Cooper Investors Global Equities Fund’s objective is to outperform the benchmark over the long term. The Fund will be constructed with limited reference to the benchmark, and therefore the fund’s returns may vary significantly from the Benchmark’s return.
While the concept of ‘AI’ has been of growing interest in technology circles for several years it blossomed into the dominant ‘new Paradigm’ for equity markets this quarter after bullish outlook statements from several large industry players.
Financial news, social feeds and broker commentary are now awash with ways to play this theme, suddenly every company claims AI is part of their strategy no matter which sector they’re in. All seem agreed that we have crossed the Rubicon and that AI will change the world from here on.
“We implement an overweight to AI as a mega force.” Blackrock, June ‘23
What is Cooper Investors Global Eqs Fd (Hdg) Cooper Investors Global Eqs Fd (Hdg) is an Managed Funds investment product that is benchmarked against Developed -World Index and sits inside the Foreign Equity - Currency Hedged Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Cooper Investors Global Eqs Fd (Hdg) has Assets Under Management of 72.21 M with a management fee of 1.2%, a performance fee of 0.00% and a buy/sell spread fee of 0.2%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the Cooper Investors Global Eqs Fd (Hdg) has returned 8.8% in the last month. The previous three years have returned 2.24% annualised and 14.02% each year since inception, which is when the Cooper Investors Global Eqs Fd (Hdg) first started.
How is risk measured in this investment product?
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Cooper Investors Global Eqs Fd (Hdg) first started, the Sharpe ratio is 0.5 with an annualised volatility of 14.02%. The maximum drawdown of the investment product in the last 12 months is -9.89% and -45.76% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
What is the relative performance of the investment product?
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Cooper Investors Global Eqs Fd (Hdg) has a 12-month excess return when compared to the Foreign Equity - Currency Hedged Index of 0.04% and 0.85% since inception.
Does the investment product produce Alpha over its Peers?
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Cooper Investors Global Eqs Fd (Hdg) has produced Alpha over the Foreign Equity - Currency Hedged Index of -0.05% in the last 12 months and 0.12% since inception.
What are similar investment products?
For a full list of investment products in the Foreign Equity - Currency Hedged Index category, you can click here for the Peer Investment Report.
What level of diversification will Cooper Investors Global Eqs Fd (Hdg) provide?
Cooper Investors Global Eqs Fd (Hdg) has a correlation coefficient of 0.92 and a beta of 1.15 when compared to the Foreign Equity - Currency Hedged Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
How do I compare the investment product with its peers?
For a full quantitative report on Cooper Investors Global Eqs Fd (Hdg) and its peer investments, you can click here for the Peer Investment Report.
How do I compare the Cooper Investors Global Eqs Fd (Hdg) with the Developed -World Index?
For a full quantitative report on Cooper Investors Global Eqs Fd (Hdg) compared to the Developed -World Index, you can click here.
Can I sort and compare the Cooper Investors Global Eqs Fd (Hdg) to do my own analysis?
To sort and compare the Cooper Investors Global Eqs Fd (Hdg) financial metrics, please refer to the table above.
Has the Cooper Investors Global Eqs Fd (Hdg) been independently verified by SMSF Mate?
This investment product is in the process of being independently verified by SMSF Mate. Once we have verified the investment product, you will be able to find more information here.
How can I invest in Cooper Investors Global Eqs Fd (Hdg)?
How do I get in contact with the Cooper Investors Global Eqs Fd (Hdg)?
Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the Cooper Investors Global Eqs Fd (Hdg). All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - March 31, 2023 The portfolio returned 7.28% in the quarter, versus the benchmark return of 6.60%.
The biggest contributors to portfolio return were Salesforce (profit margin expansion from cost efficiency efforts rapidly showing in numbers), Booking Holdings (strong Q4 results with gross bookings +58% year on year) and Rentokil Initial (uplift in organic growth guidance and Terminix synergies).
The biggest detractors to return were Frontier Communications (sold off on broker downgrade two days before month end), Eurofins Scientific (lag between higher costs and pricing to impact FY23 margins) and Danaher (market concern over a rumoured acquisition).
This quarter proved once again that equity markets can climb a ‘wall of worry’, rallying despite universally awful headlines. 2023 has so far seen the 2nd and 3rd biggest US bank failures in history, the hastily arranged rescue of Credit Suisse by UBS, ongoing interest rate hikes from central banks, nuclear rhetoric from Russia in Ukraine and the first indictment of a US President on criminal charges. Yet the overall index had a fine start to the year.
In truth market breadth was extremely narrow, reminiscent of 2020/21 where the market was propped up by NASDAQ. The outperformance of US tech in 2023 versus medium and smaller businesses is stark, March saw the second widest spread in the past 20 years with NASDAQ +7% versus Russell 2000 -5%.
Given the portfolio’s underweight to mega-cap tech and overweight in medium and smaller-sized businesses, we would typically expect the portfolio to lag this type of market move. As an indication, the top 10 index weights accounted for 4.2% of the benchmark’s 8.6% gain. In other words, the top 15% delivered almost 50% of the return.
Performance Commentary - January 31, 2023 The Fund will invest in global equities where we identify a compelling value proposition through the application of our VoF investment process. We focus on stocks with management that display proprietorial behaviours such as family and founder-linked companies, owner-operator business models or focused teams charged with driving change. The Fund may differ significantly from the benchmark, will generally hold 30-50 stocks and be fully invested. The Fund may invest in stocks of any size however investments will typically be in medium or larger-sized companies (US$5-75bn market capitalisation).
Performance Commentary - December 31, 2022 The portfolio returned 6.24% in the quarter, versus the benchmark return of 7.08%.
The biggest contributors to portfolio return for the quarter were Ferguson (completed re-list from UK to US market with possible inclusion to S&P 500 in 2023), APi Group (revised margin targets for Chubb at IR Day indicate material upside) and Vantage Towers (takeover offer came in at €32 a share – see Stock News section).
The biggest detractors to return for the quarter were Brookfield (volatile moves around December spin-off event), Salesforce (two senior executives announced exit in Q3 results) and London Stock Exchange Group (underperformed after a broker downgrade).
As the below chart from the FT shows, 2022 was a very challenging year for investors and unique in that the large draw-down in equities was matched by an equally awful year for the bond market. Other than holding US Dollar cash or Energy stocks, there were few places to hide.
Performance Commentary - September 30, 2022 The portfolio returned -4.77% in the quarter, versus the benchmark return of -5.52%. Profound US Dollar strength was a feature of the period; the A$ fell -6.5%, Yen -6.1%, Euro -6.3% and the Pound – 8.1%.
The biggest contributors to portfolio return for the quarter were HOYA (ongoing strong trends in EUV mask-blank business along with increased buyback), Workday (solid results, confident guidance and reducing share-based comp) and Arthur J Gallagher (“hard” insurance market characterised by increasing premiums continues to be supportive for insurance brokers).
The biggest detractors to return for the quarter were Comcast (flat growth in broadband subscribers in Q2), Eurofins Scientific (Q2 organic growth came in a touch light) and Sony (soft gaming trends in June quarter with quiet game launch slate).
The ‘bear rally’ of July faded as the quarter progressed with equities falling sharply in September and volatility continuing to rage in currency and bond markets. Sentiment around stocks is now of pervading bearishness. The market feeling is that we’re only sort of half way through this bear market, with the sell-off thus far reflecting evaporation of frothy market multiples pumped up by loose monetary policy and pandemic stimulus – the ‘P’ in the P/E ratio coming down. While the market is not exactly cheap, at 17x trailing earnings the S&P at least has returned back to around its 20-year average.
Performance Commentary - June 30, 2022 To say the last 12 months has been a game of two halves is understatement bordering on farcical. For the 6 months to 31 December 2021 the portfolio gained 11.7% versus the Benchmark which rose 6.2%. In the 6 months to 30 June 2022 the portfolio declined 25.6%, versus the Benchmark which fell 18.7%.
Positive contributors to return for the quarter were Yum China (relief as Shanghai lockdowns eased), Arthur J Gallagher (ongoing strong operating trends for insurance brokers) and Ferrovial (traffic beating forecasts in tollroad and airport assets).
The larger detractors to return for the quarter included Workday (phasing of some growth pushed into H2), Techtronic (market implying sharp deceleration expected in power tools) and ICE (has de-rated around 25% since the Black Knight deal announced in March). Over the last decade the CI Global team has undertaken extensive global travel hunting for Value Latency and building a unique relationship network and Watchlist of opportunities. We stand behind a track record of careful stewardship of investor capital, outperforming 9 of 11 years from 2011 to 2021 and typically outperforming 70-80% of down months.
In that light the performance of the fund in this year’s sell-off has been somewhat disappointing. We do not get everything right – we may misjudge a management team, misinterpret an industry trend change or be too early or late in a decision.
Performance Commentary - March 31, 2022 After a year of strong and steady asset prices 2022 has begun with an ice bucket over the head for equities investors. The Benchmark fell 5.09% for the quarter which, while on the surface appears an average sized correction in the context of history actually conceals severe volatility beneath the service. The reality is many parts of the market have seen material value destruction over the last few months.
During the quarter the Fund established a position in Cintas Corporation, a market leader in uniform rental services across North America (Mcap $44bn). This service provides workwear for large corporate and government clients, for example managing supply and laundry of uniforms for the nationwide employee base of customers such as Home Depot. Uniform rental is a tough local business (Cintas has a million customers) but management have built a high quality business operating with stable and growing recurring revenues and have consistently delivered for shareholders. They have the scale and a superior service offering which drives a unique and attractive return profile, including mid-to-high single digit sales growth, 40% returns on tangible funds employed, and earnings per share that have risen for an impressive 50 of the last 52 years.
Performance Commentary - June 30, 2021 After a wild 18 months the June quarter saw relative calm return to financial markets, with levels of volatility returning to pre-COVID19 levels. Equities markets remain in their bull trend with June seeing fresh all-time highs recorded across US and European indices, while Asia including Japan had a more flat quarter. The ‘inflationary boom’ price action that drove markets from November to March, characterised by sharply rising bond yields and an equities rotation from ‘Growth and Quality’ towards ‘Value and Cyclical’ appears to have stalled with Growth and Stalwart-type businesses outperforming once again this quarter. For the 3 months and 12 months to June 30th the Fund returned 7.97% and 32.87% respectively. This compares to the benchmark which returned 7.05% and 35.32%.
Significant contributors to return for the quarter were Intuit (continued strong operating trends in the Quickbooks Online business), Danaher (strong trends in life sciences markets plus M&A – see Stock News) and IQVIA Holdings (continuing strong results).
Product Snapshot
Product Overview
Performance Review
Peer Comparison
Product Details