Water Infrastructure in China

21 Jan 2020 - Kevin Smith - Delft Partners

Kevin Smith takes a look at the development of water management infrastructure in China and key listed company in the sector, plastic pipe manufacturer China Lesso Group Holdings Limited.

Performance Report: Cyan C3G Fund

20 Jan 2020 - Australian Fund Monitors

The Cyan C3G Fund rose +19.54% over CY19, taking annualised performance since inception in August 2014 to +18.14% versus the ASX200 Accumulation Index's +7.89%.

20 Jan 2020 - Performance Report: Cyan C3G Fund

By: Australian Fund Monitors

Report Date	20 January 2020
Manager	Cyan Investment Management
Fund Name	Cyan C3G Fund
Strategy	Equity Long
Latest Return Date	December 2019
Latest Return	-4.19%
Latest 6 Months	4.32%
Latest 12 Months	19.54%
Latest 24 Months (pa)	1.61%
Annualised Since Inception	18.14%
Inception Date	24 July 2014
FUM (millions)	AU$38
Fund Overview	The Cyan C3G Fund operates as a wholesale unregistered managed investment scheme under a unit trust structure. The Fund primarily invests in ASX listed companies outside the ASX 100 and typically holds between 15-35 stocks. Cyan C3G Fund is based on the investment philosophy which can be defined as a comprehensive, clear and considered process focused on delivering growth. These are identified through stringent filter criteria and a rigorous research process. The Manager uses a proprietary stock filter in order to eliminate a large proportion of investments due to both internal characteristics (such as gearing levels or cash flow) and external characteristics (such as exposure to commodity prices or customer concentration). Typically, the Fund looks for businesses that are one or more of: a) under researched, b) fundamentally undervalued, c) have a catalyst for re-rating. The Manager seeks to achieve this investment outcome by actively managing a portfolio of Australian listed securities. When the opportunity to invest in suitable securities cannot be found, the manager may reduce the level of equities exposure and accumulate a defensive cash position. Whilst it is the company's intention, there is no guarantee that any distributions or returns will be declared, or that if declared, the amount of any returns will remain constant or increase over time. The Fund does not invest in derivatives and does not use debt to leverage the Fund's performance. However, companies in which the Fund invests may be leveraged.
Manager Comments	The Cyan C3G Fund rose +19.54% over CY19, taking annualised performance since inception in August 2014 to +18.14% versus the ASX200 Accumulation Index's +7.89%. The Fund's Sharpe and Sortino ratios for performance since inception, 1.38 and 2.71 respectively, by contrast with the Index's Sharpe of 0.60 and Sortino of 0.83, highlight the Fund's capacity to achieve superior risk-adjusted returns whilst avoiding the market's downside volatility over the long-term. Despite pulling back -4.2% in December and -8.8% over Q4, the Fund ended CY19 up +19.5%. Cyan put the recent retracement down to a lack of momentum resulting in smaller stocks being sold off aggressively for no particular fundamental reason, and widespread forced selling of smaller cap ASX stocks due to a number of bigger institutional funds pulling large mandates from Cyan's competitors. During December the Fund generated some strong positive performance from three recent IPO's - Carbon Revolution (CBR), Aerometrix (AMX) and Amearo (3DA). Key detractors included Alcidion (ALC), Atomos (AMS), Quickstep (QHL), Oventus (OVN), Readcloud (RCL), Victory Offices (VOL) and Jaxsta (JXT). So far in January 2020 the Fund has already pared back more than half its December losses. Cyan's view is that, on the whole due to little negative underlying news, the new year is starting from an attractive base and they hold good hopes for another profitable year in 2020.
More Information	Fund Profile Manager's Report

Hedge Clippings | 17 January 2020

17 Jan 2020 - Australian Fund Monitors

Welcome back to a New Year, and depending on your level of pedantry, a new decade. We did notice a few grumbles in the media that technically we're not in the new decade yet, but as far as a simple-minded Hedge Clippings is concerned, we...

17 Jan 2020 - Hedge Clippings | 17 January 2020

By: Australian Fund Monitors

Hedge Clippings | Friday 17 January, 2020

Welcome back to a New Year, and depending on your level of pedantry, a new decade. We did notice a few grumbles in the media that technically we're not in the new decade yet, but as far as a simple-minded Hedge Clippings is concerned, we now write the date with a 20 in front (or behind) it, so a new decade it is.

We closed the last edition of Hedge Clippings with a summary of 2019, so it is only natural to open this year's effort with the picture ahead of us. Firstly, however, a thought for all those affected by Australia's bushfires which, for the time being at least, seem to have subsided. Although, there's a long way to go yet, not only for the remainder of this summer, but the years and decades beyond.

Much like 2019 we would expect 2020 to be dominated by geopolitics with a US election, the real Brexit, Putin and Xi all featuring heavily. Effectively, whilst we may think Australia is on the world stage, that means this year remains in the hands of four people of different persuasions, and different levels of political control domestically and globally.

Economically we wouldn't expect global interest rates to change much either way, although the US economy is showing signs of strength this may not translate into higher inflation - yet. Domestically, however, we're facing bushfire induced headwinds - both economically and politically.

From the perspective of investors and their advisors in managed funds, this year is once again going to be a challenge, met with varying levels of success by fund managers as always. 2019 was a stellar year, particularly for global equities (thanks to Donald and low interest rates) and in Australia the small to mid-cap sector. Short of a market shock, expect more of the same, and for the fund managers themselves, the same challenges.

In coming weeks once all funds have reported their December returns we will be providing data on the winners and losers from 2019. In the meantime, below is a roundup of reports received to date, and manager insights.

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Performance Report: Paragon Australian Long Short Fund

17 Jan 2020 - Australian Fund Monitors

The Paragon Australian Long Short Fund outperformed the ASX200 Accumulation Index by +2.47% in December, taking 12-month performance to +24.69% and annualised performance since inception in March 2013 to +9.90%.

17 Jan 2020 - Performance Report: Paragon Australian Long Short Fund

By: Australian Fund Monitors

Report Date	17 January 2020
Manager	Paragon Funds Management
Fund Name	Paragon Australian Long Short Fund
Strategy	Equity Long/Short
Latest Return Date	December 2019
Latest Return	0.30%
Latest 6 Months	7.56%
Latest 12 Months	24.69%
Latest 24 Months (pa)	-12.18%
Annualised Since Inception	9.90%
Inception Date	28 February 2013
FUM (millions)	AU$35
Fund Overview	The Paragon Fund is a concentrated long/short Australian listed equities product that is fundamentally driven with a focus on the industrial and resource sectors. Paragon's unique investment style, comprising thematic led idea generation followed with an in depth research effort, results in a concentrated portfolio of high conviction stocks. Conviction in bottom up analysis drives the investment case and ultimate position sizing: * Both quantitative analysis - probability weighted high/low/base case valuations - and qualitative analysis - company meetings, assessing management, the business model, balance sheet strength and likely direction of returns - collectively form Paragon's overall view for each investment case. * Paragon will then allocate weighting to each investment opportunity based on a risk/reward profile, capped to defined investment parameters by market cap, which are continually monitored as part of Paragon's overall risk management framework. The objective of the Paragon Fund is to produce absolute returns in excess of 10% p.a. over a 3-5 year time horizon with a low correlation to the Australian equities market.
Manager Comments	The Paragon Australian Long Short Fund outperformed the ASX200 Accumulation Index by +2.47% in December, taking 12-month performance to +24.69% and annualised performance since inception in March 2013 to +9.90%. By contrast, the Index has returned +23.40% over the past 12 months and +8.65% p.a. since the Fund's inception. The Fund's down-capture ratio for performance over the past 12 months of -26.23% and for performance since inception of 41.02% highlight the Fund's capacity to significantly outperform in falling markets. Positive contributors for December included Adriatic and Atrum (resource upgrades), offset by declines in Audinate and Telix Pharma. In their latest report Paragon discuss the Fund's performance over the past 12 months, noting that the Fund outperformed almost all relevant indices. Their latest report also includes Paragon's 2020 outlook. In their view, many macro flags, such as central banks globally resuming quantitative easing and improvements in the US-China trade war, have turned green (from red a year ago). Around half of the Fund's exposure is in Resources (which includes the Fund's gold stocks) and the other half is in structural growth stocks across tech/medtech/fintech. Paragon anticipate near-term catalysts to drive ongoing re-ratings for many of the Fund's stocks and their performance for 2020 and beyond.
More Information	Fund Profile Manager's Report

Performance Report: NWQ Fiduciary Fund

16 Jan 2020 - Australian Fund Monitors

The NWQ Fiduciary Fund Rose +1.68% in December, outperforming the ASX200 Accumulation Index by +3.85% and taking annualised performance since inception in May 2013 to +5.72% with an annualised volatility of 4.78%.

16 Jan 2020 - Performance Report: NWQ Fiduciary Fund

By: Australian Fund Monitors

Report Date	16 January 2020
Manager	NWQ Capital Management Pty Ltd
Fund Name	NWQ Fiduciary Fund
Strategy	Multi Strategy
Latest Return Date	December 2019
Latest Return	1.68%
Latest 6 Months	6.92%
Latest 12 Months	7.92%
Latest 24 Months (pa)	2.03%
Annualised Since Inception	5.72%
Inception Date	01 May 2013
FUM (millions)	AU$67
Fund Overview	The NWQ Fiduciary Fund (Fund), managed by NWQ Capital Management, is a diversified multi-manager portfolio, modelled on NWQ's Fiduciary Model Portfolio. The principal investment objective of the Fund is to produce attractive positive returns irrespective of market direction. This is achieved through active allocations to selective fund managers that employ a variety of traditional and absolute return strategies. The Fund places emphasis on managers who demonstrate a rigorous and repeatable investment process that has delivered a strong track record. The Fund aims to produce returns after management fees and expenses of RBA Cash Rate + 4.0-5.0% p.a. over rolling five-year periods. Furthermore, the Fund aims to achieve these returns with volatility that is a fraction of the Australian equity market, in order to smooth returns for investors.
Manager Comments	The NWQ Fiduciary Fund Rose +1.68% in December, outperforming the ASX200 Accumulation Index by +3.85% and taking annualised performance since inception in May 2013 to +5.72% with an annualised volatility of 4.78%. By contrast, the Index has returned +8.53% p.a. with an annualised volatility of 10.73% over the same period. The Fund's Sharpe and Sortino ratios for performance since inception of 0.81 and 1.36 respectively highlight the Fund's emphasis on capital preservation and downside avoidance. NWQ noted market volatility was muted in December across the equity, currency and fixed income complexes. Positive reactions from investors on the US/China trade negotiations, the re-election of the Tory Government in the UK, and the additional liquidity provided by the Fed through its repo market interventions were generally supportive of global equities. The Fund's Alpha managers (+2.29% contribution) disproportionately contributed to overall performance, as is to be expected given their market neutral profile.
More Information	Fund Profile Manager's Report

Performance Report: Bennelong Long Short Equity Fund

15 Jan 2020 - Australian Fund Monitors

The Bennelong Long Short Equity Fund rose +2.36% in December, outperforming the ASX200 Accumulation Index by +4.53% and taking annualised performance since inception in February 2002 to +15.55% versus the ASX200 Accumulation Index's +8.35%.

15 Jan 2020 - Performance Report: Bennelong Long Short Equity Fund

By: Australian Fund Monitors

Report Date	15 January 2020
Manager	Bennelong Long Short Equity Management, a Bennelong boutique
Fund Name	Bennelong Long Short Equity Fund
Strategy	Equity Market Neutral
Latest Return Date	December 2019
Latest Return	2.36%
Latest 6 Months	20.21%
Latest 12 Months	15.17%
Latest 24 Months (pa)	8.66%
Annualised Since Inception	15.55%
Inception Date	01 January 2003
FUM (millions)	AU$390.6
Fund Overview	Bennelong Long Short Equity Management applies a qualitative stock selection process to construct a diversified portfolio of paired securities based on relative value. The Bennelong Long Short Equity Management strategy invests primarily in the S&P/ASX 100 and is dollar neutral at cost. 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 as a Listed Investment Company (LIC) on the ASX.
Manager Comments	The Bennelong Long Short Equity Fund rose +2.36% in December, outperforming the ASX200 Accumulation Index by +4.53% and taking annualised performance since inception in February 2002 to +15.55% versus the ASX200 Accumulation Index's +8.35%. Since inception the Fund has achieved a Sortino ratio of 1.55 versus the Index's 0.49 and a down-capture ratio of -186.2%, highlighting the Fund's capacity to significantly outperform in falling markets. During the month, 20 out of 30 pairs were profitable, with no disproportionate individual pair contribution. Almost all positive pairs derived profit from the short side and vice versa loss-making pairs were driven by the long side. Portfolio activity included the introduction of a new pair in the materials sector. The top performing pair for the month was long ALS (ALQ) / short Aurizon (AZJ), while the worst performing pair was long Brambles (BXB) / short Amcor (AMC).
More Information	Fund Profile Manager's Report

What happens if house prices go into orbit?

14 Jan 2020 - Chris Rands, Portfolio Manager, Fixed Income, Nikko Asset Management

Over the past three months the run of strong Australian house prices has continued, posting a 2% increase for the month of October. This historically high level of appreciation has only been seen a handful of times over the past 30 years;...

2020 Outlook: Australian Fixed Interest

13 Jan 2020 - Jay Sivapalan (CFA), Janus Henderson Investors

In this insights article, Jay Sivapalan, CFA at Janus Henderson Investors, gives his outlook for 2020. He discusses the key themes likely to shape markets, the opportunities and risks he sees in rates markets and some of the important...

Corporate opportunity - retirement income products always with protection

12 Jan 2020 - Gyrostat Capital Management

There is an increasing demand for retirement income products with protection and an acknowledged lack of product. New products need to address market risk, sequencing risk and liquidity (Financial System Inquiry 2014,...

How to Upload an Insights Article

1 Jan 2020 - Australian Fund Monitors

If you are a fund manager looking to distribute content to our users, this instruction manual will take you through the process of uploading an article via your company's dashboard.

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21 Jan 2020 - Water Infrastructure in China

20 Jan 2020 - Performance Report: Cyan C3G Fund

17 Jan 2020 - Hedge Clippings | 17 January 2020

17 Jan 2020 - Performance Report: Paragon Australian Long Short Fund

16 Jan 2020 - Performance Report: NWQ Fiduciary Fund

15 Jan 2020 - Performance Report: Bennelong Long Short Equity Fund

14 Jan 2020 - What happens if house prices go into orbit?

13 Jan 2020 - 2020 Outlook: Australian Fixed Interest

12 Jan 2020 - Corporate opportunity - retirement income products always with protection

1 Jan 2020 - How to Upload an Insights Article

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