News
K2 Asian Fund
27 Mar 2013 - Australian Fund Monitors
The K2 Asian Fund delivers 2.11% during February and 18.33% over the preceding 12 months.
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27 Mar 2013 - K2 Asian Fund
By: Australian Fund Monitors
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| Manager Comments | The K2 Asia Absolute Return Fund returned 2.11% for the month of February. The MSCI Asia Pacific ex. Japan (AUD) returned 2.82% (+1.49% in local currency). February delivered another solid return led by The Philippines (+7.8%), Indonesia(+7.7%) and Australia (+5.2%). Eroding the quality of the region’s move was the performance of the Hong-listed China H-Shares which, at their low fell 8.5%, before partially recovering to end down 5.7%. After a near 35% run over the previous 5 months, sellers focused on China’s re-acceleration and the fear of policy tightening measures owing to high credit growth and a strong property market. Over February the Fund’s net exposure ranged between 95-100%. Despite solid equity market returns over the past six months, expectations of continued fund inflows into global equity markets and the region in particular, coupled with still modest valuations and progressive upgrades to earnings forecasts all continue to underpin the Fund's rationale for a high exposure. Net inflows into emerging market equity funds have been some of the strongest in almost a decade and have been well spread across a number of markets. The Fund will continue to run high exposure while positive momentum prevails in economic growth and earnings and while valuations sit at healthy discounts to long term averages, all elements which are compelling underweight investors to progressively redirect capital into Asia, notably China. With regards to China the Fund is holding a high weighting so long as the upward momentum in earnings forecasts is supported by favorable economic momentum. Concern over possible policy tightening has some credence given the high levels of new credit finding its way into the economy and given the propensity of excessive new credit to find its way into speculative activities. This is the key domestic issue to monitor. The hedge against the Fund’s USD-linked exposure remains in place. While the hedge neutralizes currency movements in those markets in which it is employed, in February the overall strength in the currencies the fund invests in resulted in a net positive contribution from currency. |
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Platypus Australian Equity Fund February 2013
26 Mar 2013 - Australian Fund Monitors
The Platypus Australian Equity Fund records a return of 3.1% over February and 18.74% over the previous 12 months.
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26 Mar 2013 - Platypus Australian Equity Fund February 2013
By: Australian Fund Monitors
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| Manager Comments | In terms of negative impacts on the portfolio the manager notes that Western Areas was a drag on relative performance as the nickel price remained depressed. While not owning National Australia Bank, was a notable drag on the month’s alpha, nil positions in other large cap names like Newcrest Mining, Telstra and Rio Tinto contributed to February’s performance. Amongst the stocks owned, CSL was the biggest contributor to performance followed by Codan, a new addition to the portfolio. While the fund's under-performance was driven mainly by stocks not in the portfolio, Industrials and Financials sectors were the other notable drags on performance.On the positive side, Consumer Discretionary, Information Technology and a nil weighting in Telecommunication Services added to relative performance during February. New positions in the month included Amcor, Acrux, Woodside, Realestate.com, Codan and JB Hi-Fi. Caltex was sold, monetizing a profitable trade, Aurizon (nee QR National) was also sold after they delivered earnings below expectations as was TWE after their 2013 guidance was underwhelming relative to our expectations. The balance of the month’s trading activity involved topping up in stocks such as Blackthorn Resources, Fortescue Metals Group and Sirtex Medical, funded from selling down positions in BHP, Oil Search, Westpac, Ramsay Healthcare, Resmed, News Corp and Flight Centre. In terms of valuation, the market is neither cheap nor expensive. If the manager's moderately bullish stance on the earnings upgrade cycle is correct, we would expect the market to remain at around present valuations. While cognizant of the fact that after strong price returns, the likelihood of a short term pullback increases, for longer term investors the manager's view is that on balance, Australian equities represent value at these levels and as a domestic investor, you are still being paid to hold equities. |
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Denning Pryce Equity Income Fund
25 Mar 2013 - Australian Fund Monitors
The Zurich Denning Pryce Equity Income Fund records performance of 3.61% for February 2013 and 19.84% for the previous 12 months.
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25 Mar 2013 - Denning Pryce Equity Income Fund
By: Australian Fund Monitors
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| Manager Comments | Australian equities rose strongly during February as markets continued their momentum for most of the month. Locally the economy continues to grind lower, although the Australian equity market was one of the best performing markets globally as investors digested a fairly positive reporting season which seemed to beat or meet consensus expectations. The Fund is particularly defensively placed at present with early half the portfolio option-covered and contract prices are ‘in-the-money’. Additionally, the major bank shares portfolio has been restructured to provide cover against a market pull-back and to maintain our exposure to dividends and franking credits in May and June. Woolworths and Wesfarmers have seen exposures fall as these stocks rallied strongly. The Fund has written call options in Santos and Woodside Petroleum, to generate attractive premium. Meanwhile, the Fund has positions in BHP and Rio Tinto to reduce portfolio risks in the event of commodity weakness. Pricing of Index call options bounced and allowed for some profit taking. In the put options, there is not too much interest in significant portfolio protection as sentiment is confident, buoyed by low interest rates and market momentum. Over the last 12 months has provided an (estimated) yield of 11.34% including franking credits, with a volatility of just under 80% of that of the S&P/ASX 50 volatility. |
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Prime Value Growth Fund
22 Mar 2013 - Australian Fund Monitors
The Prime Value Fund records a return of 5.3% during February and 14.53% during the preceding 12 months.
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22 Mar 2013 - Prime Value Growth Fund
By: Australian Fund Monitors
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| Manager Comments | The Australian equity market continued its strong start, with the benchmark S&P/ASX 300 Accumulation index rising a further 5.3% during February. Global equity markets also rose, but stumbled mid-month due to an inconclusive result in Italian elections (and increasing support of anti-austerity parties) as well as fears the US “easy” monetary policy would be scaled back. US budget issues (avoiding automatic spending cuts which would reduce growth) also weighed on investor sentiment. Economic data in the US and China was neutral to positive. Domestically, the focus was on the reporting season. In general, the results season was viewed as positive as the number of positive surprises outnumbered negative. However price action was subdued. Cost reduction and margin expansion were some of the key themes of the season. The Fund also performed well during February, rising by 5.4% and outperforming the benchmark. Stock selection was positive, again across most sectors. The biggest positive contributors to performance were REA Group (up 29.8%), National Australia Bank (up 10.4%) and Westpac (up 9.7%). The companies which detracted from performance were Monadelphous (down 6.6%), BHP Billiton (down 1.1%) and Newcrest (down 3.2%). The fund's preferred sectors are Consumer Staples, Energy and selected quality mining services companies with an underweight in non-bank Financials. 88.6% of stock held were in the top 100 and the largest holdings were ANZ, BHP Monadelphous, Wesfarmers and Westpac. |
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K2 Australian Absolute Return Fund
21 Mar 2013 - Australian Fund Monitors
The K2 Australian Fund delivers a returns of 4.47% during February 2013 and 20.28% over the previous year.
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21 Mar 2013 - K2 Australian Absolute Return Fund
By: Australian Fund Monitors
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| Fund Overview | - The Fund is managed 'opportunistically'. Investments are made throughout Australia and New Zealand across sectors that the investment team believes will add greatest value. - Typically the Fund will hold between 50 and 70 listed equities. - If deemed appropriate, the Fund may be 100% invested in cash. - To implement the Fund's Long/Short investment strategy, K2 is able to use leverage or gear the Fund. However, the net invested position of the Fund shall not exceed the Net Asset Value (NAV) of the Fund. |
| Manager Comments | The manager notes that the All Ordinaries Accumulation Index pushed higher for the 9th consecutive month, gaining +5.18%. Domestically, the RBA left cash rates unchanged at 3.00% and noted that the current outlook for inflation “would afford scope to ease policy further, should that be necessary to support demand.” While the RBA acknowledged domestic activity will fall well short of their expectations, positive global developments in recent months has caused a ‘wait and see approach’ from the Board. Consequently expectations for further rate cuts have been pushed out. For six consecutive months the manager has maintained net exposure over 90%. Now that the All Ordinaries Accumulation Index is within 5% of its all-time high the question is “…is it time to prune back exposure?”. Given that the current strength in the Australian equity market has been delivered without any meaningful earning momentum there is a need to assess whether profits are at a cyclical low and about to commence an upward trend. The manager's view is that the economy will now surprise on the upside and hence we have seen the low point in the profit cycle. In addition, revenue growth will outstrip cost growth and DPS growth will outstrip EPS growth. It is this growing dividend income stream that will lure retail investors out of term deposits. Overlaying this is the fact that the average term deposit for less than 6 months is now below 3.30% whereas the average yield of the top 20 listed stocks is over 4%, and therefore it is likely that equities will re-emerge in most retail investment portfolio’s this year. The portfolio had it's largest contributions from Bank of Queensland Ltd, ANZ Banking, Flight Centre and National Australia Bank with the smallest contributions from Aurizon Holdings, BHP Billiton, Miclyn Express Offshore and Panaust. Largest holdings were National Australia Bank at 8.6%, BHP Billiton 8.4%, RIO Tinto 6.3%, Flight Centre 6.1% and ANZ Banking 5.7%. The fund was 97% invested at month-end. |
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Insync Global Titans Fund
20 Mar 2013 - Australian Fund Monitors
The Insync Global Titans Fund returns 1.7% during February 2013 and 21.1% for the year ended February.
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20 Mar 2013 - Insync Global Titans Fund
By: Australian Fund Monitors
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| Manager Comments | The manager comments that equity markets were buoyant in February driven by liquidity generated by global central banks. Also assisting sentiment were signs of an improving US economy and comments by US Fed chairman Bernanke that the benefits of QE outweighed the costs. In Europe an inconclusive Italian election with a strong anti-austerity protest vote was a reminder that the European debt issue is still far from resolved. The fund's performance was broadly based with the largest contributions from Wyndham, Roche and Reckitt Benckiser. Negative contributions came from Coach, SAP and Oracle. With buoyant equity markets and very low levels of volatility Insync took the opportunity to increase the level of the fund's protection to reduce the impact of any correction. Key fund holdings were Nestle S.A, McDonald's, Accenture, Richemont and SAP AG. Average market capitalisation of stocks in the portfolio was $A92.9bn with a weighted forecast dividend yield of 2.68% and PE ratio of 15.1 times. The fund was not hedged back into $A. |
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Morphic Global Opportunities Fund
19 Mar 2013 - Australian Fund Monitors
The Morphic Global Opportunities Fund records a return of 0.9% during February 2013 and 10.76% over the last 6 months.
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19 Mar 2013 - Morphic Global Opportunities Fund
By: Australian Fund Monitors
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| Manager Comments | The manager notes that market tone was dominated by a resurgence in uncertainty in Europe, and for the Euro, caused by the Italian election deadlock and fears the US economic recovery might falter in the face of mandated cuts to government spending. Both issues may continue to be a factor in March, especially the Italian stalemate. Weak economies throughout Europe mean support for the anti-establishment parties, focused on ending austerity and leaving Euro is on the rise, with potentially unpredictable economic and market consequences. In terms of the fund the manager recorded losses on four Indian bank positions which offset large gains made in other markets, especially Thailand and Japan. Under-performance also came from the tilt to emerging markets over developed markets and a European bank over-weight. Gains were made on a range of Japanese holdings as well as on Manilla Water and two Hong Kong holdings. Gains were also made on some short positions in Europe and Asia. The fund reduced its net investment level over the period as it seemed strong inflows has left stocks, particularly in Europe and emerging markets over-extended. The fund remains un-hedged into $A but does have some of the fund's yen exposure hedged into $US. The fund also has a short US bonds and long German bonds position in the fixed interest portion of the portfolio. |
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Platinum International Fund
18 Mar 2013 - Australian Fund Monitors
The Platinum International Fund returns 1.18% for February 2013 and 15.38% for the prior 12 months.
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18 Mar 2013 - Platinum International Fund
By: Australian Fund Monitors
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| Manager Comments | The manager notes that the MSCI (AUD) rose 1.9% over the month and the market was caught between easy central bank policy and macro issues facing the global economy. In the UK the tug-of-war between ongoing low rates and a credit downgrade saw the equity market up 1% however the pound dropped 4.5%. The Italian market fell 9% after the election left the political situation very fluid. In the US budget issues remained however the US market still out-performed emerging markets and the $US was stronger. Japanese equity continued to record strong returns up 4.0% assisted by the Yen which fell 1% and a new Bank of Japan Governor. The fund's over-weight to Japan at 21.7%, assisted fund performance. At month-end the Fund was 99% long and 12% short with cash and liquids at 1% for a net invested position of 88%. |
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Aurora Fortitude Absolute Return Fund Performance February 2013
15 Mar 2013 - Australian Fund Monitors
The Aurora Fortitude Absolute Return Fund returns
0.80% for February 2013 and 4.00% for the preceding 12 months.
0.80% for February 2013 and 4.00% for the preceding 12 months.
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15 Mar 2013 - Aurora Fortitude Absolute Return Fund Performance February 2013
By: Australian Fund Monitors
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| Manager Comments | Examining each of the Fund's strategies the Options portfolio was the best performing strategy for the month (+0.58%). As anticipated, the historically low levels of volatility provided an opportunity to profit from an increase in volatility over reporting season. This was most pronounced in the Fund’s March Index Futures position. Also of benefit was the small net long, and long volatility overlay in all four of the the major banks. Boral was an under-performer because the stock rallied sharply while the Fund held a short bias. Under-performing for the month was the Long/Short strategy (-0.16%) despite holding mostly long positions. Atlas Iron came under pressure as a result of the declining iron ore price, a poor result and general materials weakness. A stop loss was implemented over this position. The Yield book was consistent (+0.18%), with ANZ Convertible Preference Shares performing particularly well after going ex-distribution. The Fund continued to add to short dated instruments with mid-year maturities. The Convergence as well as Mergers and Acquisition strategies were both small net contributors to returns. |
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BlackRock Australian Equity Market Neutral Fund Performance - February 2013
14 Mar 2013 - Australian Fund Monitors
The BlackRock Australian Equity Market Neutral Fund delivers 1.35% during February 2013 and 6.88% over the preceding 12 months.
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14 Mar 2013 - BlackRock Australian Equity Market Neutral Fund Performance - February 2013
By: Australian Fund Monitors
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| Fund Overview | The Fund's portfolio primarily consists of long and short Australian equity positions. The Fund may also invest in other funds managed by BlackRock. Derivative securities, such as futures, forwards, swaps and options, can be used to manage risk and return Key insights into the investment process include: Analyst Expectations, Relative Valuation, Earnings Quality, Market Signals and Timing. Short-Term return enhancing opportunities including: Dividend reinvestment plans, Manging index changes, Managing cash flows, Arbitrage, Initial public offerings and Seasoned Equity Offerings and Off Market Buybacks. |
| Manager Comments | The manager comments that the Australian equity market continued its rally into February with the S&P/ASX 200 Price Index up 4.6% to mark its third consecutive month of gains. This was despite some volatility caused by concerns about US Federal Reserve policy and the Italian election result. Investors were buoyed by an earnings season that tended to see companies meet or beat expectations, with cost reductions and margin improvement recurring themes, and payout ratios generally lifted. The bullish tone was not reflected in a typical risk on rally, with ASX200 Resources up 0.6% while ASX200 REITs were up 3.5% and Industrials up 6.9%. The search for yield in the equity market appeared to focus mainly on the big four banks, which outperformed strongly. Domestic Cyclicals performed well through the results season, particularly financials and retailers, as better than expected results squeezed short positions. Despite the continued market valuation expansion, the result season saw a greater differentiation in returns at the individual stock level than was witnessed in January. This favored the fund's investment process and led to a rebound in active performance. The fund recorded contributions from JB Hi-Fi, Bluescope Steel, Cochlear, IAG and NAB. Detractors from performance include Seek, Toll, Alumina, QBE and Treasury Group. |
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