NEWS
Pengana Absolute Return Asia Pacific Fund
18 Jan 2017 - Australian Fund Monitors
Pengana Absolute Return Asia Pacific Fund finished up +0.37% for the month of December 2016, compared to Asia Pacific markets which fell -0.46% for the month and -3.4% for the final quarter of 2016.
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18 Jan 2017 - Pengana Absolute Return Asia Pacific Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund will usually hold 40 to 80 positions and will be well diversified across the various event strategies. In keeping with the absolute return focus the Manager will eliminate market risk where appropriate by hedging market and foreign currency risks. Since inception the Fund has averaged a net equity market exposure of ~10%. Sizing of an investment position will depend on the expected risk adjusted returns while taking account the liquidity and volatility of the stock. In addition, the maximum potential loss on any one position should be greater than 0.5% of the NAV and the position should not exceed 30% participation of stressed volume assuming a $200m NAV. Other criteria considered are ability to hedge and the availability of pair candidates as well as the average bid-ask size. For M&A strategies average long position is 3 to 5.5% and average short position 2 to 5%. |
| Manager Comments | The Fund's greatest contributions for the month came from Australia and Singapore, with M&A being the most successful strategy. No significant changes were made to the structure of the portfolio during the course of the month. Gross exposures to the 5 key strategies of M&A, Capital Structure, Capital Management, Credit. and Stubs were maintained and, from a regional perspective, Hong Kong, and Japan remained the markets in which the Fund was most heavily invested. The biggest performance detractors came from the Capital Structure and Index Futures strategies. For the month, the Fund's net and gross exposure averaged 13.8% and 223.3% respectively. |
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APN AREIT Fund
18 Jan 2017 - Australian Fund Monitors
APN AREIT Fund increased 6.80% in December to take the latest 24-months return to +30.22%.
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18 Jan 2017 - APN AREIT Fund
By: Australian Fund Monitors
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| Fund Overview | The senior management of APN FM all have significant experience in their fields. They include CEO Real Estate Securities, Michael Doble who has 25 years'experience having held various senior roles specialising in real estate valuation, consultancy and funds management. Immediately prior to joining APN in 2003 he was Head of Property at ANZ Funds Management. He is a fellow of the Australian Property Institute and FINSIA as well as holding a Bachelor of Business (Property). The Fund aims to deliver a competitive yield with lower risk than the market. The underlying stocks are selected based on a highly disciplined investment approach that focuses on the fundamentals and number of valuation approaches. The Fund provides access to a wide spread of property-based revenue streams that are specifically analysed, selected and weighted with the aim of delivering strong and sustainable income returns. The Fund is suited to medium to long term investors seeking a relatively high monthly income and some capital growth over the long term. |
| Manager Comments | For the month of December, the Fund's property sector allocation remained mainly unchanged with 61% in the Retail sector, followed by 20% in the Office sector. Cash increased from the prior month to 3% of the portfolio. The Fund's top 5 holdings were Scentre Group, Vicinity Centres, Stockland, Charter Hall Retail REIT and Dexus Property Group, with 3 of the holdings above 10% each. |
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Fund Review: Bennelong Kardinia Absolute Return Fund December 2016
17 Jan 2017 - Australian Fund Monitors
Latest Fund Review is now available on Bennelong Kardinia Absolute Return Fund, which has over 10 years of positive track record.
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17 Jan 2017 - Fund Review: Bennelong Kardinia Absolute Return Fund December 2016
By: Australian Fund Monitors
AFM Fund Review - December 2016 (pdf format)
BENNELONG KARDINIA ABSOLUTE RETURN FUND
Attached is our most recently updated Fund Review. You are also able to view the Fund's Profile.
- The Fund is long biased, research driven, active equity long/short strategy investing in listed ASX companies with a nine-year track record.
- The Fund has significantly outperformed the ASX200 Accumulation Index since its inception in May 2006 and also has significantly lower risk KPIs. The Fund has an annualised return of 11.22% p.a. with a volatility of 7.21%, compared to the ASX200 Accumulation's return of 5.26% p.a. with a volatility of 14.07%.
- The Fund also has a strong focus on capital protection in negative markets. Portfolio Managers Mark Burgess and Kristiaan Rehder have significant market experience, while Bennelong Funds Management provide infrastructure, operational, compliance and distribution capabilities.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - December 2016 (pdf format)
Affluence Investment Fund
17 Jan 2017 - Australian Fund Monitors
Affluence Investment Fund increased +1.08% in December resulting in a +10.65% return for the calendar year.
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17 Jan 2017 - Affluence Investment Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund does not invest directly into any asset class, rather, it invests in investment managers which satisfy Affluence Funds Management's investment criteria; its investment philosophy is based on a formula developed by CEO/Portfolio Manager Daryl Wilson since the start of his career in 1999. The Fund targets total returns of at least 5% above inflation over rolling 3 year periods with volatility of returns less than 50% of the ASX200 Index. The Fund also aims to provide investors with a distribution yield of at least 5% p.a. Finally, the Fund aims to outperform the Australian stock market (S&P/ASX 200 Accumulation Index) by at least 5% in any year in which that index delivers a negative return. To ensure appropriate diversity of managers and limit the potential for conflicts of interest, no more than 20% of the Fund will be invested with any one manager. Affluence seeks to achieve the Funds' investment objective by choosing attractively priced investments overseen by quality managers. The Fund uses a number of processes to identify potential investments including quantitative screens for investments which meet historical performance, volatility and other criteria. They also use a number of external researchers and information sources to assist in this process. |
| Manager Comments | December was a mixed month for the underlying managers as it was the large caps that continued rising, while a number of small and mid-cap companies having difficulties. The best performing investments were the Bronte Amalthea Fund (up 6.1%), Phoenix Opportunities Fund (up 5.6%), Cromwell Riverpark Trust (up 7.4%) and Auscap Australia Long Short Fund (up 4.0%). A significant detractor was a long/short fund (down 9.7%). At the end of December, the Fund held investments in 24 unlisted funds, representing 57% of the total portfolio. The Affluence LIC Fund accounted for 21% of the total portfolio and provided exposure to 20 LIC's. The Fund held investments in 6 other listed entities which represented 7% of the total portfolio, with the remaining 15% held in cash. |
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Optimal Australia Absolute Trust
16 Jan 2017 - Australian Fund Monitors
The Optimal Australia Absolute Trust returned +0.29% in December 2016, to take the annualised return since inception to 8.54% p.a.
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16 Jan 2017 - Optimal Australia Absolute Trust
By: Australian Fund Monitors
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| Fund Overview | The Fund's bias is likely to be net long under normal market conditions, with the core strategy being to construct a portfolio of listed equity securities priced at levels that do not adequately reflect their underlying value. The Fund will seek to boost returns and limit potential market downside by selective short selling of individual stocks which are priced at levels that are viewed as materially above their underlying value. The Fund will also use certain trading strategies both within its core portfolio (through rebalancing stock weights and overall market exposure in response to price movements) and in certain other situations (typically of a shorter-duration and/or opportunistic nature) with the objective of further increasing returns. |
| Manager Comments | The Fund's stronger long investments included their recent purchase of APN, which the Fund was able to make an investment at a discounted valuation. Woolworths also performed strongly, partly in anticipation of capital liberation through the sale of its non-core interests in petrol retailing. Other solid long performers included financials, namely ANZ, Suncorp, Hendersons, and Clydesdale. The Fund has limited long exposure to resources and materials, but its key long holdings in Orocobre and Newcrest also did well. The investment in Vocus Comms, however, detracted from performance for the month. The Fund continues to look for opportunities in the current bullish market, with a strong focus on capital preservation. |
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Bennelong Kardinia Absolute Return Fund
13 Jan 2017 - Australian Fund Monitors
Bennelong Kardinia Absolute Return Fund rose 1.45% in December to take annualised returns since inception to 11.22% p.a.
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13 Jan 2017 - Bennelong Kardinia Absolute Return Fund
By: Australian Fund Monitors
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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 | ANZ Bank, National Australia Bank, and Commonwealth Bank were the largest positive contributors to performance whilst Shaver Shop, HUB 24 and a short position in Duet were the largest detractors. Net equity market exposure (including derivatives) was reduced by the end of the month to 49.9% (52.5% long and 2.6% short). |
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Paragon Australian Long Short Fund
13 Jan 2017 - Australian Fund Monitors
The Paragon Australian Long Short Fund returned +0.80% in December and +24.73% for the latest 24-months.
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13 Jan 2017 - Paragon Australian Long Short Fund
By: Australian Fund Monitors
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| Fund Overview | Paragon believes that markets are not always efficient, exhibiting a common tendency to price securities well outside of their intrinsic value over the medium term. This market characteristic provides the opportunity for Paragon, an active manager with a flexible mandate, to generate superior investment returns over the longer term. Paragon believes that it is critical to understand both the companies and the industries in which they operate, in order to fully comprehend each investment opportunity. Accordingly, a fundamental approach to company research is taken. Assessing the potential downside is also paramount in framing the risk/reward trade-off for potential investments. |
| Manager Comments | The Fund's positive performance for the year was generated from small and midcaps companies (market capitalisations up to $1.5b). Long and pair positions drove the positive performance, while absolute shorts and SPI shorts (for hedging purposes), detracted from overall returns. Attribution from resources was the biggest sector contributor to the Fund. The market rotation over the last few months has begun to offer attractive opportunities in Australia and the investment team is confident that the Fund is well placed to capitalise current and future opportunities. |
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Cyan C3G Fund
12 Jan 2017 - Australian Fund Monitors
Cyan C3G Fund returned -1.00% in December, to take the annualised return since inception to 27.15% p.a.
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12 Jan 2017 - Cyan C3G Fund
By: Australian Fund Monitors
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| Fund Overview | 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 Fund's negative result in the month was primarily due to its position in Bellamy's (BAL) due to a shock downgrade. In December, the Fund also took small positions in two IPOs: Axesstoday (AXL), which is an equipment finance business and GetSwift (GSW), which provides subscription-based cloud software to small-medium size business to manage their delivery networks. Despite some new stocks, the Fund still contains around 50% in cash and hence is well placed to take advantage of attractive opportunities. |
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Allard Investment Fund
11 Jan 2017 - Australian Fund Monitors
The Allard Investment Fund's (AIF) rose 0.57% for the month of December 2016 (MSCI Asia Pacific ex-Japan A$ +1.28%).
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11 Jan 2017 - Allard Investment Fund
By: Australian Fund Monitors
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| Fund Overview | Allard's investment approach has remained consistent throughout their history: That is to invest prudently but proactively in well-managed businesses that achieve superior returns on capital in industries with long-term growth potential. The Manager uses both broad top-down guidance and detailed bottom-up analysis to identify suitable markets, industries and companies. Although long only investors, a critical factor in their strategy and performance is the ability to hold cash when they cannot find companies that meet their criteria or are at a sufficient discount to their valuations. |
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Totus Alpha Fund
11 Jan 2017 - Australian Fund Monitors
Totus Alpha Fund returned +2.74% in December and +31.65% for the latest 24-months.
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11 Jan 2017 - Totus Alpha Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is a long/short investment fund principally investing in listed entities, commodities, futures and options in Australia and internationally. The Fund is not a market neutral fund and accordingly may switch between net long positions and net short positions. The Fund may use short sales and derivatives. Gearing may be used to enhance returns and the Fund may be geared in excess of 100% of the Fund's Net Asset Value. There is a limit to net exposure of 150%. |
| Manager Comments | Top contributors in December were the long positions in Bapcor +1.33%, SmartGroup + 0.86% and McMillan Shakespeare +0.53%. Biggest detractors were a short position in G8 Education -0.54% and long positions in Hansen -0.39% and Altium -0.30%. At month-end (31 December), the Fund had a net exposure of 57.2% and a gross exposure of 213.4%. The Fund held 105 positions (47 long and 58 short). |
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