NEWS
Performance Report: Bennelong Long Short Equity Fund
11 Jun 2021 - Australian Fund Monitors
The Bennelong Long Short Equity Fund returned 0.12% in May, taking annualised performance since inception in January 2003 to +14.28% vs the ASX200 Accumulation Index's +9.13%.
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11 Jun 2021 - Performance Report: 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 as a Listed Investment Company (LIC) on the ASX. |
| Manager Comments | The fund's Sharpe ratio has ranged from a high of 0.85 since inception, to a low of -0.21 over the past 12 months. Its Sortino ratio (which excludes volatility in positive months) vs the index has ranged from a maximum of 1.34 vs. the index's 0.5 since inception to -0.4 vs. the index's 6.77 over the past 12 months. In May, individual pair contribution was generally modest. The number of negative pairs exceeded positive pairs. Ongoing rotation into lower rated companies was a headwind for the fund, offset by some excellent company results. ALQ/AZJ was the Fund's top pair, with ALQ reporting a strong full year result. All segments are growing and the company has dealt with the difficult environment of the last year very well. ALL/SGR was the Fund's second-best pair with Aristocrat reporting a strong result, well ahead of market forecasts. Bennelong noted Aristocrat is enjoying the payoff from years of consistent and productive investment in both its land based and digital divisions. |
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Performance Report: Vantage Private Equity Growth 4
3 Jun 2021 - Australian Fund Monitors
Prior Vantage Funds continue to perform well with March seeing a composite performance of +2.80%. Quarterly performance was +14.23% and 12 month performance +60.23%. This strong performance was achieved as a result of the sale or IPO / ASX...
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3 Jun 2021 - Performance Report: Vantage Private Equity Growth 4
By: Australian Fund Monitors
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| Fund Overview | These businesses typically have a strong market position and generate strong cash flows, which will allow the Fund to generate strong consistent returns to investors, while significantly reducing the risk of a loss within the portfolio. The Fund will invest in Private Equity funds based in Australia, along with Permitted Co-investments, to create a well diversified portfolio of Private Equity investments. These investments will be made by the Fund, by making Commitments to the Private Equity funds of the best performing Private Equity fund managers, that in turn make investments into profitable companies requiring Later Expansion and Buyout capital to accelerate their growth and enhance their value. |
| Manager Comments | VPEG4 portfolio managers continued to build upon their successful prior acquisitions of Alpha-H and Independent Living Specialists ('ILS'). Australian owned and operated, Alpha-H develops and manufactures corrective and preventative skincare products and is a global phenomenon, stocked in over 40 countries including prestige clinics, exclusive day spas, TV shopping networks, cosmetic giant Sephora, department stores Marks & Spencer, Myer and Harvey Nichols and a selection of premium airlines. Alpha-H's expansion into the US market continues to deliver positive signs with strong Direct-to- Customer sales emerging from Alpha-H's Online Channel. ILS is a leading Australian supplier and registered NDIS provider of hospital and home-care equipment. Founded in 2004, ILS has accelerated its growth in recent years by taking advantage of favourable market and government funding conditions to expand both its retail and clinical services divisions. During the period ILS completed the acquisition of Complete Mobility, the second add-on investment since acquisition. Complete Mobility reinforces ILS's presence in Far North Queensland with three regional sites, increases scale in complex rehabilitation and offers both supply and cost synergies to ILS. This acquisition adds to the geographic coverage and product range for this key segment of the market. Vantage's pipeline of Private Equity investment opportunities remains strong and expects the VPEG4 portfolio to continue to grow in value across 2021. Please note that performance for the Vantage Private Equity Funds composite is updated quarterly. |
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Performance Report: Insync Global Quality Equity Fund
1 Jun 2021 - Australian Fund Monitors
The Insync Global Quality Equity Fund rose +5.59% in April, outperforming AFM's Global Equity Index by +2.85% and taking 12-month performance to +22.05%. Since inception in October 2009, the Fund has returned +14.00% p.a. with an...
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1 Jun 2021 - Performance Report: Insync Global Quality Equity 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 typically of 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. |
| Manager Comments | The Fund's capacity to protect investors' capital in falling and volatile markets is highlighted by the following statistics (since inception): Sortino ratio of 2.00 vs the Index's 1.45 and down-capture ratio of 69.16%. At month-end, the portfolio's top 10 holdings included PayPal, Qorvo Inc, Domino's Pizza, Walt Disney, S&P Global, Nvidia, Facebook, Accenture, Visa and Qualcomm. The portfolio was most heavily weighted towards the 'Contactless Economy' and 'Workplace Automation' megatrends. By sector, the portfolio was significantly overweight the IT sector relative to the MSCI. |
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Performance Report: Bennelong Concentrated Australian Equities Fund
28 May 2021 - Australian Fund Monitors
The Bennelong Concentrated Australian Equities Fund rose +5.45% in April, outperforming the ASX200 Accumulation Index by +1.98% and taking 12-month performance to +42.03% vs the Index's +30.76%. Since inception in February 2009, the Fund...
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28 May 2021 - 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 | The Fund's Sharpe and Sortino ratios (since inception), 0.97 and 1.42 respectively, by contrast with the Index's Sharpe of 0.62 and Sortino of 0.79, highlight its capacity to produce superior risk adjusted returns while avoiding the market's downside volatility. The Fund's up-capture and down-capture ratios (since inception), 151.55% and 91.58% respectively, indicate that, on average, it has significantly outperformed during the market's positive months while typically not falling further than the market during the market's negative months. The Fund has achieved up-capture ratios greater than 120% and down-capture ratios less than 100% over the past 12, 24, 36, 48 and 60 months. The portfolio ended the month significantly overweight the Discretionary sector (Fund weight: 43.0%, benchmark weight: 8.0%) and underweight the Financials sector (Fund weight: 6.7%, benchmark weight: 29.2%). |
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Fund Review: Insync Global Capital Aware Fund April 2021
27 May 2021 - Australian Fund Monitors
Latest Fund Review on Insync Global Capital Aware Fund is now available. The Global Capital Aware Fund invests in a concentrated portfolio of 15-30 stocks, targeting exceptional, large cap global companies with a strong focus on dividend...
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27 May 2021 - Fund Review: Insync Global Capital Aware Fund April 2021
By: Australian Fund Monitors
AFM Fund Review - April 2021 (pdf format)
INSYNC GLOBAL CAPITAL AWARE FUND
Attached is our most recently updated Fund Review on the Insync Global Capital Aware Fund.
We would like to highlight the following:
- The Global Capital Aware 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 - April 2021 (pdf format)
Performance Report: Frazis Fund
27 May 2021 - Australian Fund Monitors
The Frazis Fund rose +1.20% in April, taking 12-month performance to +133.80% vs AFM's Global Equity Index's +23.22%. Since inception in July 2018, the Fund has returned +29.41% p.a. vs the Index's +12.80%.
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27 May 2021 - Performance Report: Frazis Fund
By: Australian Fund Monitors
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| Fund Overview | The manager follows a disciplined, process-driven, and thematic strategy focused on five core investment strategies: 1) Growth stocks that are really value stocks; 2) Traditional deep value; 3) The life sciences; 4) Miners and drillers expanding production into supply deficits; 5) Global special situations; The manager uses a macro overlay to manage exposure, hedging in three ways: 1) Direct shorts 2) Upside exposure to the VIX index 3) Index optionality |
| Manager Comments | The Fund's up-capture ratio (since inception) of 237.1% indicates that, on average, it has returned more than twice as much as the market during the market's positive months. The Fund has achieved up-capture ratios over the past 12 and 24 months of 355.9% and 271.6% respectively. Frazis noted that there was a further sell-off in growth stocks that seems to have stabilised. Multiples are down approximately 50% from the start of the year, using estimates for 2021. They added that the latest fall was triggered by a US inflation print of 4%. Frazis believe that inflation is likely to benefit the Fund's companies as they all have extensive pricing power. Frazis' view is that, irrespective of the growth vs value debate, the value of the portfolio's companies will be driven by fundamentals as they increase their user base, gross profit dollars, and in the case of life sciences, bring additional treatment to market. |
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Performance Report: Insync Global Capital Aware Fund
26 May 2021 - Australian Fund Monitors
The Insync Global Capital Aware Fund rose +5.42% in April, outperforming AFM's Global Equity Index by +2.68% and taking 12-month performance to +17.82%. Since inception in October 2009, the Fund has returned +11.99% p.a. with an annualised...
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26 May 2021 - Performance Report: Insync Global Capital Aware 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's capacity to protect investors' capital in falling and volatile markets is highlighted by the following statistics (since inception): Sortino ratio of 1.80 vs the Index's 1.45, maximum drawdown of -10.98% vs the Index's -13.59%, and down-capture ratio of 61.74%. At month-end, the portfolio's top 10 holdings included PayPal, Qorvo Inc, Domino's Pizza, Walt Disney, S&P Global, Nvidia, Facebook, Accenture, Visa and Qualcomm. The portfolio was most heavily weighted towards the 'Contactless Economy' and 'Workplace Automation' megatrends. By sector, the portfolio was significantly overweight the IT sector relative to the MSCI. |
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Performance Report: Prime Value Emerging Opportunities Fund
26 May 2021 - Australian Fund Monitors
The Prime Value Emerging Opportunities Fund rose +6.95% in April, outperforming the ASX200 Accumulation Index by +3.48% and taking 12-month performance to +54.92% vs the Index's +30.76%. Since inception in October 2005, the Fund has...
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26 May 2021 - Performance Report: Prime Value Emerging Opportunities Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is comprised of a concentrated portfolio of securities outside the ASX100. The fund may invest up to 10% in global equities but for this portion typically only invests in New Zealand. Investments are primarily made in ASX listed and other exchange listed Australian securities, however, it may also invest up to 10% in unlisted Australian securities. The Fund is designed for investors seeking medium to long term capital growth who are prepared to accept fluctuations in short term returns. The suggested minimum investment time frame is 3 years. |
| Manager Comments | The Fund's Sharpe and Sortino ratios (since inception), 1.00 and 1.40 respectively, by contrast with the Index's Sharpe of 0.69 and Sortino of 0.83, highlight its capacity to produce superior risk adjusted returns while avoiding the market's downside volatility. The Fund's up-capture and down-capture ratios for performance over the past 12 months, 153% and -4.6% respectively, highlight its significant outperformance over that period in both the market's positive and negative months. Key positive contributors for the month were Mainstream (MAI +119.9%), Uniti Wireless (UWL +20.4%) and City Chic (CCX +17.6%). Key detractors were Redbubble (RBL -18.2%), Southern Cross Media (SXL - 9.9%) and Helloworld (HLO -13.0%). |
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Performance Report: Laureola Australia Feeder Fund
26 May 2021 - Australian Fund Monitors
The Laureola Master Fund returned 0.37% for April and is now up 0.9% YTD. The Fund has risen +8.51% over the past 12 months with a volatility of 2.15%. Since inception in May 2013, the Fund has returned +15.76% p.a. with an annualised...
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26 May 2021 - Performance Report: Laureola Australia Feeder Fund
By: Australian Fund Monitors
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| Fund Overview | Life Settlements are resold life insurance policies and can be thought of as a form of finance extended to an individual backed by the person's life insurance policy. This financing is repaid upon maturity by collecting the death benefit from the insurance company. Risk mitigation measures implemented by Laureola include science-driven due diligence of policies, active monitoring of insured through a vertically integrated operation, and investor aligned fund design. |
| Manager Comments | The Fund's Sharpe and Sortino ratios (since inception), 2.43 and 7.37 respectively, by contrast with the Index's Sharpe of 0.99 and Sortino of 1.49, highlight its capacity to produce superior risk adjusted returns while avoiding the market's downside volatility. The Fund's non-correlated nature is demonstrated by its consistently low down-capture ratios over all time periods. Its down-capture ratio since inception is -37.45%. A negative down-capture ratio indicates that, on average, the Fund has risen during the market's negative months. The Fund's capacity to protect investors capital is further highlighted by its maximum drawdown (since inception) of -4.90% vs the Index's -12.35% over the same period. The Fund has outperformed the Index in all 10 of the Index's 10 worst months since the Fund's inception. The April performance was due to the maturity of 3 small policies. Laureola emphasised in their latest report that the Fund has protected investors against inflation, even on an after-tax basis. They added that inflation can have negative effects on both traditional asset classes and on the real economy, especially at the end of the credit cycle. Laureola believe that under this scenario, the genuine non-correlated nature of the returns of the Fund will become valuable, as returns that depend on mortality will not be affected by slowdowns in the economy or by upheavals in the stock, bond, or currency markets. The Fund now holds 183 policies with a total face value of $131.8 ml. 35% of the insureds have LEs of 48 mos. or less, indicating that the Fund will continue to experience strong internally generated cash flow and a high level of realised gains. |
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Performance Report: Premium Asia Fund
26 May 2021 - Australian Fund Monitors
The Premium Asia Fund rose +3.78% in April, taking 12-month performance to +45.68% vs AFM's Asia Pacific ex-Japan Index's +26.14%. Since inception in December 2009, the Fund has returned +13.03% p.a. vs the Index's +6.76%.
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26 May 2021 - Performance Report: Premium Asia Fund
By: Australian Fund Monitors
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| Fund Overview | The Fund is managed by Value Partners using a disciplined value-oriented approach supported by intensive, on-the-ground bottom-up fundamental research resulting in a portfolio of individual holdings, which are, in the view of Value Partners, undervalued and of high quality, on either an absolute or relative basis, and which have the potential for capital appreciation. The Fund will primarily have exposure to the equity securities of entities listed on securities exchanges across the Asia (ex-Japan) region, however, the Fund may also gain exposure to entities listed on securities outside the Asia (ex-Japan) region which have significant assets, investments, production activities, trading or other business interests in the Asia (ex-Japan) region as well as unlisted instruments with equity-like characteristics, such as participatory notes and convertible bonds. The Fund may also invest in cash and money market instruments, depositary receipts, listed unit trusts, shares in mutual fund corporations and other collective investment schemes (including real estate investment trusts), derivatives including both exchange-traded and OTC, convertible securities, participatory notes, bonds, and foreign exchange contracts. |
| Manager Comments | South Korean and Taiwanese information technology names were among the top performance contributors in the Fund last month, as global demand for technology products remains strong. Financials also gained, particularly a South Korean financial holding company, which became the top performance contributor. Its share price was boosted by the company's plan to list its mobile retail banking service subsidiary. The Chinese shipping companies sustained their strong momentum in April. A slight detraction came from some of the Fund's exposure in the China consumer discretionary names as sentiment was muted. However, Premium's outlook remains positive on some of these names, as they believe they will be beneficiaries of the expected ongoing economic recovery. Premium continue to be overweight in North Asia, as the market continues to provide better risk-reward opportunities relative to other parts of Asia, which are still working their way out of the pandemic. They noted that, while market fundamentals in China remain unchanged, more catalysts, particularly earnings, are needed to drive up positive sentiment. The manager's bottom-up approach suggests corporate fundamentals remain solid, and they continue to prefer companies with visibility in their earnings. |
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