News
Optimal Australia Absolute Trust
9 Dec 2016 - Australian Fund Monitors
The Optimal Australia Absolute Trust rose 0.95% in November 2016, to take the annualised return since inception to 8.59% p.a.
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9 Dec 2016 - 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 positive performance came from the Fund's holdings in financials (ANZ, Clydesdale, Suncorp, Hendersons), resources (Orocobre) and materials. During the month, the Fund initiated a new long position in APN, which has rationalised itself down to two attractive media exposures in radio and outdoor advertising and at a discounted valuation arising from technical pressure around its recent capital raising. Hedging the market risk through short selling was successful in the interest-rate sensitive stocks. The Fund had slightly positive net market exposure (+2.4% of NAV) at month-end and retains some scepticism about the sustainability of the 'Trump bump'. Click below to read the latest Fund monthly report. |
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Bennelong Long Short Equity Fund
8 Dec 2016 - Australian Fund Monitors
Bennelong Long Short Equity Fund returned -2.24% in November and up 26.68% for the latest 24-months.
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8 Dec 2016 - Bennelong Long Short Equity Fund
By: Australian Fund Monitors
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| Fund Overview | 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. |
| Manager Comments | The Fund's under-performed was due to an even mix of winning and losing pairs with no particular position having a disproportionate impact on return. The top 3 spreads for the month came from the following pairs; Long Quantas/Short Flight Centre, Long Adelaide Brighton/Short Boral and Long IIuka/Short Downer. The month's market rotation out of the higher quality and defensive names toward lesser quality names on lower multiples or with cyclical potential hasn't caused the Fund to change its portfolio position. Instead, the investment team accepts that their preferences to be long in business with better growth prospects can sometimes lead the long book to trade at a price-premium to the short book. Hence, exposing the Fund to under-performance if either the premium becomes stretched or sentiment changes. However, the Fund has no plans to adjust its current positions unless justified by changes in the fundamentals. Click below to read the Fund Manager's commentary and market outlook. |
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Fund Review: Insync Global Titans Fund October 2016
2 Dec 2016 - Australian Fund Monitors
Latest Fund Review on Insync Global Titans Fund is now available.
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2 Dec 2016 - Fund Review: Insync Global Titans Fund October 2016
By: Australian Fund Monitors
AFM Fund Review - October 2016 (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's unit price decreased by -3.80% in October. The performance was driven by positive contributions from our holdings in Time Warner, Microsoft, PayPal, Visa and Moody's. The main negative contributors were Unilever, Comcast, eBay, BAT and Zimmer.
- 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.
AFM Fund Review - October 2016 (pdf format)
Fund Review: Bennelong Twenty20 Australian Equities Fund October 2016
30 Nov 2016 - Australian Fund Monitors
Latest Fund Review on Bennelong Twenty20 Australian Equities Fund is now available.
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30 Nov 2016 - Fund Review: Bennelong Twenty20 Australian Equities Fund October 2016
By: Australian Fund Monitors
AFM Fund Review - October 2016 (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 2016 (pdf format)
Insync Global Titans Fund
29 Nov 2016 - Australian Fund Monitors
The Insync Global Titans Fund returned -3.80% in October, compared to the MSCI All Country World ex-Australia Net Total Return Index in $A, which returned -1.10%.
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29 Nov 2016 - Insync Global Titans 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 performance was driven by positive contributions from the holdings in Time Warner, Microsoft, PayPal, Visa and Moody's. The main negative contributors were Unilever, Comcast, eBay, BAT and Zimmer. The Fund continues to have no foreign currency hedging in place as Insync consider the main risks to the Australian dollar to be on the downside. Over 50% of the Fund is currently protected using their put protection strategy. Click below to read the latest Fund Manager Report. |
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Fund Review Pengana Absolute Return Asia Pacific Fund October 2016
28 Nov 2016 - Australian Fund Monitors
Latest Fund Review is now available on Pengana Absolute Return Asia Pacific Fund, which has over 7 years of positive track record and an annualised return of 8.92% p.a.
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28 Nov 2016 - Fund Review Pengana Absolute Return Asia Pacific Fund October 2016
By: Australian Fund Monitors
AFM Fund Review - October 2016 (pdf format)
PENGANA ABSOLUTE RETURN ASIA PACIFIC FUND
Attached is our most recently updated Fund Review on the Pengana Absolute Return Asia Pacific Fund.
- The Pengana Absolute Return Asia Pacific Fund ("PARAP") was established in 2008 by portfolio managers Antonio Meroni and Vikas Kumra. The Fund is a feeder fund into a Cayman Islands AUD share class fund.
- The Fund invests both long and short in Asia Pacific equities, including in Australian and New Zealand, after a stock specific "event" has either occurred or been announced and the portfolio aims to be uncorrelated to the underlying equity markets. A combination of the Manager's experience, thorough research and continuous back- testing identify the most attractive of these events.
- Risk controls include limits on individual positions as well as gross and net exposure. Limits are in place for option exposure and cash borrowing, with stop loss limits on individual positions. Overall the manager is looking to derive returns from the event strategies as opposed to any currency or market exposures.
- Since inception, the Fund has an annualised return of 8.92% p.a., compared to the MSCI ACWI Asia Pacific Price Index's return of 3.83% p.a.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - October 2016 (pdf format)
Pengana PanAgora Absolute Return Global Equities Fund
25 Nov 2016 - Australian Fund Monitors
Pengana PanAgora Absolute Return Global Equities Fund rose 1.40% in October. The Fund has a low systematic risk (beta) to the ASX 200 and the MSCI World Indices of 0.08 and 0.09 respectively.
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25 Nov 2016 - Pengana PanAgora Absolute Return Global Equities Fund
By: Australian Fund Monitors
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| Fund Overview | PanAgora believes the best way to find opportunities in the global markets is to combine fundamental analysis with robust quantitative techniques in order to filter the investment universe and select the investments. The Fund invests primarily in listed equity securities from a global universe of developed markets and a select group of emerging market countries. The Fund's objective is to seek absolute returns by identifying and exploiting multiple inefficiencies that may exist in global equity markets. These inefficiencies are primarily exploited through the use of a long/short equity strategy which aims to construct a portfolio that is generally neutral to market movements. As such the performance of the investment strategy is largely independent of the market's performance. The Fund seeks to achieve its objective by using a diversified set of strategies that have low correlation to one another. In addition, because many of these strategies are designed to generate profit under different market conditions, their combination is expected to result in more stable returns over time than any individual strategy in and of itself. |
| Manager Comments | The October return was largely driven by the strong performance of the Fund's international long-term alpha model, which contributed +0.96%. A deeper look at this model revealed that investors favoured higher quality and previously neglected stocks that were trading at compelling valuations. The long-term model in the US also contributed positively (+0.5%) to the Fund's return. However, the intermediate and short-term arbitrage strategies underperformed, detracting -0.06% from the overall return. Click below to read the latest Fund Manager's Report. |
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QATO Capital Market Neutral Long/Short Fund
24 Nov 2016 - Australian Fund Monitors
Qato Capital Market Neutral Long/Short Fund returned -1.43% for the month of October, outperforming the ASX-100's fall of -1.90%, by +0.47%.
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24 Nov 2016 - QATO Capital Market Neutral Long/Short Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund seeks to preserve capital and maximise absolute returns through active and constant risk management, targeting monthly a net market exposure of 0% to hedge broader market risks with up to 50 S&P/ASX-100 positions (up to 25 long positions & 25 short positions). Historically, the strategy has been uncorrelated to traditional asset classes with a negative beta to equity markets. Qato Capital's process is entirely systematic - stock selection and risk management are all employed in a rules based approach. Positions in Qato's long-portfolio and short-portfolio are rotated monthly dependent upon their Q-Score ranking. The strategy employs no financial leverage/gearing to purchase securities, no derivatives and no financial products to imitate leverage. |
| Manager Comments | Materials were the strongest performing sector of October, posting a +1.20% gain for the period. Qato's long position in Fortescue (+11.10%), reported strong results in October. South 32, also held in Qato's long-book reported in line with its previous guidance, closing the month up +6.60%. Assuming commodity prices remain at current spot levels, Qato believes further EPS upgrades in FY17 and FY18 as Materials continue to experience strong fundamental improvements. The Fund currently holds several positions in this sector. Another positive contributor was AMP, which came from Qato's short-book, added generous alpha of +14.90% for the Fund. However, the negative performance in REITs of -7.40%, adversely affected Qato's long-book, as the Fund held a number of positions in this sector. |
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Fund Review: APN Asian REIT Fund October 2016
23 Nov 2016 - Australian Fund Monitors
October Fund Review is now available on APN Asian REIT Fund, a property securities fund, investing primarily in the Asian REITS.
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23 Nov 2016 - Fund Review: APN Asian REIT Fund October 2016
By: Australian Fund Monitors
AFM Fund Review - October 2016 (pdf format)
APN Asian REIT Fund
Attached is our most recently updated Fund Review on the APN Asian REIT Fund.
We would like to highlight the following aspects of the Fund;
- APN is an ASX-listed fund manager specialising in property investment, with an investment team of six. Established in 1996, APN now has FUM of $A2.4bn including four REIT (Real Estate Investment Trust) funds.
- The APN Asian REIT Fund (Fund) is a property securities fund that invests in a quality portfolio of Asian REITs, listed on the securities exchanges of the Asian Region, with the ability to hold some cash and fixed interest investments.
- 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 universe can include new IPO's, other corporate actions take place and / or corporate governance improvements at country or REIT level bring new stocks into focus.
- 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 an unhedged product.
- APN's Asian REIT Fund invests in a portfolio of 25-40 listed Asian REITs with a core philosophy of investing in properties with sustainable rental income streams.
- The Fund has delivered an annualised return of 15.65% p.a., since inception in July 2011 with a standard deviation of 9.46% p.a. The Sharpe and Sortino ratios are 1.30 and 2.38 respectively.
AFM Fund Review - October 2016 (pdf format)
Bennelong Twenty20 Australian Equities Fund
23 Nov 2016 - Australian Fund Monitors
Bennelong Twenty20 Australian Equities Fund returned -2.20% in October to take latest 6-months return to 4.25%.
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23 Nov 2016 - 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 | From the active position in the ex-20 stocks, Star Entertainment Group and Ramsay Health Care were the biggest two detractors. However, this portfolio benefited from a position in Fortescue Metals Group, which was one of the best performing stocks on the ASX over the month. With lofty expectations baked into share prices, it will be important to be invested in companies that can achieve what is expected of them. The investment team believes that for the Fund, this involves attempting to gain conviction in earnings delivery at the individual stock level. Click below to read the latest Fund Report. |
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