NEWS
14 Jul 2021 - Performance Report: DS Capital Growth Fund
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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 | Over the past 12 months, the fund's volatility has been 8.01% compared with the index's volatility of 10.42%. Since inception the fund's volatility has been 11.21% vs the index's volatility of 13.67%, and over all other time periods the fund's volatility has been lower than the ASX 200 Total Return index. The fund's Sharpe ratio has ranged from a high of 3.85 over the most recent 12 months, to a low of 1 over the past 3 years. Since inception the fund's Sharpe ratio has been 1.29. The fund's Sortino ratio (which excludes volatility in positive months) has ranged from a maximum of 48.9 over the most recent 12 months, to a low of 1.32 over the past 3 years. Since inception the fund's Sortino ratio has been 1.95. The fund has an up-capture ratio ranging between 114.31% (2 years) and 72.09% (since inception), and over the most recent 12 months has provided an up-capture ratio of 110.95%. It has a down-capture ratio of 45% since inception, and ranging between 73.41% (3 years) and 15.64% (12 months). |
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13 Jul 2021 - Performance Report: Bennelong Kardinia Absolute Return Fund
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| Fund Overview | The Fund's discretionary investment strategy commences with a macro view of the economy and direction to establish the portfolio's desired market exposure. Following this detailed sector and company research is gathered from knowledge of the individual stocks in the Fund's universe, with widespread use of broker research. Company visits, presentations and discussions with management at CEO and CFO level are used wherever possible to assess management quality across a range of criteria. Detailed analysis of company valuations using financial statements and forecasts, particularly focusing on free cash flow, is conducted. Technical analysis is used to validate the Manager's fundamental research and valuations and to manage market timing. A significant portion of the Fund's overall performance can be attributed to the attention and importance given to the macro economic outlook and the ability and willingness to adjust the Fund's market risk. |
| Manager Comments | Since inception the fund's volatility has been 7.64% vs the index's volatility of 14.28%, and over all other time periods the fund's volatility has been lower than the ASX 200 Total Return index. Since inception in the months when the market was positive the fund provided positive returns 87% of the time. It has a down-capture ratio of 48.66% since inception and has experienced a maximum drawdown of -11.71% compared with the index's -47.19%. |
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13 Jul 2021 - Fund Review: Bennelong Long Short Equity Fund June 2021
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 19-years' track record and an annualised returns of 14.78%.
- The consistent returns across the investment history highlight 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 0.88 and 1.41 respectively.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - June 2021 (pdf format)
13 Jul 2021 - Why property prices should continue to climb
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Why property prices should continue to climb Roger Montgomery, Montgomery Investment Management 08 June 2021 CoreLogic has just reported that national dwelling prices rose by 2.3 per cent in May. That's an annualised rate of more than 28 per cent. And with lenders continuing to provide cheap and easy access to credit, and investors showing lots of interest, I don't see the property market cooling off any time soon. Here at Montgomery, we've always kept a close eye on the property market. By now you should know we believe access to credit ultimately determines short and medium-term property prices. On that front lending data has been strong for some time and housing credit has accelerated. Unsurprisingly, as we have previously predicted, house prices have risen. Other factors can have a 'micro-economic' effect on prices through the behaviour of buyers and sellers each weekend, but ultimately the meaningful changes in property prices are driven by credit, and immigration in the longer-term. The Commonwealth Bank of Australia (ASX:CBA) has just published property lending data, which helps paint a picture of the state of the current property market. According to the CBA economics team, new housing-related lending rose by 3.7 per cent in April to a new record high (excluding re-financing), while lending to owner-occupiers surged by 4.3 per cent and lending to investors was up by 2.1 per cent. Thank ultra-low rates for that. Interestingly, lending to first home buyers has fallen for three consecutive months and the CBA believes this reflects declining affordability. Clearly, the Australian property market is booming and the latest lending data suggests there are ample people looking for property with cheque books approved. That will continue to keep property prices supported. The CBA notes the lending mix, is shifting. First home buyers are declining while investor buying is strong and lending to owner-occupiers excluding first homebuyers rose by 7.0 per cent. According to the CBA, housing finance data is a strong leading indicator for dwelling prices. Mind you, the relationship weakened during COVID when the CBA forecast significant house price declines that never eventuated. Now prices are rising to record levels, houses are selling faster than ever and the proportion of homes exceeding asking prices is also at a record. It's all thanks to cheap, abundant and easy access to credit. The rate of price increases is quite spectacular. CoreLogic has just reported national dwelling prices rose by 2.3 per cent in May. That's an annualised rate of more than 28 per cent. Despite the surging property prices, or perhaps because prices are rising so fast, owners are reluctant to sell, resulting in listings remaining stubbornly low. According to CoreLogic again, in the three months to May there were approximately 164,000 dwelling transactions Australia-wide. During the same period however only 136,000 new properties were put up for sale. It seems potential sellers fear missing out on further price rises or being locked out altogether. Consequently, the lack of stock, itself a function of rising prices, is fuelling further price rises. For what it's worth, the termination of the RBA's Term Funding Facility at the end of June should mean bank borrowing costs for three and four year fixed rate mortgages will rise, and so will rates on those loans. That could dampen demand for loans and if it does could slow the rate of price increases for properties, particularly for owner occupiers. If investor loans and properties continue to accelerate at the expense of first home buyers, it might be possible some macro-prudential measures by APRA could be implemented. This would serve only to slow the pace of property price rises because interest rates remain ultra-low relative to history and employment, wages and economic data continues to improve. While aggregate wages might not be rising, you only need a bunch of IT or digital recruits to switch jobs for a reported 10-15 per cent wage increase to impact what happens at this weekend's auctions and ultimately impact property prices for everyone else. Funds operated by this manager: Montgomery (Private) Fund, Montgomery Small Companies Fund, The Montgomery Fund |
12 Jul 2021 - Performance Report: Premium Asia Fund
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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 | Over the past 12 months, the fund's volatility has been 7.56% compared with the index's volatility of 5.8%. Since inception the fund's volatility has been 12.73% vs the index's volatility of 10.07%. The fund has a down-capture ratio of 3.86% since inception, and ranging between 19.08% (3 years) and -65.46% (12 months). A negative down-capture ratio indicates that, on average, the fund has risen during the market's negative months. |
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12 Jul 2021 - Manager Insights | Aitken Investment Management
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Chris Gosselin, CEO of Australian Fund Monitors, speaks with Charlie Aitken, CEO & Portfolio Manager at Aitken Investment Management. The AIM Global High Conviction Fund is a long-only fund that invests in a high conviction portfolio of global stocks. The Fund has risen +25.82% over the past 12 months, and +17.78% p.a. since inception in July 2019. Its capacity to outperform in falling and volatile markets is demonstrated by its down-capture ratio (since inception) of 74% and Sortino ratio (since inception) of 3.35.
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12 Jul 2021 - Performance Report: Surrey Australian Equities Fund
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| Fund Overview | The Investment Manager follows a defined investment process which is underpinned by detailed bottom up fundamental analysis, overlayed with sectoral and macroeconomic research. This is combined with an extensive company visitation program where we endeavour to meet with company management and with other stakeholders such as suppliers, customers and industry bodies to improve our information set. Surrey Asset Management defines its investment process as Qualitative, Quantitative and Value Latencies (QQV). In essence, the Investment Manager thoroughly researches an investment's qualitative and quantitative characteristics in an attempt to find value latencies not yet reflected in the share price and then clearly defines a roadmap to realisation of those latencies. Developing this roadmap is a key step in the investment process. By articulating a clear pathway as to how and when an investment can realise what the Investment Manager sees as latent value, defines the investment proposition and lessens the impact of cognitive dissonance. This is undertaken with a philosophical underpinning of fact-based investing, transparency, authenticity and accountability. |
| Manager Comments | The fund's Sharpe ratio has ranged from a high of 1.95 over the most recent 12 months, to a low of 0.61 over the past 3 years. Since inception the fund's Sharpe ratio has been 0.61. The fund's Sortino ratio (which excludes volatility in positive months) has ranged from a maximum of 8.04 over the most recent 12 months, to a low of 0.76 over the past 3 years. Since inception the fund's Sortino ratio has been 0.77. Since inception in the months when the market was positive the fund provided positive returns 81% of the time. It has an up-capture ratio of 118.39% since inception and 111.2% over the past 12 months. Across all other time periods, it has ranged between 143.09% (2 years) and 123.74% (3 years). |
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9 Jul 2021 - Hedge Clippings | 09 July 2021
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9 Jul 2021 - Performance Report: Collins St Value Fund
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| Fund Overview | The managers of the fund intend to maintain a concentrated portfolio of investments in ASX listed companies that they have investigated and consider to be undervalued. They will assess the attractiveness of potential investments using a number of common industry based measures, a proprietary in-house model and by speaking with management, industry experts and competitors. Once the managers form a view that an investment offers sufficient upside potential relative to the downside risk, the fund will seek to make an investment. If no appropriate investment can be identified the managers are prepared to hold cash and wait for the right opportunities to present themselves. |
| Manager Comments | The fund's Sharpe ratio has ranged from a high of 4.45 over the most recent 12 months, to a low of 0.95 over the past 4 years. Since inception the fund's Sharpe ratio has been 1.01. The fund's Sortino ratio (which excludes volatility in positive months) has ranged from a maximum of 1.83 over the past 2 years, to a low of 0 over the most recent 12 months due to the fund not having had any negative returns over that period. Since inception the fund's Sortino ratio has been 1.42. Since inception in the months when the market was positive the fund provided positive returns 84% of the time. It has an up-capture ratio ranging between 184.93% (2 years) and 87.46% (since inception), and over the most recent 12 months has provided an up-capture ratio of 185.28%. |
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9 Jul 2021 - Webinar Recording: Private Equity
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Chris Gosselin, CEO of Australian Fund Monitors, speaks with Michael Tobin, Managing Director of Vantage Asset Management about the Private Equity market and why it has consistently outperformed listed markets over the past 15 years.
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