Bubble Bubble, Toil and Trouble.
Hedge Clippings is probably not the only party to be frustrated by what has broadly been portrayed as "debate" about the upcoming budget, or for that matter the overall political stand-off that now seems to be the norm in Australia.
With Parliament due to resume next week, and the budget now only a few weeks away, we hope things will become a little bit clearer. However what seems to be abundantly clear is that while everyone understands that as a nation we are living beyond our means, the reality is that the only way to fix it is to either reduce expenditure, or increase revenue.
It really doesn't matter whether this is applied at the household, corporate or government level, the rules remain the same. Unfortunately at government level reducing expenditure translates into either reduced welfare, or reduced services such as health and education. Meanwhile increasing revenue translates into higher taxation, or a reduction of various tax breaks.
Under the Abraham Lincoln political rule that you can "please some of the people all of the time, or all of the people some of the time, but you can't please all of the people all of the time," whatever is handed down in this year's budget is going to disappoint. Everyone wants more, while no one wants to give up what they've already got.
Added to that is the problem that the Turnbull government, which kicked off with so much optimism, seems to have been backed into a corner of having to rule out most budget options before they started. We guess the PM will be ruing the day that he didn't take over and call an early (read "immediate") election last November, and use the following three years to get on with it. We certainly are.
Finally this week the IMF downgraded forecasts for world economic growth, while interestingly also being a bit more optimistic about China's outlook. We take this news with a pinch of salt, as the IMF's track record for economic fortune telling hasn't been too good over the years. Whether it's the economic models they are using, or the possibility that they are cocooned in ivory towers, it's a long time (if ever) since the IMF predicted world economic growth accurately, instead consistently having to downgrade their previous forecasts as they catch up to the real world economy.
Meanwhile as markets, particullary in Australia, seem to continue to see-saw, some March fund results came in as follows:
Meme Australian Share Fund returned a positive 3.38% to take their latest 12 months return to 9.20%.
Pengana Absolute Return Asia Pacific Fund finished up +1.68% for the month, compared to the HFR Event Driven Index which rose +2.6%.
The Paragon Fund rose an impressive 7.40% for the month to take annualised return since inception to 17.13% p.a.
Optimal Australia Absolute Trust recorded a positive 2.30% to take prior 12 months return to 12.59%.
Bennelong Kardinia Absolute Return Fund returned +0.30% to take annual returns since inception to 11.83% p.a.
APN Asian REIT Fund returned -2.70%, compared to the BBAREIT Index's return of -4.29%, to give an outperformance of 1.59%.
Cyan C3G Fund fell 3.38% to take latest 12 months return to 27.86%, after posting a gain of 48% in calendar 2015.
Bennelong Long Short Equity Fund returned -6.73% to take 12 month performance to 22.71% with annual returns since inception of 17.81% p.a.
Supervised High Yield Fund returned a positive 0.20% for the month of February, to bring annualised performance since inception to 9.39% p.a., Standard Deviation of 2.1% and a Sharpe Ratio of 2.86.
FUND REVIEWS released this week: Meme Australian Share Fund; Morphic Global Opporunities Fund; Bennelong Long Short Equity Fund; Insync Global Titans Fund; QATO Capital Market Neutral Long/Short; Supervised High Yield Fund;
And on that note, have a great 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 at the new time of10:45 am on Friday'sfor 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.
