MONASH ABSOLUTE INVESTMENT FUND

ATTACHED FILESMonash Absolute Investment Fund Review May 2015 (pdf format)

That's not a bubble, This is a bubble! Or is it?

Hedge Clippings spent an interesting and informative morning this week at Money Management's Asset Allocation event. Apart from moderating a series of discussions covering retirement income amongst financial and wealth advisors, we were treated to a keynote presentation from Stephen van Eyk.

Stephen opened his address by stating that in preparing his presentation he had determined that he would try to put a positive view on his outlook for our collective financial outlook, but that having sifted through all the data and looked at the evidence, this would unfortunately not be possible. No matter which way one looked at it, Australia's low economic growth wasn't responding to interest rates of 2%, and weren't likely to, providing a headache for both the government and the RBA.

The event was wrapped up with a panel discussion entitled "What is the New Bubble", consisting of five leading fund managers, namely Alva Devoy from Fidelity, Tim Samway from Hyperion, Dr Phil Hofflin from Lazard, Anton Tagliaferro from IML, and Matthew Drennan from IOOF. Some interesting ideas, comments and statistics emerged with the usual varying degrees of optimism and pessimism, some of which I managed to recall after the event. Of course given the RBA's comments earlier in the week regarding Sydney house prices, and some typically insensitive, albeit obvious comments from the Treasurer, the discusion leaned towards a real estate bubble.

Anton noted that he did not expect a crash, as they only occurred when not expected, although he also noted the concentration risk within equity markets, and that in his opinion QE had resulted in one of the greatest examples of wealth transfer (from tax payers to financial markets) in history. His expectation was that low growth is set to continue.

Alva Devoy noted that we should get used to current conditions as the "new normal" and it was likely to be 10 years before interest rates returned to the old normal, and that as a result monetary policy would continue to support stretched equity valuations.

Phil Hofflin wondered if we were heading down the Japanese path of long term low growth in spite of central bank stimulation, and turning to the housing market warned of the 65/65 ratio: 65% of bank assets in Australia are in housing, which in turn is on a PE multiple of 65 times, and that the total value of Australia's housing market, if it does correct, is many times larger that the equity market.

Finally Matthew Drennan cautioned that traditional safe havens may not turn out to be so safe. All in all while some of the panel were more cautious than others, along with Stephen van Eyk, none were overly optimistic either.

Specific results received this week include the following PERFORMANCE UPDATES:

Monash Absolute Investment Fund returned -0.40% in May, taking annualised performance since inception in May 2012 to 15.35%.

The Bennelong Long Short Equity Fund performance in May was down 1.91% taking annualised performance since inception in January 2003 to 17.05%.

Allard Investment Fund  returned 1.0% during May, with annualised performance since July 2003 of 9.99%.

FUND REVIEWS released this week: Insync Global Titans Fund; Monash Absolute Investment Fund

UPCOMING EVENTS:

20 - 21 August 2015 - The 2nd Superannuation Fund Investment Operations Forum 2015 is a two day forum providing invaluable technological, regulatory compliant and best practice insights into improving back and middle office efficiency to drive member loyalty, bottom line profitability and a competitive edge

26 - 28 August 2015 - The 15th Annual Wraps, Platforms & Masterfunds Conference will provide solutions for succeeding in a distribution world of endless possibilities, showcasing strategies to help business achieve the biggest bite of market share, use innovation to overcome problems and support opportunities.  Australian Fund Monitors is pleased to offer a discount of $300 to all investors and advisors using coupon code promoFM on registration.

15 September 2015 - The AIMA Australia Hedge Fund Forum 2015 is the annual non-profit hedge fund conference organised by the industry for the industry. 

And finally best wishes for a happy and healthy week-end ahead,

Chris
CEO, AUSTRALIAN FUND MONITORS

Connect with me on LinkedIn Twitter Facebook

Australian Fund Monitors are helping to raise awareness to support research into prevention and cure for cerebral palsy. For more information visit www.cpresearch.org.au or contact me by email.

INSYNC GLOBAL TITANS FUND

ATTACHED FILESInsync Global Titans Fund AFM Fund Review April 2015 (pdf format)

FEEDING FRENZY - SECURING MARKET SHARE IN A COMPETITIVE ENVIRONMENT

26-28 August 2015
Crowne Plaza, Hunter Valley

The evolving regulation and business of financial services, as well as the rapid growth of Fintech, have made the politics of distribution for financial products more competitive than in recent years. With the market swimming with new entrants, there has never been a better time to collaborate and to compete to achieve distribution success in a crowded ocean. 

The 15th Annual Wraps, Platforms & Masterfunds Conference will provide solutions for succeeding in a distribution world of endless possibilities, showcasing strategies to help your business achieve the biggest bite of market share, use innovation to overcome problems and support opportunities.

Australian Fund Monitors is pleased to offer a discount of $300
to all investors and advisors using coupon code promoFM on registration.

With insights from Steve Baxter, entrepreneur, investor and 'Shark' from Network Ten's television series Shark Tank, this conference will provide a unique perspective on the feeding frenzy of new entrepreneurs keeping platforms alive. 

Key topics and conference themes include:

• The Murray Inquiry and future of financial services
• The changing market dynamics of the financial advice industry
• Licensee negotiation and approved product list strategies
• What financial advisers want from technological service providers
• Developments in the fintech - opportunities and threats
• Overview of the dealer group market and
• What dealer heads want
• Marketing and product distribution strategies
• Adapting to changes in the dealer group market
• Strategies for attaining market share in competitive technology markets

Who should Attend?

The conference is a must-attend event for any financial services business or provider seeking to better understand the current market and opportunities for growth. Over 14 years the conference has delivered market intelligence, insights and opinions to:

• Platform providers
• Dealer group heads and other senior executives
• Investment researchers
• Fund managers
• Distribution heads and senior distribution managers
• Senior product and marketing managers
• Financial advisers
• Mortgage industry executives
• Other intermediary businesses seeking to diversify in the financial planning/advice sector 

Contact

Registration enquiries
Craig Lynch
Phone: 02 8045 2020
Email: [email protected]

General enquiries
Jennifer Hardy
Phone: 02 8045 2067
Email:[email protected]

Sponsorship enquiries
John Briggs
Phone: 02 8045 2010
Mobile: 0418 694 292
Email: [email protected]

ATTACHED FILES2015 wraps platforms conference agenda (pdf format)

Volatile global bond markets unsettle markets

While equity markets usually grab the business headlines, it is the global bond market which really carries the punch. The past month has seen some extreme, and worrying moves on bond markets, with German 10 year bonds moving from 0.05% to 0.90% in an unprecendented period of volatility, in part driven by dwindling liquidity.

Other markets have followed suit, with the US 10 year rate moving from 1.80 to 2.30%, and Australia's from 2.30 to 3.05%. 

The background for the situation has been created in part by central bank intervention which has pushed interest rates to unsustainably low levels on the back of QE, and in part by regulators forcing, or at least discouraging, banks from participating as market makers though legislation such as the Volker Rule contained in the Dodd Franks Act.

Expect to hear and feel much more of the outcome of these moves over the weeks to come, with bond markets reportedly 3 times the size of equities. As George Colman from Optimal notes in his monthly note "Beware the bonds: Central banks may just have lost control". Regular readers of Hedge Clippings will note we are prone to quoting George, who has been on the bearish side for some time, but having returned 2% for each of the past two months it is more than possible that his views are worth listening to.  

Australia's situation is somewhat different, although no less worrying, in spite of Treasurer Hockey's describing those concerned about the economy as "clowns" for being negative. No sooner had he done so than flat retail sales figures for April were released, possibly indicating who was really wearing the clown's outfit.  

Specific results received this week include the following LATEST PERFORMANCE UPDATES:

Supervised High Yield Fund rose 0.52% during April to bring the Fund's annual return since inception to 10.18% aganst the RBA Cash Rate return of 3.47%.

QATO Capital Market Neutral Long/Short Fund  although down -2.96% in April has still returned 16.93% over the last 6 months.

The Insync Global Titans Fund fell -0.40% in April, with 12 month performance 19.27%.

Signature Quantitative Fund returned -2.10% for April, to bring the annual performance since inception to 13.11%.

The Cor Capital Fund was down 0.65% in April to bring annual performance since inception to 5.55% p.a., compared to the RBA cash rate of 2.68% p.a.

Chris

CEO

AUSTRALIAN FUND MONITORS

Connect with me on LinkedIn and Twitter

Australian Fund Monitors are helping to raise awareness to support research into prevention and cure for cerebral palsy. For more information visit www.cpresearch.org.au or contact me by email.