NEWS
Fund Review: ARCO Absolute Trust March 2018
13 Apr 2018 - Australian Fund Monitors
Read the latest Fund Review on ARCO Absolute Trust. ARCO Investment Management is a specialist Australian equity investment manager and the Fund has a long/short equity strategy typically with a low but variable net market exposure...
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13 Apr 2018 - Fund Review: ARCO Absolute Trust March 2018
By: Australian Fund Monitors
AFM Fund Review - March 2018 (pdf format)
ARCO ABSOLUTE TRUST (formerly Optimal Australia Absolute Trust)
AFM have released the most recently updated Fund Review on the ARCO Absolute Trust.
We would like to highlight the following aspects of the Fund;
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ARCO Investment Management is a specialist Australian equity investment manager and the Fund has a long/short equity strategy typically with a low but variable net market exposure comprising 40 to 65 stocks broadly selected from within the ASX200.
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The investment team comprising George Colman, Peter Whiting, and Stephen Nicholls bring 100 years combined experience in equity markets.
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The Fund has an annualised return since inception of +8.43%. The Fund's approach to risk is shown by the Sharpe ratio of 1.41 (Index 0.27), Sortino ratio of 2.95 (Index 0.28), both of which are well above the ASX 200 Accumulation Index and has recorded over 79% positive months.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - March 2018 (pdf format)
Fund Review: Bennelong Long Short Equity Fund March 2018
12 Apr 2018 - Australian Fund Monitors
Latest Fund Review for the Bennelong Long Short Equity Fund is now available. The Fund is a research driven, market and sector neutral, "pairs" trading strategy investing primarily in large-caps from the ASX/S&P100 Index, with over...
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12 Apr 2018 - Fund Review: Bennelong Long Short Equity Fund March 2018
By: Australian Fund Monitors
AFM Fund Review - March 2018 (pdf format)
BENNELONG LONG SHORT EQUITY FUND
Attached is our most recently updated Fund Review on the Bennelong Long Short Equity Fund.
- The Fund is a research driven, market and sector neutral, "pairs" trading strategy investing primarily in large-caps from the ASX/S&P100 Index, with over 15-years' track record and an annualised returns of over 16%.
- The consistent returns across the investment history indicate the Fund's ability to provide positive returns in volatile and negative markets and significantly outperform the broader market. The Fund's Sharpe Ratio and Sortino Ratio are 1.00 and 1.64 respectively.
For further details on the Fund, please do not hesitate to contact us.
AFM Fund Review - March 2018 (pdf format)
Performance Report: Paragon Australian Long Short Fund
11 Apr 2018 - Australian Fund Monitors
The Paragon Australian Long Short Fund returned -4.7% in March. Since inception in March 2013, the Fund has returned +17.34% per annum versus the ASX200 Accumulation Index's +7.05% per annum.
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11 Apr 2018 - 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 | Positive contributors in March included Dacian Gold, Global Geoscience and the Fund's shorts in Invocare, Mineral Resources, Aurizon and Telstra. These were offset by declines in several holdings, driven by the market sell-off, including Orocobre, Cimic, Wattle Heath, Metals X, Echo and Paragon's Cobalt holdings. Paragon ended the month with 30 long and 26 short positions. Paragon's view is that the mood across global markets remains in fear territory, with March exhibiting high levels of volatility once again. In order to best navigate this period of volatility, Paragon increased the Fund's hedges through March and further reduced their net exposure. They also noted that, while ongoing volatility presents certain challenges, they continue to embrace the opportunities that come with it, identifying new stocks for the Fund. |
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Performance Report: MHOR Australian Small Cap Fund
10 Apr 2018 - Australian Fund Monitors
The MHOR Australian Small Cap Fund fell -1.36% in February. Since inception in August 2016, the Fund has returned +14.64% per annum.
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10 Apr 2018 - Performance Report: MHOR Australian Small Cap Fund
By: Australian Fund Monitors
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| Fund Overview | MHOR looks for investment that exhibit the following set of characteristics: -Opportunity - to take advantage of growth and positive alignment with industry themes and trends. -Quality business - competitively advantaged product or service offering. -Financial flexibility - appropriately resourced to capture its opportunity. -Management - with the vision and capability to bring it all together. -Fundamentally undervalued. MHOR also considers labour standards, environmental, social and ethical considerations when making investment decisions but only to the extent that these factors impact the assessment of risk or return. The minimum suggested investment timeframe is 3-5 years. |
| Manager Comments | Positive contributors included SPZ, NWH & IMD. Notable detractors were TBH & DUB. The Fund exited the month with 32 stocks and 10% cash. MHOR noted the portfolio performed in line with the market during the downdraft. They went into results season with a target list of potential actionable ideas and, from this list and others, deployed 10% of the fund's cash throughout the season. This allowed MHOR to gain conviction on some stocks and top up holdings, as well as rotate into new ideas and away from stocks where MHOR's assessment had changed. Cyclical stocks caught MHOR's attention the most, they noted. The Mining Services Sector remains foremost in their thinking with much repaired balance sheets, improved operational visibility, reasonable valuation and consensus expectation framework as well as a more limited competitor set than the prior resources peak. This sector remains MHOR's largest overweight. With respect to valuation and expectation, MHOR found Media and Retail to be interesting ahead of results. |
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Fund Review: Insync Global Titans Fund February 2018
9 Apr 2018 - Australian Fund Monitors
Latest Fund Review on Insync Global Titans Fund is now available. 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...
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9 Apr 2018 - Fund Review: Insync Global Titans Fund February 2018
By: Australian Fund Monitors
AFM Fund Review - February 2018 (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 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 - February 2018 (pdf format)
Performance Report: Pengana Global Small Companies Fund
6 Apr 2018 - Australian Fund Monitors
The Pengana Global Small Companies Fund returned +0.23% for February, outperforming its benchmark which was down -0.40%. Since inception in April 2015, the Fund has returned +11.6% per annum with a volatility of 8.38%.
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6 Apr 2018 - Performance Report: Pengana Global Small Companies Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is managed by Founder & CIO Leah Zell, and Portfolio Managers Jon Moog and David Li. The Lizard investment team have over 50 years combined investment experience in global small cap investing. Leah Zell has over 30 years of experience and is a recognized expert in international investing in the international small-cap category. The Fund's investment team uses a value-oriented investment approach to small and mid-cap global equities that seeks to identify and invest in quality businesses that create significant value but are mispriced, overlooked or out-of-favour. The investment manager believes that unique opportunities exist due to limited available research, corporate actions or unfavourable investor perception. The portfolio construction process aims to develop portfolios that incorporate the best investment ideas from the investment manager's research while allowing for liquidity constraints and perceived risk. The Fund's investment manager will not typically hedge currency exposures, however during periods of currency extremes, some currency hedging may be employed. Derivatives may be used to achieve long or short exposures, reduce risk and reduce transaction costs. Derivatives will not be used for the purposes of leverage and the Fund's net exposure will never be short. |
| Manager Comments | Pengana exited one position in February due to concerns regarding the depth of the management team and financial controls they employed. Pengana noted that, despite the company being a good business, they are not prepared to take the risk of weak management. Pengana have initiated a new position in the food industry. Pengana mention that they are currently not seeing widespread opportunities to allocate capital across current or new investments. In last month's report the Manager highlighted the option value of cash, in this month's report they note the value of this option is greater than ever. |
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Performance Report: Bennelong Concentrated Australian Equities Fund
5 Apr 2018 - Australian Fund Monitors
The Bennelong Concentrated Australian Equities Fund rose +1.89% in February, taking annualised performance since inception to +18.36%.
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5 Apr 2018 - Performance Report: Bennelong Concentrated Australian Equities Fund
By: Australian Fund Monitors
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| Fund Overview | The overriding objective of the Concentrated Australian Equities Fund is to seek investment opportunities which are under-appreciated and have the potential to deliver positive earnings, while satisfying our stringent quality criteria. Bennelong's investment process combines bottom-up fundamental analysis together with proprietary investment tools which are used to build and maintain high quality portfolios that are risk aware. The portfolio typically consists of 20-35 high-conviction stocks from the S&P/ASX 300 Index. The Fund may invest in securities listed on other exchanges where such securities relate to ASX-listed securities. Derivative instruments are mainly used to replicate underlying positions and hedge market and company specific risks. |
| Manager Comments | By the end of the month the Fund's weightings had been increased in the Health Care and Materials sectors and decreased in the Discretionary, Consumer Staples, Industrials and Financial sectors. The Fund's top 3 holdings as at the end of February were CSL, Flight Centre Travel and BHP Billiton. |
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Performance Report: Insync Global Titans Fund
4 Apr 2018 - Australian Fund Monitors
The Insync Global Titans Fund rose +1.19% in February, outperforming the MSCI ex Aus Index by +1.66%. Since inception in October 2009, the Fund has returned +10.07% per annum after the cost of fees and protection.
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4 Apr 2018 - Performance Report: 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 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. Insync continue to utilise put options to buffer sharp falls in equity markets. |
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Performance Report: Pengana PanAgora Absolute Return Global Equities Fund
3 Apr 2018 - Australian Fund Monitors
The Pengana PanAgora Absolute Return Global Equities Fund returned -1.20% in February. Since inception in September 2010, the Fund has returned +8.35% per annum with an annualised volatility of 5.32%.
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3 Apr 2018 - Performance Report: 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 long-term portfolio detracted -0.87% with most of the underperformance coming from the U.S. large capitalisation stocks. Intermediate-terms strategies detracted -0.45%, while short-term strategies contributed +0.11%. In the long-term portfolio, detractors included Spirit AeroSystems and Edgewell Personal Care, both of which remain long positions in the portfolio due to their good alpha scores. International positions in developed markets contributed +0.47% with good performance coming from Europe, in particular the UK and Sweden. Emerging Markets positions contributed +0.14%, with South Africa and Turkey contributing the most. The intermediate strategies detracted -0.36% due to U.S. merger arbitrage related trades where spreads widened in a volatile market. Pengana noted that this presents an opportunity to enter in to new trades at attractive levels. The short-term strategies contributed +0.09%, primarily due to good performance coming from Pengana's Analyst Day strategy. |
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Performance Report: Touchstone Index Unaware Fund
2 Apr 2018 - Australian Fund Monitors
The Touchstone Index Unaware Fund fell -1.57% in February. Since inception in April 2016, the Fund has returned +13.47% per annum.
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2 Apr 2018 - Performance Report: Touchstone Index Unaware Fund
By: Australian Fund Monitors
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| Fund Overview | The portfolio is constructed using Touchstone's Quality-At-a-Reasonable-Price ('QARP') investment process. QARP is a fundamental bottom-up process, however, it also incorporates a top-down risk management framework designed to successfully manage the portfolio during varying market conditions and economic cycles. The Touchstone Fund is concentrated, typically holding between 15-20 stocks. No individual stock will ever make up more than 10% of the portfolio at any one time. The Investment Manager may temporarily exceed the exposure limits of the Fund occasionally, particularly during periods of market volatility, to allow for holdings in excess of this 10% limit where the increase in value of the underlying security is due to market movement. The Fund may also hold between 0-50% of the portfolio in cash. The Fund has a high level of associated risk, therefore, the minimum suggested investment time-frame is 5 years. |
| Manager Comments | The Touchstone Index Unaware Fund primarily selects stocks from the S&P/ASX 300 Index and typically holds 10-30 stocks. It seeks to invest in reasonably priced, good quality companies with a significant share of expected returns coming from sustainable dividends. |
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