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 Fund returned 3.5% for the month of October. The performance was driven by positive contributions from our holdings in Microsoft, Medtronic, McDonald's and Zimmer. The Fund continues to have no foreign currency hedging in place as Insync consider that the risk to the Australian dollar continues to be on the downside.

• 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.

Australian Fund Monitors

ATTACHED FILESInsync Global Titans Fund AFM Monthly Report - October 2015 (pdf format)

AURORA FORTITUDE ABSOLUTE RETURN FUND

Attached is our most recently updated Fund Review on the Aurora Fortitude Absolute Return Fund.

We would like to highlight the following aspects of the Fund;

• The Aurora Fortitude Absolute Return Fund  (AFARF) has a 10 year track record investing in ASX listed equities. A Market Neutral overlay is used across a multi strategy approach which allows for flexible asset allocation to maximise returns and minimise risk under a variety of market conditions and cycles.CIO John Corr has over 20 years financial market experience with a strong focus on risk.

• Significant use of low risk "long" derivatives and option overlays has provided positive returns with low volatility during periods of market dislocation. Risk statistics are impressive and shows the Funds risk philosophy; 85% of monthly performances have been positive with no losing months in 2008, the Fund's largest drawdown is -2.09% and the Sharpe ratio 1.09.

• ASX listed Aurora Funds Limited was established on the merger of three existing fund management businesses, managing approx. $230m on behalf of more than 2,500 retail and wholesale investors.

Australian Fund Monitors

ATTACHED FILESAurora Fortitude Absolute Return Fund AFM Review October 2015 (pdf format)

Are we turning Japanese?

The experts are telling us that we are facing the first US rate rise in nearly seven years. However it is worth remembering we've been here before, with expectations for a Fed tightening having been on the cards for at least the past 18 months. Each time they've pulled back from the brink, either because the market reaction was so savage, or a more recent statistic or world event cut them off at the pass.

So we would have to ask the question, will it be any different this time around? And if it is, what's in store beyond the first upward move, considering that interest rate movements rarely, if ever, occur in isolation?

The reality is that the world's economy is in a very different place, and what might have occurred in the past is not occurring now. Maybe we're fixated by the recent past, rather than the distant, or the reality of the present, but the feeling is that as and when US rates do start to climb, they will struggle to get far beyond 1% in the foreseeable future.

Now one percent might not seem much, but given there's been so much debate and consternation about the first 0.25% (or maybe it will only be 0.125%) rise, one percent represents at least four rate rises. Could it be that the Japanese experience of the past 20 years is going to be reflected across the Pacific? 

Japan has effectively had a debt overhang, having never cleared their debts of the '80's. Allied with a demographic problem, Japan has struggled to record any meaningful growth since the early 1990's. The US may be different, but is the world's economy facing the same future as Japan, and are we all turning Japanese as a result.

Performance updates and reviews received this week included the following PERFORMANCE UPDATES:

APN AREIT Fund rose 4.43% in October to bring annualised return since inception to 17.90% p.a.

Insync Global Titans Fund rose 3.5% in October, to take their 12 month return to 22.02%

In October, KIS Asia Long Short Fund rose 2.50%, to bring the Fund's annualised return since inception 15.16%.

Freehold Absolute Return Fund delivered a positive 1.29% for the month of October, to take their 24 month return to 26.97%.

The Supervised High Yield Fund produced a return of +0.54% for the month of October, to bring annualised performance since inception to 9.87% p.a.

FUND REVIEWS released this week:Pengana Absolute Return Asia Pacific Fund; Totus Alpha Fund; APN Asian REIT Fund;

And on that note, I trust you have a safe and enjoyable week-end.

Regards,

Chris
CEO, AUSTRALIAN FUND MONITORS

Connect with me on LinkedIn Twitter Facebook

• APN is an ASX-listed fund manager specialising in property investment, with an investment team of six. Established in 1996, APN now has FUM of $A2.1bn including four REIT (Real Estate Investment Trust) funds.
• The APN Asian REIT Fund (Fund) is a property securities fund that invests in a quality portfolio of Asian REITs, listed on the securities exchanges of the Asian Region, with the ability to hold some cash and fixed interest investments. 
• The Fund aims to deliver a competitive yield with lower risk than the market. The underlying stocks are selected based on a highly disciplined investment approach that focuses on the fundamentals and number of valuation approaches. The universe can include new IPO's, other corporate actions take place and / or corporate governance improvements at country or REIT level bring new stocks into focus.
• The Fund provides access to a wide spread of property-based revenue streams that are specifically analysed, selected and weighted with the aim of delivering strong and sustainable income returns. The Fund is an unhedged product.
• APN's Asian REIT Fund invests in a portfolio of 25-40 listed Asian REITs with a core philosophy of investing in properties with a sustainable rental income streams.
• The Fund has delivered an annalised return of 17.96% p.a., since inception in July 2011 with standard deviation of 9.11% p.a. The Sharpe and Sortino ratios are 1.54 and 2.96 respectively.

ATTACHED FILESAPN Asian REIT Fund AFM Fund Review September 2015 (pdf format)

• Totus Capital is a Sydney based long short fund manager established in 2012 by Ben McGarry which aims to place equal emphasis on performance and capital preservation.  The Fund invests mainly in Australia, but also in other developed economies, with a primary exposure to equity markets.
• The Totus Alpha Fund's investment strategy is to identify structural themes, and then seek to drive performance by investing in securities that have concentrated exposure to those themes.  Single stock short positions are used to generate alpha, frequently in under researched parts of the market such as the small and mid-cap space. Index derivatives are used to hedge the portfolio's market risk.
• McGarry qualified as a Chartered Accountant with PWC in 1999 and has 14 years market experience, commencing his career covering European building materials and construction sectors at Morgan Stanley in London. Previous experience included analytical roles at Ausbil, a Sydney based $10bn+ long-only manager, and sell side emerging companies experience at UBS. McGarry's emerging company research with UBS included exposure to a range of sectors including energy, materials, industrials, tech, financials, retail and telecommunications.
• The Fund has delivered an annalised return of 30.14% since inception in March 2012 as compared to 10.18% for the ASX 200 Accumulation Index. The standard deviation has been higher than the Index at 14.04% as compared to 12.31% and the Sharpe ratio is 1.77.  

ATTACHED FILESTotus Alpha Fund AFM Fund Review October 2015 (pdf format)