NEWS
18 Sep 2014 - Cor Capital Fund
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| Fund Overview | The Cor Capital Fund is a Multi- Asset Fund which combines a pre-determined strategic asset allocation with active but systemised rebalancing to generate returns and manage volatility whilst maintaining transparency and liquidity. The Fund strategy is not reliant on accurate market predictions, forecasts or timing for success. Returns are generated in a number of ways; 1) by maintaining sufficiently large positions in a diverse group of asset classes, 2) via the 'volatility harvesting' consequences of active rebalancing, and 3) from the offsetting behaviour of certain asset classes under specific conditions. The combined portfolio is expected to exhibit relatively low volatility and low turnover. In the interests of avoiding complexity, maintaining liquidity, and minimising reliance on third parties, the Fund strategy does not employ gearing, derivatives or short-selling. |
| Manager Comments | The main return contribution for August came following another strong month for fixed interest (+0.22%). Equities (+0.09%) and cash (+0.06%) also made positive contributions and precious metals (-0.27%) subtracted from returns. There were no changes to the Fund portfolio during the month as there were no breaches of the Fund's defined asset class limits. |
| More Information | » View detailed profile of this fund |
16 Sep 2014 - Aurora Fortitude Absolute Return Fund
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| Fund Overview | The Fund aims to produce positive returns irrespective of the direction of the share market. For each investment the manager considers the risk, the timeline of that risk occurring and then the potential return. Low transaction costs and liquidity are other important factors in the success and implementation of the strategies. |
| Manager Comments | Reserve Bank Governor, Glenn Stevens, commented during the month that "Volatility in many financial prices is currently unusually low" and this seems to heavily discount any possibility of interest rate rises or "other unforeseen event". This is a thematic that we have commented on a number of times in recent months as we strive to hedge our portfolio consistently using a strategy that relies on a degree of volatility and market uncertainty. We believe that it is the most appropriate strategy for the portfolio over the investment cycle, but particularly in the current environment where, as Governor Stevens highlights, a large portion of investors seem to be comfortable with current risk levels. The Fund returned +0.30%, and as is often the case during reporting season Options Protection delivered the bulk of these returns (0.32%). The most significant contributor was Suncorp Group which surprised the market with a "special dividend" on top of increasing its ordinary dividend payment. Conversely the Fund also benefited from the severe negative reaction to the BHP Limited announcement that it would spin off its mineral diversion but not conduct a buyback or pay a special dividend. |
| More Information | » View detailed profile of this fund |
16 Sep 2014 - AIMA Australia Hedge Fund Forum
AIMA AUSTRALIA HEDGE FUND FORUM
16 September 2014 at the Softiel Sydney Wentworth
The AIMA Australian Hedge Fund Forum is a non-profit hedge fund conference organised by the industry for the industry, featuring quality Australian and international speakers sharing insights, reflections, war-stories and facts with hedge fund managers and investors.
Register now for the AIMA Australian Hedge Fund Forum - a non-profit hedge fund conference organised by the industry for the industry, featuring quality Australian and international speakers sharing insights, reflections, war-stories and facts with hedge fund managers and investors, including:
- How can Hedge Funds generate Alpha from Australia?
- Lateral insights into global investment opportunities
- ASIC presentation of survey findings with Q&A
- Family Office Investor Panel - How do Australian Hedge Funds access local & international Family Offices?
- Hedge Fund Investing - current landscape and challenges
- Asset Consultants and Advisors - how do we work with hedge funds?
I look forward to welcoming you to this very important industry event.
For all enquiries, please contact:
Michael Gallagher
General Manager, AIMA Australia
M: +61 (0)412 224 400, E: [email protected], W: www.aima-australia.org
To register for the conference please click here.
12 Sep 2014 - Fund Review: Bennelong Alpha 200 Fund August 2014
- The Bennelong Alpha 200 Fund is a new fund opened in December 2013. The Fund is broadly modelled on the strategy used for Bennelong's original Equity Long Short Fund which uses a market neutral "pairs trading" approach to invest in Top 100 stocks, and which has been managed by Richard Fish since the inception of BLESM in 2002.
- The Alpha 200 Fund however primarily invests within the top 200 by market capitalisation, using a similar "pairs trading" approach while remaining broadly market neutral on a cost basis.
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The Fund will hold 70 - 90 stocks comprising 35 to 45 pairs,although it can hold up to 100 stocks and 50 pairs. Each pair contains one
long and one short position each of which is thoroughly researched and,where possible, from the same market sector. The pair positions are dollar neutral at cost, limited in terms of sector exposure, and give theportfolio a target beta of zero over time.
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In addition to Richard Fish, the team is composed of Sam Shepherd who joined BLESM from Credit Suisse, where he ran the Melbourne institutional equities desk. Shepherd's 20 year experience also covers JP Morgan and Norwich Investment Management. Tim Hall recently joined BLSEM as a specialist mid and small-cap portfolio manager to work on the expanded universe of the 200 Alpha Fund. The team is supported by experienced investment analyst, Sam Taylor.
Sean Webster
Research and Database Manager
Australian Fund Monitors
12 Sep 2014 - The Paragon Fund
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| Fund Overview | Paragon accepts that markets are not always efficient in pricing information into securities and that no one investment style works in every stage of the investment cycle. Subsequently Paragon adopts a top down thematic led approach to identify companies exhibiting sustainable or improving returns on capital driven by volume growth, pricing power and competitive advantages. Paragon utilises both quantitative analysis to provide probability weighted high/low/base case valuations and qualitative analysis in assessing management, the business model and likely direction of returns. Paragon will allocate assets to each investment opportunity based on a risk/reward profile. Positions have defined investment parameters and risk limits, which are then monitored on an ongoing basis. |
| Manager Comments | The Fund has a 12 month Sharpe ratio of 2.33 (Index 1.40) and Sortino ratio of 7.01 (2.79) with Up and Down Capture ratios of 1.46 and -1.16 respectively. At month-end the Fund was 81.7% long, 10.1% short and held 28.4% cash. Key drivers of the Paragon Fund performance for August included strong returns from Orocobre, Orora, G8 Education and our short position in JB Hi-Fi, offset by falls in our resource holdings, and Xero. At the end of August the fund had 21 long positions and 7 short positions. |
| More Information | » View detailed profile of this fund |
11 Sep 2014 - 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 recorded a Sharpe ratio of 2.14 (Index 1.40) and Sortino ratio of 4.80 (Index 2.79) and had 92% positive months over the last 12 months. Up and Down Capture ratios are 0.26 and -0.12. The Fund increased its net short exposure to equities through the month, driven less by fear of an imminent market correction than a sense that the relative-value argument for equities is getting very long in the tooth; while at current prices, we continue to find more stocks we want to short than own. The key challenge remains the cost of hedge protection. Our stock shorts were a net detraction from our performance, as these included a fair representation from the defensive/yield category. One effect of financial repression and the corresponding over-reach for yield and coupon income been to shift many of these stocks even further away from defensible wider valuation metrics. Our short index futures position was similarly ineffective this month, as the discount to the cash market narrowed sharply due to the ex-dividend effect. |
| More Information | » View detailed profile of this fund |
10 Sep 2014 - 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 | The domestic reporting season saw earnings generally in line with expectations. Dividend growth exceeded earnings growth as companies increased payout ratios. Net equity market exposure (including derivatives) averaged around 55% during the month, but was reduced to 36% at month end (65.2% long and 29.1% short) in anticipation of some seasonal weakness in September. |
| More Information | » View detailed profile of this fund |
9 Sep 2014 - Microequities Deep Value Microcap Fund
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| Fund Overview | The objective of the Fund is to identify undervalued Microcap companies, invest in them and, through a medium to long term commitment, attempt to deliver superior investment returns. The Fund invests primarily in ASX listed Microcap companies, which at the time of initial investment are generally below a market capitalisation of A$250 million. The Fund may also invest in companies with a higher market capitalisation, but these will be limited to no more than 20% of the assets of the Fund. At times the Fund may invest in pre-IPO securities that are due to be listed on the ASX within 3-6 months, and have lodged a prospectus with ASIC. These investments will also be limited to no more than 10% of the assets of the Fund. The Fund will be limited to investing no more than 20% of the Fund's assets in any one security or company. The Fund will make investments with a medium to long term time horizon of between 3-5+ years. The Fund will not speculate in derivatives. It will be permitted to hold other securities that are directly associated with a particular investment such as options granted with a specific company issue etc. The Fund will not engage in short selling or stock lending. The Fund will not hold financial debt of any kind. |
| Manager Comments | The has recorded very high Sharpe and Sortino ratios of 2.93 (Index 1.40) and 13.88 (Index 2.79) respectively. The Up and Down Capture ratios are 0.83 and -1.20 with the Fund recording up months in all 3 months the market was negative over the preceding 12 months to August. Whilst the peak of the capex cycle in the resource sector is a structural change in the economy, the slowdown in retail activity is but a temporary one. Household consumption is in fact facing the preconditions for almost booming conditions; household debt has been growing at a very slow 2% rate per annum since the GFC. However thanks to a booming property market and a stronger equity market driving growth in household assets, Australian households' net debt position has been solidified. |
| More Information | » View detailed profile of this fund |
8 Sep 2014 - Monash Absolute Investment Fund
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| Fund Overview | The fund seeks to identify opportunities in the share market to make positive returns (long and short) irrespective of market conditions. It is style agnostic, as compelling investment opportunities exist across all investment styles from time to time. The Fund places a high priority on capital preservation, and has an absolute return focus in accepting market risk. The Manager's experience across value, growth and discounted cash flow styles allows them to use a comprehensive approach to investment decisions that applies all three. They also have the patience to seek out only compelling opportunities, rather than settling for relative value. The portfolio is somewhat concentrated, looking to diversify across industries and themes, rather than by trying to stay near an index. The portfolio may at times have a large amount of cash or other protection. However once investments are made turnover may be relatively high in order to lock in gains and avoid losses. |
| Manager Comments | The Sharpe and Sortino ratio since inception is 2.00 and 7.37 over the last 12 months. Fund exposures were net 88% and gross 99% at month-end. The Fund returned 2.3% after fees. August is a reporting month for the Australian market, so it is always interesting. We had a good reporting season and suffered no negative surprises. The portfolio also benefited from exposure to a placement and two IPOs. |
| More Information | » View detailed profile of this fund |
8 Sep 2014 - ARRIA Round Table - Brisbane
AARIA ROUND TABLE 2014
Tuesday 9 September 2014 in Brisbane
We operate in the area of "real returns" and are eager to help our network of IFA's that operate outside the traditional static buy and hold methodology. This has led me to meeting the Association of Real Return Investment Advisers (ARRIA).
The Group has been established as a not-for-profit entity run by advisers for advisers. ARRIA is an initiative based on feedback and insights from advisers regarding the challenges that they face in using Real Return investment strategies, which they believe are able to deliver tangible solutions to meet their client's objectives.
ARRIA is hosting a round table discussion on Tuesday 9 September, from 12pm to 4.30pm, in Brisbane and offers a valuable opportunity to meet with likeminded advisers. The agenda for the round table is as follows:
Round Table 1: Agenda
- What are the implications of developing Real Return outcomes for PI and the regulators?
- Panel discussion - which alternative "strategies" work when?
- Panel discussion - what are the new investment opportunities, "access" methods (e.g. LICs), strategies, asset classes and investment flavours?
- Tool time
- Open Forum
Click here to register for the Round Table event, or if you would like more information please contact:
Philip Reid | General Manager
Association of Real Return Investment Advisers Limited (ARRIA)
ABN 82 99 168 267 623
GPO Box 5025, Sydney NSW 2001
T 0411-828 097 E [email protected]
The next Round Table event to be held in Brisbane will be on Tuesday 9 December 2014.
As an association ARRIA aims to:
- assist in setting and maintaining a higher level of professional standards for all Real Return Investment Advisers and all relevant Stakeholders in the real return investment industry.
- create an environment where all Real Return Investment Advisers and all relevant Stakeholders can network in appropriate forums to advance the exchange of information, best-practice and compliance issues;
- create an environment where all Real Return Investment Advisers and all relevant Stakeholders can leverage industry resources;
- assist with the gathering and dissemination of resources in order to help facilitate:
- the collation and provision of information of interest or relevance;
- the development and / or access of appropriate tools;
- access to and sourcing of relevant and appropriate expertise;
- liaise and co-ordinate communications with government, regulatory bodies, other relevant industry associations and general service providers in the real return investment industry;
- whether undertaken with or without other participants; to promote, organise, conduct and/or participate in meetings, lectures, seminars, study groups, conferences, education, training and counselling courses for the purposes of increasing and advancing the knowledge and understanding of all facets and issues affecting or related to Real Return Investment Advisers and all relevant Stakeholders in the real return investment industry;
The operations of ARRIA are overseen by a Board, under the direction of the associations' corporate constitution and guidance of the directors. Both Directors and the Board are elected by the members on a rotation policy.
