NEWS
17 Nov 2015 - APN Asian REIT Fund
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Fund Overview | Pete Morrissey and Corrine Ng are the Portfolio Managers of the Fund. Morrissey has over 15 years financial markets experience and joined APN in 2006. Previously, he worked at Lonsec and also managed an internationally focused private investment fund as well as spending several years as an analyst in the UK for Nomura, amongst others. He has also completed Masters level academic research papers on both commercial real estate cycles and global property cycles. Ng also has a strong background in property and REITs in Australia, Asia and the North American markets. Prior to joining APN, Ng worked for Aviva Investors (Senior Investment Analyst, North America Real Estate Securities Team) and Goldman Sachs & Co (Vice President, Goldman Sachs Asset Management Real Estate Securities Team) in New York. 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 is expected to be dynamic as 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 focuses on passive rental earnings derived from well managed Asian REITs listed in mature capital markets and will not invest in infrastructure, property development companies or stocks with a 'loose association with property'. 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. The Fund is suited to medium to long term investors seeking a relatively high income and some capital growth over the long term. |
Manager Comments | The Fund's portfolio was geographically allocated in multiple Asian countries, with majority in Japan (38.3%) and Singapore (29.1%). Over 65% of the Fund allocation was invested in Retail REITs (40.1%) and Office REITs (25.2%) sectors. Top 5 Asian REIT holdings were in Croesus Retail Trust, Keppel Dc REIT, N, Capitaland Retail China Trust, Gip J-REIT and Mapletree Commerical Trust. Click below to read the latest Fund's performance report. |
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16 Nov 2015 - Laminar Credit Opportunities Fund
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Fund Overview | The Fund may also invest in derivatives for hedging purposes. The portfolio of the Fund comprises primarily Investment Grade holding of 75% of the Fund's assets. Benchmark allocations are Australasia 50% to 100%, North America 0% to 50% and Europe 0% to 50%. Currency hedging may take place depending on benefits to the Fund. |
Manager Comments | Since inception, the Fund has an annualised return of 18.11% p.a (RBA Cash Rate Index 3.39% p.a), to give notable Sharpe and Sortino Ratio of 1.91 and 18.96 respectively. Majority of the Fund's portfolio composition was in Residential Mortgage Backed Securities (RMBS) at 66%, followed by Short-dated loans at 21%. Click on the link below to read the latest Fund Manager's Report. |
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13 Nov 2015 - Bennelong Kardinia Absolute Return Fund
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Fund Overview | 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 | Vitaco, Aristocrat and BT Investment Management were the largest positive contributors to performance, whilst a short position in Share Price Index Futures, Telstra and National Australia Bank were the largest detractors. Net equity market exposure (including derivatives) was increased to 58.9% (72.8% long and 13.9% short). Click below to read the October 2015 Fund Report. |
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12 Nov 2015 - Jamieson Coote Bonds Active Fund
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Fund Overview | JCBAF seeks to establish a mid to long term core portfolio using both domestic and global macroeconomic analysis. This is overlaid with a number of valuation indicators and international market intelligence from a global network of market moving investors, including central bankers and hedge funds, to construct an optimal indexed portfolio allocation at any given time. The Fund recognises short term oscillations driven by technical factors and supply dynamics create opportunities within short term pricing cycles, which can generate significant alpha when managed within a risk adjusted framework. The Fund aims to outperform its index using duration and curve management at appropriate times in the pricing cycle whilst retaining a core long. The JCB Active Fund gives direct access to the management team whilst providing portfolio balance with increased capital stability and a fixed income streams with both income and principle repayment secured by the Australian or State Governments. |
Manager Comments | New bond issuance provided the best trading opportunities of the month with large supply concessions available in the new 24yr ACGB 39's and new 13yr TCV 28's bond which generated the majority of our performance. The Fund set steepening exposure throughout the month and will retain through the November RBA meeting. At month-end, the portfolio mix was adjusted resulting in higher holding (53.67%) of Semi (State) Government Bonds, followed by 27.80% in the Australian Government Bonds, with average duration of 4.47 years. Click below to read the Fund's monthly performance and Fund Managers market outlook. |
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12 Nov 2015 - Fund Review: Bennelong Long Short Equity Fund October 2015
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 cap stocks from the ASX/S&P100 Index, with over thirteen year track record and annualised returns of 18.25%.
- The consistent returns across the investment history indicates 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 1.11 (Index 0.30) and 1.91 (Index 0.31) respectively.
11 Nov 2015 - Morphic Global Opportunities Fund
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Manager Comments | According to the Fund Manager, the under-performance of the Fund against its benchmark, can be attributed to three main factors: 1) carrying cash, which is a performance drag in strongly rising markets; 2) style under-performance; and 3) adverse stock outcomes. However, the Fund's biggest win once again came from their large market neutral US Banks position. Other smaller win included a merger-arbitrage position on Australian document storage firm Recall. For the month, the Fund had over 54% of their equity exposure in the North American region and over 20% in the Financials Sector. Click below to read the Fund Manager's monthly report and their September outlook of the market. |
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10 Nov 2015 - Fund Review: Meme Australian Share Fund October 2015
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The Meme Capital Management is a Perth-based boutique Fund Manager, established in 2012 and manages the Meme Australian Share Fund.
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The Fund specializes in technical and quantitative strategies to identify investment opportunities expected to provide both positive price appreciation and relative price out-performance over the medium to long term.
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The Fund's objective is to outperform the S&P/ASX All Ordinaries Accumulation Index over rolling three year periods, through investing in ASX listed securities outside the S&P/ASX 20. The Fund only takes long positions and does not use derivatives.
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Over the past 12 months, the Fund returned positive 17.11%, versus the Index's 8.51% return.
10 Nov 2015 - The Paragon Fund
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Fund Overview | Paragon believes that markets are not always efficient, exhibiting a common tendency to price securities well outside of their intrinsic value over the medium term. This market characteristic provides the opportunity for Paragon, an active manager with a flexible mandate, to generate superior investment returns over the longer term. Paragon believes that it is critical to understand both the companies and the industries in which they operate, in order to fully comprehend each investment opportunity. Accordingly, a fundamental approach to company research is taken. Assessing the potential downside is also paramount in framing the risk/reward trade-off for potential investments. |
Manager Comments | Key positive contributors for October included Longs in Macquarie Group, Henderson Group, NetComm Wireless, APN Outdoor, and Amaysim while detractors included our short positions in general given the strong market. At the end of the month the Fund had 30 long positions and 15 short positions. Click below to read the latest Fund Manager's commentary. |
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9 Nov 2015 - Optimal Australia Absolute Trust
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Fund Overview | 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 | The Fund was slightly net long invested during October, but reduced exposure into the rally. The Fund's return was very much driven by stock selection. The long positions strongly outperformed the market, with attribution of +4.1% on average long exposure of 52% of NAV. Key contributors included financials, retail, and commodity group. Short positions were difficult in such a strong market, with attribution of -2.1% on average short (stock) exposure of 29.4%. Click below to read the latest Fund Monthly Report. |
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7 Nov 2015 - Hedge Clippings
Title: GST reform firmly and (finally) on the agenda. What's next?
This week it seems the GST hit the press (and hopefully not the fan) in no uncertain terms. Regular readers of "Hedge Clippings" might recall that an increase (and broadening) of the GST has been one of our hobby horses since before Joe Hockey's first budget, so we'd like to think someone has at last been listening, but we might be deluding ourselves on that count. In any event now it is on the front pages it is probably time for us to move on, and leave it to Malcolm Turnbull and Scott Morrison to battle it out with Bill Shorten. As unfair a match as that might be, we will all be heartily sick of the argument by the time of the next election.
So while reform of taxation is on the table, and reform of superannuation concessions a part of that, it is worth re-visiting the argument for tying Australia's super retirement pool to the need for increased spending on infrastructure. Taking some basic figures, the total value of Superannuation assets as at the end of June was just over $2 trillion. Research from Deloitte estimates that this will reach $7.6 trillion by 2033.
The taxation of treatment of superannuation has always been generous, partly as an incentive to encourage its initial adoption, and partly as a gift from John Howard and Peter Costello to reward the faithful along the way. There's little doubt this generosity will come under pressure in any taxation review, but the government could introduce a part carrot/part stick approach to encourage/enforce a slice of all superannuation accounts to invest in the currently underfunded infrastructure sector.
By setting a minimum percentage of all super balances (say 10%) to be invested in infrastructure bonds, with a low but steady return (say CPI plus 3-5%), with an appropriate taxation incentive for doing so, two objectives might be achieved at once. At 10% of all balances it would provide $200 billion at current levels, increasing to $760 billion by 2033. In reality at those levels there would be a shortage of projects by that time, but there could be worse problems to have.
Airports, roads, rail, water and power projects all come to mind. All it takes will be some vision, then political commitment, and finally electoral acceptance. Hopefully we now have the prospect of enough of all three to generate the debate.
As usual in the first week of each month there were limited results received, but included the following PERFORMANCE UPDATES:
FUND REVIEWS released this week: Insync Global Titans Fund; Supervised High Yield Fund
Finally we hope you enjoyed this week's Melbourne Cup, and congratulations to the first winning female jockey in the Cup's history. Now for something completely different, this news item regarding the obedient, but not too quick on his feet, bank robber in the USA.
And on that note, I trust you have a safe and enjoyable week-end.
Regards,
Chris
CEO, AUSTRALIAN FUND MONITORS
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