The Bennelong Long Short Equity Fund lost -1.72% in March after posting strong gains in January and February. The 2009 return for the Fund now stands at +12.06%.
Like many equity based funds that employ short selling, the Fund suffered from the strong rally in global equity markets in March. As the Fund has been defensively positioned in recent months due to economic uncertainty, and the rally focused on buying back undersold/value sectors (financials and cyclical stocks) at the expense of defensive stocks, the Fund's return suffered accordingly. The manager however believes it is not yet clear that economic conditions will continue to improve, so will keep the Fund's portfolio defensive in the short term.
The biggest positive contributors to March's result were long Ansell/short Resmed and long Onesteel/short Bluescope spreads, the biggest losses coming from long Incitec/short Orica and long JB Hi-Fi/short Harvey Norman.
