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Performance Report: Delft Partners Global High Conviction
2 Feb 2021 - Australian Fund Monitors
The Delft Global High Conviction Strategy has returned +14.68% p.a. with an annualised volatility of 11.81% p.a. since inception in August 2011. By contrast, AFM's Global Equity Index has returned +13.86% p.a. with an annualised volatility...
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2 Feb 2021 - Performance Report: Delft Partners Global High Conviction
By: Australian Fund Monitors
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| Fund Overview | The quantitative model is proprietary and designed in-house. The critical elements are Valuation, Momentum, and Quality (VMQ) and every stock in the global universe is scored and ranked. Verification of the quant model scores is then cross checked by fundamental analysis in which a company's Accounting policies, Governance, and Strategic positioning is evaluated. The manager believes strategy is suited to investors seeking returns from investing in global companies, diversification away from Australia and a risk aware approach to global investing. It should be noted that this is a strategy in an IMA format and is not offered as a fund. An IMA solution can be a more cost and tax effective solution, for clients who wish to own fewer stocks in a long only strategy. |
| Manager Comments | The Portfolio returned -0.9% in December. Delft highlighted that, following the results of the US election, the yield curve is steepening as fiscal spending is now likely to accompany ultra low interest rates which they noted typically leads to change in market leadership - Delft currently favour small and value. Delft remain very diversified, with underweight positions in banks and oils and overweight positions in 'true technology' companies and healthcare. Delft like Japan and Asia on valuation, fiscal resilience and improving governance. They see a poor outlook for European profits notwithstanding the 'cheap' market. Notable performers in the portfolio included AES (a US utility company, Shin-Etsu Chemical (Japanese high-end chemicals company), and Discovery (US provider of documentary content). Alibaba fell as investors worried about political interference, and Intel was hit by announcements regarding increased in-sourcing by Apple and Microsoft. The Strategy remains unhedged for AUD$ based investors. |
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Performance Report: Bennelong Twenty20 Australian Equities Fund
2 Feb 2021 - Australian Fund Monitors
The Bennelong Twenty20 Australian Equities Fund rose +2.59% in December, outperforming the ASX200 Accumulation Index by +1.53% and taking CY20 performance to +12.62% vs the Index's +1.40%. Since inception in November 2009, the Fund has...
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2 Feb 2021 - Performance Report: Bennelong Twenty20 Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is managed as one portfolio but comprises and combines two separately managed exposures: 1. An investment in the top 20 stocks of the markets, which the Fund achieves by taking an indexed position in the S&P/ASX 20 Index; and 2. An investment in the stocks beyond the S&P/ASX 20 Index. This exposure is managed on an active basis using a fundamental core approach. The Fund may also invest in securities expected to be listed on the ASX, securities listed or expected to be listed on other exchanges where such securities relate to ASX-listed securities.Derivative instruments may be used to replicate underlying positions and hedge market and company specific risks. The companies within the portfolio are primarily selected from, but not limited to, the S&P/ASX 300 Accumulation Index. The Fund typically holds between 40-55 stocks and thus is considered to be highly concentrated. This means that investors should expect to see high short-term volatility. The Fund seeks to achieve growth over the long-term, therefore the minimum suggested investment timeframe is 5 years. |
| Manager Comments | As at the end of December, the portfolio's weightings had been increased in the Communication, IT, Consumer Staples and Materials sectors, and decreased in the Discretionary, Industrials, Health Care, Financials and REIT's sectors. The portfolio is significantly overweight the Discretionary sector (Fund weight: 32.4%, benchmark weight: 7.7%). |
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Performance Report: Quay Global Real Estate Fund
2 Feb 2021 - Australian Fund Monitors
The Quay Global Real Estate Fund has returned +6.81% p.a. with an annualised volatility of 11.84% since inception in January 2016. The Fund's underlying investees rallied into Christmas along with other risk assets, however, the headwinds...
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2 Feb 2021 - 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 | Key positive contributors included Brixmor (US retail) and Whart REIC (Hong Kong retail). US apartments (Essex, Mid-America) were among the performance drags, along with Hysan (Hong Kong diversified). The Fund returned -9.8% over CY20 which Quay noted was disappointing, however, in constant currency terms the underlying investees delivered a return of -1.2%. This indicates that almost all of the negative returns this year were currency related. Quay added that this return should be seen in light of the extraordinary cost the real estate industry was asked to bear during the pandemic, essentially being asked to shut down, forgive or forgo rent, and in some jurisdictions prevented from evicting tenants whether they had the ability to pay rent or not. As was the case after the GFC in 2009, Quay believe attractive long-term total returns are available for investors in global listed real estate. Unlike 2009, they don't believe it is available across all sectors. They believe the best opportunities are those with mispriced quality real estate, with strong balance sheets, sensible dividend payout policies and best-in-class management. |
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Performance Report: AIM Global High Conviction Fund
1 Feb 2021 - Australian Fund Monitors
The AIM Global High Conviction Fund rose +14.19% with a volatility of 11.43% over the past 12 months vs AFM's Global Equity Index's return of +6.21% with a volatility of 13.98%. Since inception in July 2015, the Fund has returned +4.61%...
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1 Feb 2021 - Performance Report: AIM Global High Conviction Fund
By: Australian Fund Monitors
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| Fund Overview | The strategy is long-only, with a mandate to be between 90% - 100% invested. The Fund also employs a construction framework that ensures there is a sensible mix of exposures within the limited number of businesses in the portfolio. These limits are: - Maximum individual position size 7.5% - Minimum individual position size 2.5% - Maximum sector exposure 30% The Fund targets a cash allocation of between 0-10% but can have as much as 20% of the portfolio in cash in the event of an unprecedented global shock. Liquidity is extremely important. The Fund will typically look to invest in businesses within a market cap range of US$7.5billion all the way up to the largest companies in the world with market capitalisations in excess of $200b. Occasionally, we may find a business that exhibits the traits of a quality investment, but it is much earlier in its business cycle. The Fund can invest in these businesses, but they must clear a much higher bar for inclusion. Individually, these future compounders cannot comprise more than 4% of the fund, these businesses cannot collectively exceed 10% of the fund. |
| Manager Comments | The Fund returned -0.71% in December. The biggest headwind to performance during the month was the relative strength of the AUD which AIM estimate reduced the absolute return by 4.7%. The top contributors to performance included Intuitive Surgical, Keyence, PayPal, LVMH and Estee Lauder. Key detractors included Salesforce.com, Alphabet, Prosus, Fastenal and ICON. AIM noted that in most cased (except Salesforce), the decline in local currency was relatively modest. The weak AUD returns were driven by the currency impact. The portfolio's top 10 holdings at month-end were Berkshire Hathaway, Microsoft Corp, Coca-Cola, Alphabet, Mastercard, UnitedHealth Group, ICON, Accenture, Nike and Heineken NV. The portfolio was most heavily weighted towards the USA (43.6% of the portfolio), followed by developed ex-USA markets (25.8% weighting). By sector, the portfolio was most heavily weighted towards the IT, Consumer Discretionary, Consumer Staples and Healthcare sectors. |
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Performance Report: Bennelong Concentrated Australian Equities Fund
1 Feb 2021 - Australian Fund Monitors
The Bennelong Concentrated Australian Equities Fund rose +1.74% in December, taking 12-month performance to +16.33% vs the ASX200 Accumulation Index's +1.40%. Since inception in February 2009, the Fund has returned +16.65% p.a. vs the Index's 9.99%.
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1 Feb 2021 - 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 | The Fund's up-capture and down-capture ratios (since inception), 149.4% and 91.6% respectively, indicate that, on average, it has outperformed in both the market's positive and negative months. The Fund's Sortino ratio (since inception) of 1.36 vs the Index's 0.73 demonstrates its capacity to avoid the market's downside volatility over the long-term. As at the end of December, the portfolio's weightings had been increased in the IT, Communication, Industrials, Materials and Financials sectors, and decreased in the Discretionary, Health Care and REIT's sectors. The portfolio is significantly overweight the Discretionary sector (Fund weight: 39.8%, benchmark weight: 7.7%) and underweight the Financials sectors (Fund weight: 7.1%, benchmark weight: 27.1%). |
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Performance Report: Insync Global Capital Aware Fund
1 Feb 2021 - Australian Fund Monitors
The Insync Global Capital Aware Fund rose +19.71% over CY20, outperforming AFM's Global Equity Benchmark by +13.5% with the same level of volatility. Since inception in October 2009, the Fund has returned +11.94% p.a. vs the Index's +11.14%.
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1 Feb 2021 - Performance Report: Insync Global Capital Aware Fund
By: Australian Fund Monitors
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| Fund Overview | Insync employs four simple screens to narrow the universe of over 40,000 listed companies globally to a focus group of high quality companies that it believes have the potential to consistently grow their profits and dividends. These screens are size of the company, balance sheet performance, valuation and dividend quality. Companies that pass this due diligence process are then valued using dividend discount models, free cash flow yield and proprietary implied growth and expected return models. The end result is a high conviction portfolio of typically 15-30 stocks. The principal investments will be in shares of companies listed on international stock exchanges (including the US, Europe and Asia). The Fund may also hold cash, derivatives (for example futures, options and swaps), currency contracts, American Depository Receipts and Global Depository Receipts. The Fund may also invest in various types of international pooled investment vehicles. At times, Insync may consider holding higher levels of cash if valuations are full and it is difficult to find attractive investment opportunities. When Insync believes markets to be overvalued, it may hold part of its resources in cash, or use derivatives as a way of reducing its equity exposure. Insync may use options, futures and other derivatives to reduce risk or gain exposure to underlying physical investments. The Fund may purchase put options on market indices or specific stocks to hedge against losses caused by declines in the prices of stocks in its portfolio. |
| Manager Comments | The Fund's return was flat in December, in line with the Index. Insync believe the outperformance of neglected sectors over the past quarter (e.g. banks, energy & cyclicals) is primarily due to exuberant expectations of much higher growth (from vaccines) and inflation views for the near term. Insync noted Megatrends have proved resilient to the COVID-19 fallout, with many existing long-term trends having been accelerated by the pandemic. These include the move to e-commerce, uptake of contactless payment methods, expansion of cloud-based services, collision of biological science technology and the transition from carbon energy to electric. They added that megatrends are typically not determined by short-term shocks, even those as significant as COVID-19. The Fund's top 10 active holdings at month-end included Nintendo, Walt Disney, Domino's Pizza, PayPal, Dollar General, Qualcomm, Visa, S&P Global, Facebook and Nvidia. |
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Performance Report: Premium Asia Fund
29 Jan 2021 - Australian Fund Monitors
The Premium Asia Fund rose +5.28%, outperforming AFM's Asia Pacific ex-Japan Index by +3.37% and taking 12-month performance to +23% vs the Index's +13.58%. Since inception in December 2009, the Fund has returned +12.49% p.a. vs the Index's +6.46%.
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29 Jan 2021 - Performance Report: Premium Asia Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is managed by Value Partners using a disciplined value-oriented approach supported by intensive, on-the-ground bottom-up fundamental research resulting in a portfolio of individual holdings, which are, in the view of Value Partners, undervalued and of high quality, on either an absolute or relative basis, and which have the potential for capital appreciation. The Fund will primarily have exposure to the equity securities of entities listed on securities exchanges across the Asia (ex-Japan) region, however, the Fund may also gain exposure to entities listed on securities outside the Asia (ex-Japan) region which have significant assets, investments, production activities, trading or other business interests in the Asia (ex-Japan) region as well as unlisted instruments with equity-like characteristics, such as participatory notes and convertible bonds. The Fund may also invest in cash and money market instruments, depositary receipts, listed unit trusts, shares in mutual fund corporations and other collective investment schemes (including real estate investment trusts), derivatives including both exchange-traded and OTC, convertible securities, participatory notes, bonds, and foreign exchange contracts. |
| Manager Comments | Within China, the Fund's core consumption related holdings extended the positive momentum to December. In particular, Premium China noted a Chinese e-commerce platform is expected to maintain a robust growth outlook heading into 2021, while the baiju holdings continued to enjoy robust demand and price hikes. Another key contributor was China's leading duty-free shop operator, which Premium China recently added to the portfolio. The company benefits from favourable government policies and the reshoring consumption trend. Technology hardware also showed no sign of deceleration. This resulted in another month of strong performance from the Fund's top holdings in Taiwan's largest semiconductor foundry and the world's leading Korean flash memory chip maker. As a result, the two companies continue to be the top performers in the portfolio. Premium China's view is that the outlook for 2021 equities is benign under accommodative policy, recovering earnings, and nascent vaccine adoption. They added that Asian equities, especially China-related companies, are expected to lead the growth. They expect profit growth derived from old and new economy sectors to be more balanced this year. |
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Performance Report: Frazis Fund
29 Jan 2021 - Australian Fund Monitors
The Frazis Fund rose +8.50% in December, outperforming AFM's Global Equity Index by +8.66% and taking CY20 performance to +108.43% after fees vs the Index's +6.21%. Since inception in July 2018, the Fund has returned +31.00% p.a. vs the...
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29 Jan 2021 - Performance Report: Frazis Fund
By: Australian Fund Monitors
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| Fund Overview | The manager follows a disciplined, process-driven, and thematic strategy focused on five core investment strategies: 1) Growth stocks that are really value stocks; 2) Traditional deep value; 3) The life sciences; 4) Miners and drillers expanding production into supply deficits; 5) Global special situations; The manager uses a macro overlay to manage exposure, hedging in three ways: 1) Direct shorts 2) Upside exposure to the VIX index 3) Index optionality |
| Manager Comments | The Fund has achieved an up-capture ratio since inception of 262.4% which indicates that, on average, the Fund has risen more than twice as much as the market during the market's positive months. The Fund's 12-month up-capture ratio is 617.5%, highlighting its significant outperformance during the market's positive months over CY20. The Fund now holds over 45 stocks. Frazis noted many of these are growing in excess of 100%, and on a weighted average basis growing at over 80% organically. They highlight that, instead of focusing on historic financials, they focus first on consumers and the key decision points when one product or service is chosen over another. They look for explosive growth measurable in data and consider true 'customer love' and a rapidly growing and increasingly engaged userbase as the real sign of quality. Heading into 2021, Frazis remain confident the portfolio will continue to outperform. |
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Performance Report: Montgomery Small Companies Fund
29 Jan 2021 - Australian Fund Monitors
The Montgomery Small Companies Fund rose +3.65% in December, outperforming the ASX200 Accumulation Index by +2.59% and taking 12-month performance to +27.56% vs the Index's +1.40%.
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29 Jan 2021 - Performance Report: Montgomery Small Companies Fund
By: Australian Fund Monitors
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| Fund Overview | Montgomery Lucent, a joint venture between Lucent Capital Partners and Montgomery Investment Management, is the investment manager of the Fund. Lucent Capital Partners is owned by its founders Gary Rollo and Dominic Rose. Gary and Dominic have worked together for three years as at February 2020 and have a combined three decades of portfolio management and equities research experience. The manager is able to invest up to 10% of the portfolio in pre-IPO opportunities. They search for companies likely to benefit from secular trends, industry change and with substantial competitive advantages. Cash typically ranges around 10%. |
| Manager Comments | The Montgomery Small Companies Fund rose +3.65% in December, outperforming the ASX200 Accumulation Index by +2.59% and taking 12-month performance to +27.56% vs the Index's +1.40%. Since inception in October 2019, the Fund has returned +20.16% p.a. vs the Index's +1.67%. The Fund's up-capture and down-capture ratios for performance over the past year, 165.6% and 88.3% respectively, indicate that, on average, the Fund outperformed in both the market's positive and negative months. Positive contributors in December included City Chic Collective, EML Payments and Mineral Resources. The largest detractors included Appen, Tyro Payments and Webjet. Montgomery noted they're entering 2021 playing five big themes; cloud technology, sustainable income, economic reopening, strength and stimulus, and de-carbonisation. These themes are discussed in detail in the latest report. |
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Performance Report: DS Capital Growth Fund
29 Jan 2021 - Australian Fund Monitors
The DS Capital Growth Fund rose +4.27% in December, taking CY20 performance to +19.91% vs the ASX200 Accumulation Index's +1.40%. Since inception in January 2013, the Fund has returned +16.05% p.a. with an annualised volatility of 11.45%.
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29 Jan 2021 - Performance Report: DS Capital Growth Fund
By: Australian Fund Monitors
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| Fund Overview | The investment team looks for industrial businesses that are simple to understand; they generally avoid large caps, pure mining, biotech and start-ups. They also look for: - Access to management; - Businesses with a competitive edge; - Profitable companies with good margins, organic growth prospects, strong market position and a track record of healthy dividend growth; - Sectors with structural advantage and barriers to entry; - 15% p.a. pre-tax compound return on each holding; and - A history of stable and predictable cash flows that DS Capital can understand and value. |
| Manager Comments | The following statistics (since inception) highlight the Fund's capacity to outperform in falling and volatile markets: Sortino ratio of 1.82 vs the Index's 0.67, average negative monthly return of -2.01% vs the Index's -3.14%, and down-capture ratio of 45%. The Fund delivered +11.50% over the December quarter. Key positive contributors included Resimac, Uniti Group, Money3, Kogan and SG Fleet. DS Capital expect COVID-19 to be the dominant influence on asset markets going into 2021. They added that, while it is expected that stimulus and low interest rates will continue in the near-term, any change to this expectation will create volatility. |
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