News
Performance Report: Insync Global Capital Aware Fund
29 Nov 2019 - Australian Fund Monitors
The Insync Global Capital Aware Fund has risen +22.05% after fees and protection over the past 12 months against AFM's Global Equity Index's +15.59%. Since inception in October 2009, the Fund has returned +10.99% p.a. with an annualised...
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29 Nov 2019 - Performance Report: Insync Global Capital Aware Fund
By: Australian Fund Monitors
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| Fund Overview | Insync employs four simple screens to narrow the universe of over 40,000 listed companies globally to a focus group of high quality companies that it believes have the potential to consistently grow their profits and dividends. These screens are size of the company, balance sheet performance, valuation and dividend quality. Companies that pass this due diligence process are then valued using dividend discount models, free cash flow yield and proprietary implied growth and expected return models. The end result is a high conviction portfolio of typically 15-30 stocks. The principal investments will be in shares of companies listed on international stock exchanges (including the US, Europe and Asia). The Fund may also hold cash, derivatives (for example futures, options and swaps), currency contracts, American Depository Receipts and Global Depository Receipts. The Fund may also invest in various types of international pooled investment vehicles. At times, Insync may consider holding higher levels of cash if valuations are full and it is difficult to find attractive investment opportunities. When Insync believes markets to be overvalued, it may hold part of its resources in cash, or use derivatives as a way of reducing its equity exposure. Insync may use options, futures and other derivatives to reduce risk or gain exposure to underlying physical investments. The Fund may purchase put options on market indices or specific stocks to hedge against losses caused by declines in the prices of stocks in its portfolio. |
| Manager Comments | The Fund returned -0.89% after fees and downside protection in October. Positive contributors included Apple, Bristol-Myer Squibb, Facebook, Rightmove PLC and Nvidia Corp. Detractors were Heineken, Estee Lauder, Constellation Brands, Accenture and Intuit. The Fund continues to have no currency hedging as Insync consider to main risks to the Australian dollar to be on the downside. Insync noted there continued to be a shift from quality growth companies to wards cyclical companies during the month, led by optimism around some form of partial trade deal. Whilst central banks globally now have an accommodative monetary policy, Insync continue to hold the view that the global economic backdrop remains challenging, with low growth and low inflation a major headwind for businesses that are reliant on a strong economy to drive their earnings. They believe the current environment continues to favour secular growth businesses with high levels of profitability. |
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Performance Report: Surrey Australian Equities Fund
29 Nov 2019 - Australian Fund Monitors
The Surrey Australian Equities Fund returned -1.69% after fees in October, taking performance CYTD to +19.42%. The portfolio ended the period with 37 individual stock holdings and a cash balance of 6%.
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29 Nov 2019 - Performance Report: Surrey Australian Equities Fund
By: Australian Fund Monitors
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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 Surrey Australian Equities Fund returned -1.69% after fees in October, taking performance CYTD to +19.42%. The portfolio ended the period with 37 individual stock holdings and a cash balance of 6%. The Fund's top holdings included Cooper Energy Ltd (COE), IMF Group (IMF), Jumbo Interactive (JIN), Smart Group (SIQ) and Xero Limited (XRO). The majority of the Fund's holdings have a market capitalisation of less than $1bn, with the Industrials and IT sectors carrying the greatest weighting. Surrey Asset Management noted that, overall, they remain pleased with the operational performance of the companies within their portfolio. Some exceptions include Costa Group (CGC) and IMF Bentham (IMF). The Manager has reduced the Fund's exposure to Costa Group and noted they don't believe the current IMF share price represents its true long-term value. While IMF and CGC negatively impacted the Fund's performance, Surrey Asset Management remain comfortable with both positions at current levels. They discuss both in detail in their latest monthly report while also highlighting the franking credits they received by retaining the Fund's holding in GBST (GBT) into its final takeover. |
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Performance Report: Paragon Australian Long Short Fund
29 Nov 2019 - Australian Fund Monitors
The Paragon Australian Long Short Fund has returned +10.08% p.a. since inception in March 2013, outperforming the ASX200 Accumulation Index by +1.37% on an annualised basis.
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29 Nov 2019 - Performance Report: Paragon Australian Long Short Fund
By: Australian Fund Monitors
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| Fund Overview | 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 has returned +10.08% p.a. since inception in March 2013, outperforming the ASX200 Accumulation Index by +1.37% on an annualised basis. The Fund's capacity to significantly outperform in falling markets is highlighted by its down-capture ratio for performance since inception of 42.2%. The Fund returned -1.6% after fees in October, in line with all Australian indices. Paragon noted October was a challenging month as they saw a continuing rotation of value to growth stocks. Positive contributors included Alacer Gold, Xero and PointsBet. These were offset by declines in Jumbo, Prospa and the Fund's other gold holdings. Adriatic and PointsBet both conducted successful capital raisings to fund growth initiatives. Xero delivered another solid interim result and Alacer released another excellent quarterly result, both continuing to break multi-year highs, and remain key long positions for the Fund. Paragon discuss their views on Xero and Alacer in more depth in their latest report. |
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Fund Review: Bennelong Twenty20 Australian Equities Fund October 2019
29 Nov 2019 - Australian Fund Monitors
The latest Fund Review on Bennelong Twenty20 Australian Equities Fund is now available. The Fund invests in ASX listed stocks, combining an indexed position in the Top 20 stocks with an actively managed portfolio of ex-20 stocks.
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29 Nov 2019 - Fund Review: Bennelong Twenty20 Australian Equities Fund October 2019
By: Australian Fund Monitors
AFM Fund Review - October 2019 (pdf format)
BENNELONG TWENTY20 AUSTRALIAN EQUITIES FUND
Attached is our most recently updated Fund Review on the Bennelong Twenty20 Australian Equities Fund.
- The Bennelong Twenty20 Australian Equities Fund invests in ASX listed stocks, combining an indexed position in the Top 20 stocks with an actively managed portfolio of stocks outside the Top 20. Construction of the ex-top 20 portfolio is fundamental, bottom-up, core investment style, biased to quality stocks, with a structured risk management approach.
- Mark East, the Fund's Chief Investment Officer, and Keith Kwang, Director of Quantitative Research have over 50 years combined market experience. Bennelong Funds Management (BFM) provides the investment manager, Bennelong Australian Equity Partners (BAEP) with infrastructure, operational, compliance and distribution services.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - October 2019 (pdf format)
Performance Report: 4D Global Infrastructure Fund
28 Nov 2019 - Australian Fund Monitors
Bennelong's 4D Infrastructure Fund posted a positive return of 0.06% in October, taking YTD performance to 26.57% without a negative monthly return. Over 12 months the fund has returned 27.03%, almost 20% above the fund's benchmark return...
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28 Nov 2019 - Performance Report: 4D Global Infrastructure Fund
By: Australian Fund Monitors
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| Fund Overview | The fund will be managed as a single portfolio of listed global infrastructure securities including regulated utilities in gas, electricity and water, transport infrastructure such as airports, ports, road and rail as well as communication assets such as the towers and satellite sectors. The portfolio is intended to have exposure to both developed and emerging market opportunities, with country risk assessed internally before any investment is considered. The maximum absolute position of an individual stock is 7% of the fund. |
| Manager Comments | Despite a slowing global environment, 4D remain confident in their overweight exposure to user pays assets, although ongoing geopolitical issues are of concern to certain regions such as the UK and Hong Kong. 4D maintain a very positive outlook for global listed infrastructure over the medium term, given the number of powerful macro forces at play which will continue to support the sector, including a huge underinvestment in infrastructure around the world over the past 30 years. In addition, the world's population is expected to grow by 53% by the end of this century, which will be accompanied by an emerging middle class, especially in Asia, which combined will compel new, improved and expanded infrastructure around the world. At the end of October, the Fund held 26% exposure to North America, 35% to Developed Europe, and 32% to Emerging Markets, and 7% in cash. |
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Performance Report: DS Capital Growth Fund
28 Nov 2019 - Australian Fund Monitors
DS Capital reported a return of 1.57% for the month of October, taking 12 month performance to 19.9%. Since inception in January 2013 the fund has returned investors 15.34% with volatility just 7.13% for a Sharpe ratio of 1.79%.
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28 Nov 2019 - Performance Report: DS Capital Growth Fund
By: Australian Fund Monitors
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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 | The Manager's quarterly report to the end of September noted that the fund started the financial year well, enjoying a strong quarter with the main influence on stock markets during the quarter continuing to be interest rates, ongoing trade negotiations between the US and China, and the slowdown in global economic growth. The quarter featured many full year earnings results. In general, profit improvement was modest, outlook guidance disappointed more than usual, and growth expectations became more measured. The uncertain geopolitical environment saw investors focus closely on outlook commentary and any negativity saw share prices punished. Fortunately, most of the Fund's holdings delivered good results that were in line with our expectations with the main exception being cinema software provider, Vista Group. The Funds discretionary consumer businesses performed well with both Zip Money and Collins Foods reporting strong results. |
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Performance Report: Australian Eagle Trust Long-Short Fund
27 Nov 2019 - Australian Fund Monitors
The Australian Eagle Trust Long-Short Fund has risen +29.49% over the past 12 months against the ASX200 Accumulation Index's +19.29%. Since inception in July 2016, the Fund has returned +19.83% p.a. versus the Index's +12.19%.
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27 Nov 2019 - Performance Report: Australian Eagle Trust Long-Short Fund
By: Australian Fund Monitors
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| Manager Comments | The Fund's Sharpe and Sortino ratios, 1.53 and 2.89 respectively, by contrast with the Index's Sharpe of 1.18 and Sortino of 2.01, highlight the Fund's capacity to achieve superior risk-adjusted returns whilst avoiding the market's downside volatility over the long-term. The Fund's up-capture and down-capture ratios, 133.1% and 71.0% respectively, indicate that, on average, the Fund has significantly outperformed in both rising and falling markets since inception. Over the September quarter, the Fund returned +1.26%. The long side of the portfolio contributed positively while the short side of the portfolio detracted from performance. Positive individual contributors included CYBG (short), Treasury Wine Estates (long) and ResMed (long). Key detractors included James Hardie (short), Domino's Pizza Enterprise (short) and Flight Centre (short). |
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Performance Report: Bennelong Twenty20 Australian Equities Fund
27 Nov 2019 - Australian Fund Monitors
The Bennelong Twenty20 Australian Equities Fund returned +0.29% in October, outperforming the ASX200 Accumulation Index by +0.64% and taking annualised performance since inception in November 2009 to +10.60% versus the Index's +8.33%.
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27 Nov 2019 - Performance Report: Bennelong Twenty20 Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is managed as one portfolio but comprises and combines two separately managed exposures: 1. An investment in the top 20 stocks of the markets, which the Fund achieves by taking an indexed position in the S&P/ASX 20 Index; and 2. An investment in the stocks beyond the S&P/ASX 20 Index. This exposure is managed on an active basis using a fundamental core approach. The Fund may also invest in securities expected to be listed on the ASX, securities listed or expected to be listed on other exchanges where such securities relate to ASX-listed securities.Derivative instruments may be used to replicate underlying positions and hedge market and company specific risks. The companies within the portfolio are primarily selected from, but not limited to, the S&P/ASX 300 Accumulation Index. The Fund typically holds between 40-55 stocks and thus is considered to be highly concentrated. This means that investors should expect to see high short-term volatility. The Fund seeks to achieve growth over the long-term, therefore the minimum suggested investment timeframe is 5 years. |
| Manager Comments | As at the end of October, the Fund's weightings were increased in the Discretionary, Health Care and Industrials sectors, and decreased in the Consumer Staples, Communication, REIT's, IT, Energy, Financials and Materials sectors. The Fund's top holdings included Commonwealth Bank, CSL, BHP Billiton, Westpac Banking, National Australia Bank, Goodman, ANZ and Aristocrat Leisure. |
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Fund Review: Insync Global Capital Aware Fund October 2019
26 Nov 2019 - Australian Fund Monitors
Latest Fund Review on Insync Global Capital Aware Fund is now available. The Global Capital Aware Fund invests in a concentrated portfolio of 15-30 stocks, targeting exceptional, large cap global companies with a strong focus on dividend...
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26 Nov 2019 - Fund Review: Insync Global Capital Aware Fund October 2019
By: Australian Fund Monitors
AFM Fund Review - October 2019 (pdf format)
INSYNC GLOBAL CAPITAL AWARE FUND
Attached is our most recently updated Fund Review on the Insync Global Capital Aware Fund.
We would like to highlight the following:
- The Global Capital Aware 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.
AFM Fund Review - October 2019 (pdf format)
Performance Report: Gyrostat Absolute Return Income Equity Fund
25 Nov 2019 - Australian Fund Monitors
The Gyrostat Absolute Return Income Equity Fund returned +0.12% in October, taking 12-month performance to +8.40%. Since inception in December 2010, the Fund has returned +4.48% p.a. with an annualised volatility of 3.76%.
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25 Nov 2019 - Performance Report: Gyrostat Absolute Return Income Equity Fund
By: Australian Fund Monitors
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| Fund Overview | The investment objective is to deliver regular and stable income stream (from ASX20 dividends) in a low interest rate environment with capital security - an 'alternative - defensive' asset class. Gyrostat has for 34 consecutive quarters operated within a 'hard' defined risk parameter (no more than 3% capital at risk with our maximum draw-down 2.2% in any circumstances) always in place, delivered regular income at a minimum BBSW90 + 3% by passing through ASX-20 dividends, and met returns guidance based upon market conditions (demonstrating increasing returns with market volatility). The fund buys and holds ASX-20 shares with lowest cost protection always in place with upside. It is an 'alternative - defensive' conservative asset allocation. Advances in investment risk management enable cost-effective protection to always be in place for a 'hard' defined risk parameter (say no more than 3% capital at risk). Returns are designed to increase as volatility levels increase, as this provides more opportunities to lower protection costs. Investment Objectives: - Returns: 6% - 8% pa in trending markets, greater than 8% pa in volatile markets, BBSW90 + 3% in stable markets - Income: Minimum cash rate + 3% paid semi-annually (currently 4.2% p.a.) from dividends and franking credits - Protection: No quarterly NAV draw-downs exceeding 3% Also includes a 'tail hedge' for gains on large market falls |
| Manager Comments | The Fund is a solution for falling interest rates. It has a 'conservative' asset allocation and has for 35 consecutive quarters since inception operated within a 'hard' defined risk parameter (no quarterly NAV drawdowns exceeding 3%), delivered regular equity income (by passing through ASX20 dividends), and returns increasing with volatility levels (including a tail hedge for large gains on large market falls). Gyrostat noted they anticipate increasing levels of 'late cycle' market volatility with geopolitical tensions elevated, historically high debt levels and elevated valuations. |
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