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Printed: 08 December 2022 12:56 AM


08 Feb 2022 - Performance Report: Surrey Australian Equities Fund

Report Date08 February 2022
ManagerSurrey Asset Management
Fund NameSurrey Australian Equities Fund
StrategyEquity Long
Latest Return DateJanuary 2022
Latest Return-9.00%
Latest 6 Months-4.20%
Latest 12 Months5.96%
Latest 24 Months (pa)10.97%
Annualised Since Inception9.01%
Inception Date01 June 2018
FUM (millions)AU$18
Fund OverviewThe Investment Manager will be primarily focussed on investing in companies listed in the S&P/ASX Small Ordinaries Index while retaining capacity to invest up to 30% of the Fund in ASX listed companies outside this benchmark. The Investment Manager believes this approach offers attractive, under researched investment opportunities that can provide capital upside and growing dividend income over rolling 5-year periods.

The Investment Manager follows a defined investment process which is underpinned by detailed bottom up fundamental analysis, overlayed with sectoral and macroeconomic research. This is combined with an extensive company visitation program where we endeavour to meet with company management and with other stakeholders such as suppliers, customers and industry bodies to improve our information set.

Surrey Asset Management defines its investment process as Qualitative, Quantitative and Value Latencies (QQV). In essence, the Investment Manager thoroughly researches an investment's qualitative and quantitative characteristics in an attempt to find value latencies not yet reflected in the share price and then clearly defines a roadmap to realisation of those latencies.

Developing this roadmap is a key step in the investment process. By articulating a clear pathway as to how and when an investment can realise what the Investment Manager sees as latent value, defines the investment proposition and lessens the impact of cognitive dissonance. This is undertaken with a philosophical underpinning of fact-based investing, transparency, authenticity and accountability.
Manager CommentsThe Surrey Australian Equities Fund returned -9% in January, a difference of -2.65% compared with the ASX 200 Total Return Index which fell by -6.35%.

The Surrey Australian Equities Fund has a track record of 3 years and 8 months and therefore comparison over all market conditions and against its peers is limited. However, the fund has outperformed the ASX 200 Total Return Index since inception in June 2018, providing investors with an annualised return of 9.01% compared with the index's return of 7.9% over the same period.

On a calendar year basis, the fund hasn't experienced any negative annual returns in the 3 years and 8 months since the start of its track record. Over the past 12 months, the fund's largest drawdown was -9.79% vs the index's -6.35%, and since inception in June 2018 the fund's largest drawdown was -26.75% vs the index's maximum drawdown over the same period of -26.75%. The fund's maximum drawdown began in February 2020 and lasted 6 months, reaching its lowest point during March 2020. The fund had completely recovered its losses by August 2020.

The Manager has delivered these returns with 4.62% more volatility than the index, contributing to a Sharpe ratio which has fallen below 1 three times over the past three years and which currently sits at 0.49 since inception. The fund has provided positive monthly returns 83% of the time in rising markets and 7% of the time during periods of market decline, contributing to an up-capture ratio since inception of 126% and a down-capture ratio of 112%.
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