News
Bennelong Alpha 200 Fund
16 Jan 2015 - Australian Fund Monitors
Bennelong Alpha 200 Fund returned -0.13% during December, bringing returns to 2.26% over 2014 (ASX Accum Index 5.61%).
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16 Jan 2015 - Bennelong Alpha 200 Fund
By: Australian Fund Monitors
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| Fund Overview | The core investment strategy of the Fund consists of the active selection of a series of paired long/short investments in Australian listed equities based upon the Investment Manager's fundamental research. The strategy seeks to capture stock Alpha whilst limiting portfolio exposure to market risk by adopting a dollar neutral portfolio market exposure position with the tactical capability to take net exposure of up to +/- 20% of gross assets. Stock selection is based on fundamental analysis to derive a view of a pair of individual stocks. The Investment Manager is style neutral in determining the stock's positioning. This primary 'pairs' strategy may be enhanced by other complementary strategies, including event driven, security and takeover arbitrage, thematic and momentum trading. The paired stock positions comprise long and short correlated securities that are in most cases simultaneously opened. A portfolio of approximately 30-100 stocks will be selected and actively managed in 15-50 pairs to comprise the core minimum (60%) of the Gross Asset Value. Up to a maximum of 40% of the portfolio's Gross Asset Value may be invested in uncorrelated securities and/or uncovered (long and/or short) positions. These 'satellite' positions are intended to enhance returns and to balance overall portfolio risk. In this regard, the Investment Manager recognises that it is not always possible to achieve a suitable paired proļ¬le within the S&P/ASX 200, and that a high conviction long or short stock idea might not always have a suitable pair. |
| Manager Comments | The fund delivered a flat result in a volatile December. At a sector level Energy, Consumer Staples and Industrials performed quite strongly with weakness in Consumer Discretionary, Healthcare and Materials. The month featured several trading updates which aided the Consumer Staples pair but was harmful to one of the portfolio's Retail exposures. Kathmandu provided an earning downgrade due to weak conditions in its Australian business resulting in slowing like-for-like sales growth and margin reduction. The falling oil price aided our overall Energy exposure. |
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Morphic Global Opportunities Fund
15 Jan 2015 - Australian Fund Monitors
Morphic Global Opportunities Fund returned 2.62% in December bringing the annual return to 13.99% (Global Equity Index 12.57%) with a volatility of 7.75%.
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15 Jan 2015 - Morphic Global Opportunities Fund
By: Australian Fund Monitors
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| Manager Comments | December saw a continuation of positive returns for the Fund. Continued falls in oil and other commodity prices were a major theme for the month, rewarding the Fund's overweight positioning in commodity consuming emerging markets China and India, and its underweight stance in commodity producing bourses like Russia, Indonesia, and Brazil. The Fund's underweight position in Australia and the Australian dollar also helped. The Fund closed the month fully invested, with the main features being overweight positions in China and India against the rest of the emerging market complex. There were no currency and minimal interest rate hedges at month end. |
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Bennelong Kardinia Absolute Return Fund
15 Jan 2015 - Australian Fund Monitors
Bennelong Kardinia Absolute Return Fund returned 1.53% during December, bringing 2014 performance to 5.77% (ASX 200 Acc 5.61%) with volatility at 4.17% (Index 10.95%).
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15 Jan 2015 - 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 | Long positions in SurfStitch, Amcor and BXB were the major positive contributors to performance, whilst a short positon in Share Price Index Futures (hedging long positions) and long positions in Australian Careers Network and Asaleo Care were the largest detractors. Equity market exposure was actively managed throughout the month with a month-end net (including derivatives) of 69.9% (83.7% long and 13.9% short). |
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Insync Global Titans Fund
19 Dec 2014 - Australian Fund Monitors
In a difficult month for equities the Insync Global Titans Fund returned 5.67%, bringing 12 month returns 12.88% with volatility 8.87%.
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19 Dec 2014 - Insync Global Titans Fund
By: Australian Fund Monitors
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| Manager Comments | The performance was driven by positive contributions from our holdings in Medtronic, Oracle, Sanofi, BAT and Sky as well as the weaker Australian dollar. The Fund continues to hedge its investments with the portfolio protection strategies currently employed and to also have no foreign currency hedging in place as we believe the risks to the Australian dollar are likely to be on the downside. Insync's philosophy is to invest in the more predictable growth companies and to include dynamic downside protection strategies. During previous periods of significant market falls and heightened volatility the fund has delivered positive absolute returns from, employing its downside protection strategies. The fund looks for exceptional businesses with high ROIC, strong free cash flow, solid balance sheets and a long track record of returning cash to shareholders through growing dividends and/or share buy-backs. |
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Alpha Beta Asian Fund
19 Dec 2014 - Australian Fund Monitors
Alpha Beta Asian Fund returned 2.10% during November with annual performance of 6.18% with a volatility of 4.31%.
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19 Dec 2014 - Alpha Beta Asian Fund
By: Australian Fund Monitors
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| Fund Overview | The investment objective of the Fund is to produce positive annual returns without excessive risk. This is achieved through the use of a quantitative approach to invest both long and short in large cap companies listed on Asian stock exchanges. The Fund may also use index futures to manage risk. Stock prices and company fundamental data are decomposed into directional and mean reverting components. Each of Alpha Beta's models are based on either of these known behaviours with capital management built into each model. The benefit of a quantitative approach is that it is both repeatable and unemotional, and allows a different source of returns to be extracted from a very noisy market environment. |
| Manager Comments | The has recorded 63% positive months since inception and a maximum draw-down of 2.90%. Fund beta is 0.09 mapped to the MSCI AC Asia Pacific Index (MXAP) with a correlation of 0.17 to the same Index. The Fund generated a return of +2.10% during November, with the strongest performance coming from our Quantamental models, in particular in Hong Kong (a contribution of +1.5%) and two of our new markets, Taiwan (+0.7%) and Malaysia (+0.3%). It seems that our recent addition of these markets has already borne fruit. |
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Aurora Fortitude Absolute Return Fund
18 Dec 2014 - Australian Fund Monitors
Aurora Fortitude Absolute Return Fund returned 0.38% during November and 2.22% for the previous 12 months with a volatility of 1.07%.
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18 Dec 2014 - Aurora Fortitude Absolute Return Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund aims to produce positive returns irrespective of the direction of the share market. For each investment the manager considers the risk, the timeline of that risk occurring and then the potential return. Low transaction costs and liquidity are other important factors in the success and implementation of the strategies. |
| Manager Comments | In November the fund's Option Strategy contributed significantly at 1.22%. Whilst the commodity names grabbed the headlines, positive contributions were also made concomitantly across the industrial sector, with the adjustment in the retail sector being the major factor. Following a disappointing sales update Woolworths Limited (WOW.ASX) fell 13.56%. Their major competitor Wesfarmers Limited (WES.ASX) fell a more modest 6.12%. The Fund was able to generate positive returns in both names. Other significant contributors were Woodside Petroleum (WPL.ASX), BHP Billiton (BHP.ASX) and Westpac Banking Corporation (WBC.ASX). The Long/Short trading was the most significant drawdown during the month (-0.77%). There was too much exposure to small capitalisation resources companies, which were generally entered int with the view to exiting post an 'event or catalyst' in a relatively short time period. However, the extent of market sell off and the lack of liquidity in these names has caused us to implement exit strategies for the bulk of these position and reassessing our approach in this space. |
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Totus Alpha Fund
17 Dec 2014 - Australian Fund Monitors
Totus Alpha Fund returned 6.14% during November and 15.05% over the prior 12 months with a volatility 8.61%.
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17 Dec 2014 - 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 | The Sharpe and Sortino ratios over the last year are 1.39 (0.21) and 2.83 (0.23) respectively with the Up and Down Capture ratios 0.59 and -0.27. As at 30 November, the fund had a net exposure of 39.40% and a gross exposure of 265.0%/ The fund held 112 positions (43 long and 69 short). The fund is active on both the long and short side but it is in periods of heightened market volatility (like November) that the ability to short sell really adds value. |
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Optimal Australia Absolute Trust
16 Dec 2014 - Australian Fund Monitors
Optimal Australia Absolute Trust returned -0.53% against the ASC 200 Accum Index -3.25% in November with annual returns at 5.41%, with a volatility of 2.08%.
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16 Dec 2014 - 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 recorded 83% positive months over the last year and a maximum draw-down of -0.71% as compared to the Index at -5.38%. The accelerating slide in energy prices was the big story of the month in the markets, and this dynamic also had a big influence on the Fund's return. Energy and materials stocks dominated our long return attribution of -1.91% on average long exposure of 48%. Similarly, energy and financials were the major source of gains in our short portfolio, with attribution of +1.37% on average short exposure of 31%. |
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Bennelong Long Short Equity Fund November 2014
15 Dec 2014 - Australian Fund Monitors
The Bennelong Long Short Equity Fund returned 3.12% in November outperforming the ASX 200 Accum Index -3.25%. The fund has returned -6.76% over the previous 12 months with a volatility of 9.96%.
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15 Dec 2014 - Bennelong Long Short Equity Fund November 2014
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. |
| Manager Comments | Long term performance remains sound with since inception (Jan 2003) returns at 17.12% pa (Index 7.99%) and a volatility of 11.94% (Index 12.91%). Sharpe and Sortino ratios are well ahead of the Index at 1.01 and 1.68 respectively. In November the fund performance stabilised with key pairs making solid contributions. Stock positions in Quantas and Challenger slightly offset these returns. At the industry level, Consumer Staples short, Health Care long and Consumer Discretionary short were outperformers whilst our Industrials long positions underperformed. We were relatively active during the month, taking advantage of price movements to adjust weightings in several pairs and we also introduced one new pair. |
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The Paragon Fund
12 Dec 2014 - Australian Fund Monitors
The Paragon Fund returned -3.10% (ASX 200 Accum -3.25%) during November with annual returns at 16.72% (Index 4.30%) with a volatility 15.11% (Index 10.84%).
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12 Dec 2014 - The Paragon Fund
By: Australian Fund Monitors
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| Fund Overview | Paragon accepts that markets are not always efficient in pricing information into securities and that no one investment style works in every stage of the investment cycle. Subsequently Paragon adopts a top down thematic led approach to identify companies exhibiting sustainable or improving returns on capital driven by volume growth, pricing power and competitive advantages. Paragon utilises both quantitative analysis to provide probability weighted high/low/base case valuations and qualitative analysis in assessing management, the business model and likely direction of returns. Paragon will allocate assets to each investment opportunity based on a risk/reward profile. Positions have defined investment parameters and risk limits, which are then monitored on an ongoing basis. |
| Manager Comments | Key drivers of the Paragon Fund performance for November included solid returns from long positions in Qantas and Henderson Group and short positions in Woodside and Computershare, offset by falls in G8 Education, TFS Corp, Donaco and our resource holdings generally. At the end of November the fund had 29 long positions and 10 short positions. |
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