The Monash Absolute Investment Fund ARSN 606 855 501 (Fund) seeks to implement the investment strategy by investing in a diversified portfolio of predominantly Australian equities (long and short), with overseas assets expected to average no more than 5% over time.
The investment strategy is Benchmark Unaware and there is no predetermined asset allocation; rather, the Fund only invests when suitable opportunities are identified. As such, asset exposures may vary significantly over time and without notice.
The Fund seeks to only invest in compelling opportunities. To identify these investment ideas, Monash Investors primarily employs fundamental, bottom-up company research and the judgement of its experienced portfolio managers.
Monthly Performance Report: July 2020
For the month of July the portfolio was up 3.48% (after fees). This compares to the S&P/ASX200, which was up 0.50%, and the Small Ords, up 1.39 %.
The portfolio continues to do well relative to the markets for the calendar year to date. While the portfolio is down -0.01% (after fees), the S&P/ASX200 is down -9.97% and the Small Ords is down -7.94%.
The markets have continued to hold up quite well, despite the ongoing business impacts of COVID. However, within that there are definitely stocks that are COVID “winners” and others that are COVID “losers”.
It is easy to pick this theme with hindsight. The challenge of course is to do identify it in advance of it occurring (or at least early enough after it starts) in an environment of uncertainty as to how COVID will play out, and one where stock prices have already reacted substantially.
Monthly Portfolio Metrics
|Outlook Stocks (Long)||20 Position: 83%|
|Outlook Stocks (Short)||1 Positions: -5%|
|Event, Pair and Group (Long)||3 Positions: 12%|
|Event, Pair and Group (Short)||1 Positions: -2%|
Return Summary Since Inception1(after all fees)
|Since Inception (p.a.)||9.20%|
1Inception date of Fund is 2 July 2012.
Portfolio Analytics Since Inception
|Standard Deviation (p.a.)||15.65%|
|Avg Gross Exposure||90.20%|
|Avg Net Exposure||78.50%|
Following the escalation of restrictions in Victoria, there will be a further dampening effect on business and a continuing impact on consumer behaviour. Not just in Victoria but also across the country, and the light at the end of the tunnel for COVID losers is being pushed back. For some, that will be only a short-term impediment, but for others there will be lasting impacts, due to the need for additional debt and/or equity.
One area where we think there will be a permanent change is in the marginal propensity of businesses to conduct overseas travel. Given the widespread recent acceptance and “normalisation” of video conferencing, the bar will be higher for employees to justify travel. As a result we think that earnings expectations for Corporate Travel (ASX: CTD) are too high, and we are short the stock.
On the other hand, COVID winners like Kogan (ASX: KGN) that are already benefiting from changing consumer behaviour towards purchasing goods online, are seeing the trend accelerating, and we have re-initiated a long position in Kogan.
Key Fund Information
|Management Fee||1.5375% p.a.|
|Performance Fee||20.5% above the RBA Cash Rate with High Water Mark|
|Morningstar Category||Alternatives Strategies|
For all business development enquiries, please contact
QLD, SA,WA,NT: Andrew Fairweather
Winston Capital partners (Acting on behalf of Monash Investors)
P. +61 401 716 043
NSW, ACT, VIC, TAS: Stephen Robertson
Winston Capital partners (Acting on behalf of Monash Investors)
P. +61 418 387 427
For all investor enquiries, please contact
Link Fund Solutions Pty Ltd (Acting on behalf of the Fund)
P. +61 2 9547 4311
Monash Absolute Investment Fund Unitholder Services, GPO Box 5482, Sydney NSW 2001
For all other enquiries
Invest with us
We would welcome you as a co-investor in the Fund.
This document is issued by Monash Investors Pty Limited ABN 67 153 180 333, AFSL 417 201 (“Monash Investors”) as authorised representatives of Winston Capital Partners Pty Ltd ABN 29 159 382 813, AFSL 469 556 (“Winston Capital”) for the provision of general financial product advice in relation to the Monash Absolute Investment Fund ARSN 606 855 501 (“Fund”). Monash Investors is the investment manager of the Fund. The Trust Company (RE Services) Limited ABN 45 003 278 831, AFSL 235 150 (“Perpetual”) is responsible entity of, and issuer of units in, the Fund. The inception date of the Fund is 2nd July 2012.
The information provided in this document is general information only and does not constitute investment or other advice. The content of this document does not constitute an offer or solicitation to subscribe for units in the Fund or an offer to buy or sell any financial product. Accordingly, reliance should not be placed on this document as the basis for making an investment, financial or other decision. This information does not take into account your investment objectives, particular needs or financial situation. Monash Investors, Winston Capital and Perpetual do not accept liability for any inaccurate, incomplete or omitted information of any kind or any losses caused by using this information. Any investment decision in connection with the Fund should only be made based on the information contained in the disclosure document for the Fund. A product disclosure statement (“PDS”) issued by Perpetual dated 12 September 2017 is available for the Fund. You should obtain and consider the PDS for the Fund before deciding whether to acquire, or continue to hold, an interest in the Fund. Initial Applications for units in the Fund can only be made pursuant to the application form attached to the PDS.
Performance figures assume reinvestment of income. Past performance is not a reliable indicator of future performance. Comparisons are provided for information purposes only and are not a direct comparison against benchmarks or indices that have the same characteristics as the Fund.
Monash Investors, Winston Capital and Perpetual do not guarantee repayment of capital or any particular rate of return from the Fund and do not give any representation or warranty as to the reliability, completeness or accuracy of the information contained in this document. All opinions and estimates included in this document constitute judgments of Monash Investors as at the date of this document are subject to change without notice. Perpetual is not responsible for this document.