Fund Review: Optimal Australia Absolute Trust July 2014

21 Aug 2014 - Australian Fund Monitors

CPD Points are now available for all AFM Fund Reviews. Read the review and answer 5 questions to earn half a point toward your continuing professional development.

Morphic Global Opportunities Fund

20 Aug 2014 - Australian Fund Monitors

Morphic Global Opportunities Fund returned -0.73% during July and 11.34% over the prior 12 months with a standard deviation of 8.64%.

Totus Alpha Fund

19 Aug 2014 - Australian Fund Monitors

Totus Alpha Fund returned 3.55% during July with an annual return of 37.86% and a volatility of 15.62%.

19 Aug 2014 - Totus Alpha Fund

By: Australian Fund Monitors

Report Date	18 August 2014
Manager	Totus Capital
Fund Name	Totus Alpha Fund
Strategy	Equity Long/Short
Latest Return Date	July 2014
Latest Return	3.55%
Latest 6 Months	5.15%
Latest 12 Months	37.86%
Latest 24 Months	65.39%
Annualised Since Inception	26.83%
Inception Date	01 April 2012
FUM (millions)	AU$12
Fund Overview	The Totus Alpha Fund aims to maximise returns for investors through fundamental industry and company research and active portfolio management. The investment strategy is based on identifying medium to long term structural investment themes and seek absolute returns by investing in securities that have concentrated exposure to those themes. 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	Totus Alpha Fund returned 3.55% (4.40% ASX 200 Accum) during July with an annual return of 37.86% (Index 16.54%) and a volatility of 15.62% (Index 8.23%). The Up and Down Capture ratios were 1.44 and -0.5 respectively and the Sharpe ratio 2.00 over the previous twelve months. The Fund's performance has been impacted by the re-emergence of private equity and corporate interest in a number of under-performing businesses (of the type we generally look to short) as well as a general rotation out of many quality businesses that had performed well for us into "laggards" such as gold mining shares and domestics cyclicals which we have tended to avoid (or short). Top contributors to performance in July were long our positions in Healthscope +2.53% (ageing population), Intueri Education +0.79% (scarce growth) and Flight Centre +0.76% (scarce growth).
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Fund Review: Bennelong Kardinia Absolute Return Fund July 2014

19 Aug 2014 - Australian Fund Monitors

CPD Points are now available for all AFM Fund Reviews. Read the review and answer 5 questions to earn half a point toward your continuing professional development.

Forager Australian Shares Fund

18 Aug 2014 - Australian Fund Monitors

Forager Australian Shares Fund recorded an out-performance of the Index 2.30% (Fund 6.70%) during July and returned 13.73% for the previous 12 months.

18 Aug 2014 - Forager Australian Shares Fund

By: Australian Fund Monitors

Report Date	15 August 2014
Manager	Forager Funds Management
Fund Name	Forager Australian Shares Fund
Strategy	Equity Long
Latest Return Date	July 2014
Latest Return	6.70%
Latest 6 Months	3.35%
Latest 12 Months	13.73%
Latest 24 Months	58.18%
Annualised Since Inception	13.98%
Inception Date	17 October 2009
FUM (millions)	AU$56
Fund Overview	Forager Funds Management places no emphasis on predicting short-term price movements or the direction of markets. The focus is on valuing securities and attempting to buy them for substantially less than their underlying value. The Forager approach is to be patient, selective and only invest in opportunities where the gap between its estimate of value and the current security price is significant enough to compensate for the large degree of uncertainty inherent in valuing any security.
Manager Comments	Forager Australian Shares Fund recorded an out-performance of the Index 2.20% (Fund 6.70%) during July and returned 13.73% for the previous 12 months. Since inception (October 2009) the Fund has out-performed the ASX 200 Accum index with a return of 13.98% (Index 8.77%) with Sharpe and Sortino ratios of 0.78 and 1.34 above that of the Index. While positive contributors included portfolio mainstays GBST, Hansen and RNY Property Trust, the most significant contribution came from a new addition to the portfolio �" civil and mining company Brierty. Those gains were partly offset by declines in Infigen Energy and Hughes Drilling. There is now approximately 17% of the fund invested in a collection of businesses either directly or partially exposed to mining services. The sector remains under intense pressure, and a couple of these investments have been a significant drag on performance over the past 12 months. The Fund's monthly report is available on the AFM website under the Fund's profile.
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Fund Review: Microequities Deep Value Microcap Fund July 2014

18 Aug 2014 - Australian Fund Monitors

CPD Points are now available for all AFM Fund Reviews. Read the review and answer 5 questions to earn half a point toward your continuing professional development.

Optimal Australia Absolute Trust

15 Aug 2014 - Australian Fund Monitors

Optimal Australia Absolute Trust returned 1.03% during July and 6.37% for the previous twelve months with a standard deviation of 1.69%.

15 Aug 2014 - Optimal Australia Absolute Trust

By: Australian Fund Monitors

Report Date	14 August 2014
Manager	Optimal Fund Management Australia
Fund Name	Optimal Australia Absolute Trust
Strategy	Equity Long/Short
Latest Return Date	July 2014
Latest Return	1.03%
Latest 6 Months	4.82%
Latest 12 Months	6.37%
Latest 24 Months	9.31%
Annualised Since Inception	10.30%
Inception Date	15 September 2008
FUM (millions)	AU$120
Fund Overview	The investment objective of the Fund is to seek to achieve above average returns in absolute terms, through investing in listed securities in Australia and New Zealand, subject to the overarching requirement of capital preservation. Investments will predominantly be in equity securities but may include fixed interest instruments, money market instruments, derivatives and foreign exchange contracts. 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	Optimal Australia Absolute Trust returned 1.03% during July and 6.37% for the previous twelve months with a standard deviation of 1.69%. The Sharpe and Sortino ratios were 2.22 and 4.98 respectively as compared to 1.61 and 3.27 for the ASX 200 Accumulation Index respectively. The low volatility nature of the Fund is indicated by the Up and Down Capture ratios of 0.24 and -0.12 respectively. The Fund has also achieved 85% positive months since inception in September 2008. The Trust's performance in July featured very strong returns from stock selection, although the Fund's net short exposure to a sharply rising market held back overall returns. At a stock level, the Fund's long positions performed strongly, with positive attribution of +3.4%, on long market exposure averaging 54% of NAV, or around double the overall market's gain on an equivalent exposure basis. This more than offset the cost of insuring our portfolio against downside risk.
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The Paragon Fund

14 Aug 2014 - Australian Fund Monitors

The Paragon Fund recorded a return of 12.50% during July (Index 4.40%) with an annual return of 43.65% (Index 16.54%).

14 Aug 2014 - The Paragon Fund

By: Australian Fund Monitors

Report Date	13 August 2014
Manager	Paragon Funds Management
Fund Name	The Paragon Fund
Strategy	Equity Long/Short
Latest Return Date	July 2014
Latest Return	12.50%
Latest 6 Months	25.84%
Latest 12 Months	43.65%
Latest 24 Months
Annualised Since Inception	31.71%
Inception Date	28 February 2013
FUM (millions)	AU$15
Fund Overview	Australian long-short equities absolute return fund, focusing on core competencies in the resource and industrial sectors. The Fund deploys a high conviction, long bias strategy, focusing on proprietary, fact based research. Capital preservation is a key objective of the Fund. 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	The Paragon Fund recorded a return of 12.50% during July (ASx 200 Accum Index 4.40%) with an annual return of 43.65% (Index 16.54%). Volatility was 13.36% as compared to the Index at 8.23%. The Sortino ratio was 7.97 (Index 3.27) with the Up and Down Capture ratios 1.47 and -1.16. Key drivers of the Paragon Fund performance for July included strong returns from our resource investments in Liquefied Natural Gas, Triton Minerals, Orocobre Ltd and OZ Minerals. Industrial firms Crown Resorts and G8 Education also had strong months. At the end of June the fund had 25 long positions and 4 short positions.
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Bennelong Kardinia Absolute Return Fund

14 Aug 2014 - Australian Fund Monitors

Bennelong Kardinia Absolute Return Fund returned 1.07% during July bringing annual performance to 7.02% with a volatility of 4.29%.

14 Aug 2014 - Bennelong Kardinia Absolute Return Fund

By: Australian Fund Monitors

Report Date	12 August 2014
Manager	Kardinia Capital, a Bennelong Funds Management boutique
Fund Name	Bennelong Kardinia Absolute Return Fund
Strategy	Equity Long/Short
Latest Return Date	July 2014
Latest Return	1.07%
Latest 6 Months	3.72%
Latest 12 Months	7.02%
Latest 24 Months	23.30%
Annualised Since Inception	13.24%
Inception Date	01 May 2006
FUM (millions)	AU$180
Fund Overview	The Fund consists of a concentrated long/short portfolio typically comprising 20 to 50 ASX300 listed stocks, generally with a long bias aligned to the overall market direction. On average since inception the Fund's exposure has averaged 40% net long. There is a slight bias to large cap stocks on the long side of the portfolio, although in a rising market the portfolio will tend to hold smaller caps, including resource stocks, more frequently. On the short side, the portfolio is particularly concentrated, with stock selection limited by both liquidity and the difficulty of borrowing stock in smaller cap companies. Short positions are only taken when there is a high conviction view on the specific stock. The Fund uses derivatives in a limited way, mainly selling short dated covered call options to generate additional income. These typically have less than 30 days to expiry, and are usually 5% to 10% out of the money. ASX SPI futures and index put options can be used to hedge the portfolio's overall net position. 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	Bennelong Kardinia Absolute Return Fund returned 1.07% during July bringing annual performance to 7.02% with a volatility of 4.29%. Since inception (May 2006) performance is sound with a return of 13.24% (ASX 200 Accum 5.33%) and a volatility of 7.61% (Index 14.32%). The Sharpe ratio over that time is 1.1 (Index 0.13). The net equity market exposure of the Fund (including derivatives) was increased to 60.1% (82.4% long and 22.3% short). Long positions in Crown, Challenger and BHP were the major positive contributors. Short positions in Webjet and Price Index Futures contracts (hedging longs), as well as a long position in Ansell,were the largest detractors.
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Fund Review: Monash Absolute Investment Fund July 2014

14 Aug 2014 - Australian Fund Monitors

CPD Points are now available for all AFM Fund Reviews. Read the review and answer 5 questions to earn half a point toward your continuing professional development.

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21 Aug 2014 - Fund Review: Optimal Australia Absolute Trust July 2014

OPTIMAL AUSTRALIA ABSOLUTE TRUST

AFM have released the most recently updated Fund Review on the Optimal Australia Absolute Trust.

20 Aug 2014 - Morphic Global Opportunities Fund

19 Aug 2014 - Totus Alpha Fund

19 Aug 2014 - Fund Review: Bennelong Kardinia Absolute Return Fund July 2014

18 Aug 2014 - Forager Australian Shares Fund

18 Aug 2014 - Fund Review: Microequities Deep Value Microcap Fund July 2014

MICROEQUITIES DEEP VALUE FUND

15 Aug 2014 - Optimal Australia Absolute Trust

14 Aug 2014 - The Paragon Fund

14 Aug 2014 - Bennelong Kardinia Absolute Return Fund

14 Aug 2014 - Fund Review: Monash Absolute Investment Fund July 2014

MONASH ABSOLUTE INVESTMENT FUND

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