included long positions in Amaysim, Blackham Resources, our lithium holdings, and short positions in Magellan, Select Harvest and the energy sector. At the end of the month the Fund had 34 long positions and 14 short positions. Click below to read the latest monthly report |
| More Information |
10 Feb 2016 - Fund Review: Bennelong Long Short Equity Fund January 2016
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 cap stocks from the ASX/S&P100 Index, with over thirteen year track record and annualised returns of 18.43%.
- The consistent returns across the investment history indicates 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 1.13 (Index 0.27) and 1.95 (Index 0.27) respectively.
For further details on the Fund, please do not hesitate to contact us.
8 Feb 2016 - Meme Australian Share Fund
| Report Date | |
| Manager | |
| Fund Name | |
| Strategy | |
| Latest Return Date | |
| Latest Return | |
| Latest 6 Months | |
| Latest 12 Months | |
| Latest 24 Months | |
| Annualised Since Inception | |
| Inception Date | |
| FUM (millions) | |
| 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 five most positive contributors to the fund's January performance were Galaxy Resources, Collins Foods, Treasury Wine Estate, Ramelius Resources and General Mining Corporation. The five most negative contributors were HUB24, Netcomm, Blackmores, Adacel Technologies and Structural Monitors. Three of the top five negative contributors for the month were amongst the Fund's top ten holdings. The total number of portfolio stocks decreased from the previous month's 96 to 89, with portfolio cash sitting at just above 1%. During the month, the Fund's exposure to the Materials, Energy, Industrials and Utilities sectors increased and to the Financials, Consumer Discretionary and Telecommunications sectors decreased, with exposure to other sectors remained relatively stable. Click below to read the latest Fund Manager's commentary on the Fund. |
| More Information |
5 Feb 2016 - Bennelong Long Short Equity Fund
| Report Date | |
| Manager | |
| Fund Name | |
| Strategy | |
| Latest Return Date | |
| Latest Return | |
| Latest 6 Months | |
| Latest 12 Months | |
| Latest 24 Months | |
| Annualised Since Inception | |
| Inception Date | |
| FUM (millions) | |
| 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 number of winning pairs was outnumbered by losing pairs over the month. The three strongest performing pairs delivered greater P&L than the Fund's largest detractors, hence stabilising performance. News flow was generally light in January ahead of the February profit reporting season. Click below to read the Fund Manager's commentary and market outlook. |
| More Information |
4 Feb 2016 - Jamieson Coote Bonds Active Fund
| Report Date | |
| Manager | |
| Fund Name | |
| Strategy | |
| Latest Return Date | |
| Latest Return | |
| Latest 6 Months | |
| Latest 12 Months | |
| Latest 24 Months | |
| Annualised Since Inception | |
| Inception Date | |
| FUM (millions) | |
| Fund Overview | JCBAF seeks to establish a mid to long term core portfolio using both domestic and global macroeconomic analysis. This is overlaid with a number of valuation indicators and international market intelligence from a global network of market moving investors, including central bankers and hedge funds, to construct an optimal indexed portfolio allocation at any given time. The Fund recognises short term oscillations driven by technical factors and supply dynamics create opportunities within short term pricing cycles, which can generate significant alpha when managed within a risk adjusted framework. The Fund aims to outperform its index using duration and curve management at appropriate times in the pricing cycle whilst retaining a core long. The JCB Active Fund gives direct access to the management team whilst providing portfolio balance with increased capital stability and a fixed income streams with both income and principle repayment secured by the Australian or State Governments. |
| Manager Comments | The portfolio was positioned cautiously over the Christmas and New Year period, lowering fund duration and setting up for maximum roll and carry over the holiday break. Over the month the fund held an average duration position of 4.21 years which resulted in material under performance, given the benchmark's larger weighting at 5.80 years duration, but volatility provided some excellent opportunities to adjust duration over the month. Click below to read the Fund Manager's market outlook. |
| More Information |
4 Feb 2016 - Fund Review: Supervised High Yield Fund December 2015
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 32years, 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.
Supervised High Yield Fund AFM Review December 2015 (pdf format)
3 Feb 2016 - Fund Review: Insync Global Titans Fund December 2015
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 returned -1.90% for the month of December. The performance was driven by positive contributions from our holdings in Medtronic, Microsoft, McDonald's and Roche. The main negative contributors were Oracle, Time Warner and Comcast. 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.
2 Feb 2016 - Fund Review: QATO Capital Market Neutral Long/Short Fund December 2015
QATO Capital Market Neutral Long/Short Fund
Attached is our most recently updated Fund Review on the QATO Capital Market Neutral Long/Short Fund.
We would like to highlight the following aspects of the Fund;
- Qato Capital is a Melbourne-based boutique fund manager backed by single family office, Larkfield Funds Management.
- Qato has a systematic, market-neutral strategy which invests exclusively in S&P/ASX 100 stocks.
- The QATO Capital's Q-score process captures and quantifies six broad fundamental factors, which assess multiple underlying sub-categories. Those companies with the top score (quality companies) are included in the "long" portfolio, those with the lowest score are sold short.
- The Fund seeks to preserve capital and maximise absolute returns through active and constant risk management, targeting monthly a net market exposure of 0% to hedge broader market risks through 30 S&P/ASX-100 positions (15 long & 15 short equally-weighted positions).
- Qato Capital's process is entirely systematic - stock selection and risk management are employed in a rules based approach. The Fund employs no financial leverage/gearing to purchase securities, no derivatives and no financial products to imitate leverage.
Qato Capital AFM Fund Review December 2015 (pdf format)
1 Feb 2016 - Fund Review: Jamieson Coote Bonds Active Fund December 2015
Jamieson Coote Bonds Active Fund
Attached is our most recently updated Fund Review on the Jamieson Coote Bonds Active Fund
We would like to highlight the following aspects of the Fund;
- Jamieson Coote Bonds is a Melbourne-based Boutique Manager launched in December 2014.
- The Founders, Charles Jamieson and Angus Coote bring over 30 years of international experience dealing with central banks, hedge funds and real money managers.
- The Jamieson Coote Active Bond Fund is a long-only macroeconomic investment fund, investing in Australian Dollar denominated bonds backed by AAA and AA+ rated Government, Semi (State) Government and Supranational agencies.
- The Fund Objective is to out-perform the Bloomberg Australian Government Bond Index through active management in a sound risk-framework and usually holds around 20 bond securities of varying maturities.
JCBAF AFM Fund Review December 2015 (pdf format)
30 Jan 2016 - Hedge Clippings
Welcome back - but not to a great start to the New Year!
Not a great start to the New Year is probably an understatement in anyone's language. Whether it is equity prices across the globe, commodity prices, a refugee crisis in Europe threatening widespread economic, security and social problems, or the Chinese authorities hamfisted approach to stablising markets, the news has been dismal to say the least - unless you're a motorist filling the car at a nearby petrol station, or taking advantage of lower airline prices.
At the current time the ASX200 is down around 5.5% since the start of the year, for a fall of around 12.5% over the past 12 months, having at one stage during the month looked even worse. Ugly to say the least, and while not wishing to forcast more gloom and doom, it does seem that volatility will remain entrenched across the globe for some time to come. To what extent the US rate rise late last year has had anything to do with equity market weakness in difficult to fathom given it has been clouded, or at least overshadowed by the exteme volatility and weakness in Chinese markets.
So if we can't (or don't want to) forcast the future beyond the obvious, let's look back at the previous year, as we usually do at this time: Over the 12 months to December 2015 the ASX200 absolute return struggled to gain 2.56%, while excluding dividends the ASX200 recorded a loss of -2.13%. Probably the only reason it performed as well as it did was the unquenchable thirst for yield that those two statistics indicate.
Over the other side of the Pacific the S&P500 fell -1.58% or on an accumulation basis it rose a paltry 1.38%.
Not unsurpisingly the Equity based hedge and absolute return fund sector out-performed underlying markets significantly - with the average performance of all funds in AFM's database (unweighted for size) up 12.49%. Non equity funds, including credit, fixed income, commodites and FX for example, fared less well, but still managed a return of just over 4% for the year. Almost 80% of all funds - equity and non equity - outperformed the ASX200, and only 12% finished the year in negative territory.
As usual the spread of performances was dramatic, and after stripping out the top and bottom 1% of funds, ranged from -10% to +55%. From a strategy perspective equity based funds such as Market Neutral (+14.82%), Active Long Only (+14.2%), Long/Short (+13.22%), and 130/30 (+10.34%) all performed well, while at the other end of the scale, only two strategies, Commodities/CTA and Managed Futures, averaged negative returns.
Some highlights are shown below, or for full details follow the link to www.fundmonitors.com
Performance updates and reviews received this over the past couple of weeks included the following PERFORMANCE UPDATES:
Bennelong Long Short Equity Fund rose 6.22% in December, to bring latest 12-month return to 37.14%.
For the month of December, the Meme Australian Share Fund gained 4.40% compared to the ASX200 Accumulation Index's return of 2.73%, an outperformance of 1.67%.
Optimal Australia Absolute Trust recorded net return of -0.1% to bring the year 2015's return to +8.05%.
The Paragon Fund returned 0.3% for the month of December, to take latest 12 month return to 16.44%.
Bennelong Kardinia Absolute Return Fund rose 1.74% in December, to bring annualised performance since inception 12.74% p.a.
Totus Alpha Fund rose 4.5% net of fees in December taking the latest 12 month return to 53.40%.
NWQ Fiduciary Fund returned +2.22% for the month of December, to bring latest 12 month return to 17.18%.
Pengana Absolute Return Asia Pacific Fund rose 0.72% for the month, outperforming the HFR Event Driven Index which closed down -0.9%, by 1.62%.
Signature Quantitative Fund rose 2.50% for the month of December, to bring annualised performance since inception to 10.40% p.a.
Morphic Global Opportunities Fund returned -2.48% in December to bring latest 12 month return to 9.08%.
APN Asian REIT Fund returned -0.48% in December. Since inception, the Fund has an annualised return of 15.97% p.a.
Freehold Absolute Return Fund delivered a positive 1.95% for the month of December.
Jamieson Coote Bonds Active Fund rose 0.25% in December.
APN AREIT Fund rose 4.67% in December to bring annualised return since inception to 17.73% p.a.
Laminar Credit Opportunities Fund returned +0.66% for the month of December.
Qato Capital Market Neutral Long/Short Fund rose 2.70%, compared to the S&P/ASX 100 Price Index, which returned 2.40%.
Supervised High Yield Fund produced a return of +0.37% for the month of December, to bring annualised performance since inception to 9.68% p.a.
Insync Global Titans Fund returned -1.90% for the month of December, to take the latest 24 months to 18.72%.
KIS Asia Long Short Fund rose 2.90% for December, outperforming the AFM Asia Pacific ex-Japan Index by 4.32%
FUND REVIEWS released this week: Meme Australian Share Fund; Bennelong Long Short Equity Fund; Optimal Australia Absolute Trust; Bennelong Kardinia Absolute Return Fund; Totus Alpha Fund; Morphic Global Opportunities Fund; Pengana Absolute Return Asia Pacific Fund; APN Asian REIT Fund
And on that happy note it's good to be back, and as always I trust you have a safe and enjoyable week-end.
Regards,
Chris
CEO, AUSTRALIAN FUND MONITORS
Connect with me on LinkedIn Twitter Facebook
|
Registration to AFM is free and provides general information and performance data on Absolute Return, Hedge Funds and Alternative Investments. |
Fund Managers and paid Subscribers have access to details on Individual Managers and Funds, with historical results, key performance indicators, latest news and performance reports. |
Prism Select provides self-directed investors and their advisors with factual information, performance data and opportunity to apply for funds online using OLIVIA123. |
Tune into Sky Business on Foxtel every week on Monday at 2:15pm for AFM's weekly comment. |
Australian Fund Monitors are helping to raise awareness to support research into prevention and cure for cerebral palsy. For more information visit www.cpresearch.org.au or contact me by email.
