Meme Australian Share Fund

Attached is our most recently updated Fund Review on the Meme Australian Share Fund.

We would like to highlight the following aspects of the Fund;

• The Meme Capital Management is a Perth-based boutique Fund Manager, established in 2012 and manages the Meme Australian Share Fund.

• The Fund specializes in technical and quantitative strategies to identify investment opportunities expected to provide both positive price appreciation and relative price out-performance over the medium to long term.

• The Fund's objective is to outperform the S&P/ASX All Ordinaries Accumulation Index over rolling three year periods, through investing in ASX listed securities outside the S&P/ASX 20. The Fund only takes long positions and does not use derivatives.

• Over the past 12 months, the Fund returned positive 28.38%, versus the Index's 1.90% return. 

Australian Fund Monitors

ATTACHED FILESMeme Australian Share Fund AFM Fund Review November 2015 (pdf format)

SUPERVISED HIGH YIELD FUND

Attached is AFM's updated Fund Review on the Supervised High Yield Fund.

We would like to highlight the following aspects of the Fund:

• The Supervised High Yield Fund (SHYF) has a 6 year track record investing in fixed interest investments. The Investment strategy aims to deliver returns with zero correlation to equity markets by investing in debt securities with minimal default probability and offering a premium return above the risk free rate.
• The Fund is managed by Philip Carden whose experience in debt and capital markets spans over 32years, including time with JB Were's Capel Court Securities and Macquarie Bank, where he was the Executive Director responsible for the Debt Markets Division.
• SHYF is an Alternative Income fund which invests in Global and Australian debt markets, with all foreign currency receivables hedged back to Australian dollars.
• The Fund utilises a top down analysis of the economic environment and market to screen and identify debt market opportunities which it believes offer low risk with high yield. The next stage is the development of a risk matrix and investment strategy, following which detailed research is undertaken on specific investment opportunities which meet the pre-defined criteria established in the investment strategy.
• Prior to approving an investment for the Fund each potential investment is subject to two stress tests. The first of these is for credit and default risk, in which the investment is stress-tested to ensure that in a worst case economic environment it can repay 100% of its principal and interest obligations case scenario for the asset by examining the highest margin over the risk rate that the investment has previously experienced in a crisis situation. Any decline in value under the stress test that exceeds 10% of the Fund's value is avoided The second test examines market risk.  In this case Carden looks at the worst case scenario for the asset by examining the highest margin over the risk rate that the investment has previously experienced in a crisis situation.  Any decline in value under the stress test that exceeds 10% of the Fund's value is avoided.

Australian Fund Monitors

ATTACHED FILESSupervised High Yield Fund AFM Review October 2015 (pdf format)

INSYNC GLOBAL TITANS FUND

Attached is our most recently updated Fund Review on the Insync Global Titans Fund.

We would like to highlight the following:

• The Fund returned 3.5% for the month of October. The performance was driven by positive contributions from our holdings in Microsoft, Medtronic, McDonald's and Zimmer. The Fund continues to have no foreign currency hedging in place as Insync consider that the risk to the Australian dollar continues to be on the downside.

• The Global Titans Fund invests in a concentrated portfolio of 15-30 stocks, targeting exceptional, large cap global companies with a strong focus on dividend growth and downside protection.

• Portfolio selection is driven by a core strategy of investing in companies with sustainable growth in dividends, high returns on capital, positive free cash flows and strong balance sheets.

• Emphasis on limiting downside risk is through extensive company research, the ability to hold cash and long protective index put options.

For further details on the Fund, please do not hesitate to contact us.

Australian Fund Monitors

ATTACHED FILESInsync Global Titans Fund AFM Monthly Report - October 2015 (pdf format)

AURORA FORTITUDE ABSOLUTE RETURN FUND

Attached is our most recently updated Fund Review on the Aurora Fortitude Absolute Return Fund.

We would like to highlight the following aspects of the Fund;

• The Aurora Fortitude Absolute Return Fund  (AFARF) has a 10 year track record investing in ASX listed equities. A Market Neutral overlay is used across a multi strategy approach which allows for flexible asset allocation to maximise returns and minimise risk under a variety of market conditions and cycles.CIO John Corr has over 20 years financial market experience with a strong focus on risk.

• Significant use of low risk "long" derivatives and option overlays has provided positive returns with low volatility during periods of market dislocation. Risk statistics are impressive and shows the Funds risk philosophy; 85% of monthly performances have been positive with no losing months in 2008, the Fund's largest drawdown is -2.09% and the Sharpe ratio 1.09.

• ASX listed Aurora Funds Limited was established on the merger of three existing fund management businesses, managing approx. $230m on behalf of more than 2,500 retail and wholesale investors.

Australian Fund Monitors

ATTACHED FILESAurora Fortitude Absolute Return Fund AFM Review October 2015 (pdf format)

Are we turning Japanese?

The experts are telling us that we are facing the first US rate rise in nearly seven years. However it is worth remembering we've been here before, with expectations for a Fed tightening having been on the cards for at least the past 18 months. Each time they've pulled back from the brink, either because the market reaction was so savage, or a more recent statistic or world event cut them off at the pass.

So we would have to ask the question, will it be any different this time around? And if it is, what's in store beyond the first upward move, considering that interest rate movements rarely, if ever, occur in isolation?

The reality is that the world's economy is in a very different place, and what might have occurred in the past is not occurring now. Maybe we're fixated by the recent past, rather than the distant, or the reality of the present, but the feeling is that as and when US rates do start to climb, they will struggle to get far beyond 1% in the foreseeable future.

Now one percent might not seem much, but given there's been so much debate and consternation about the first 0.25% (or maybe it will only be 0.125%) rise, one percent represents at least four rate rises. Could it be that the Japanese experience of the past 20 years is going to be reflected across the Pacific? 

Japan has effectively had a debt overhang, having never cleared their debts of the '80's. Allied with a demographic problem, Japan has struggled to record any meaningful growth since the early 1990's. The US may be different, but is the world's economy facing the same future as Japan, and are we all turning Japanese as a result.

Performance updates and reviews received this week included the following PERFORMANCE UPDATES:

APN AREIT Fund rose 4.43% in October to bring annualised return since inception to 17.90% p.a.

Insync Global Titans Fund rose 3.5% in October, to take their 12 month return to 22.02%

In October, KIS Asia Long Short Fund rose 2.50%, to bring the Fund's annualised return since inception 15.16%.

Freehold Absolute Return Fund delivered a positive 1.29% for the month of October, to take their 24 month return to 26.97%.

The Supervised High Yield Fund produced a return of +0.54% for the month of October, to bring annualised performance since inception to 9.87% p.a.

FUND REVIEWS released this week:Pengana Absolute Return Asia Pacific Fund; Totus Alpha Fund; APN Asian REIT Fund;

And on that note, I trust you have a safe and enjoyable week-end.

Regards,

Chris
CEO, AUSTRALIAN FUND MONITORS

Connect with me on LinkedIn Twitter Facebook