Grant Samuel Tribeca Aust Smaller Coms (ETL0052AU) Report & Performance

What is the Grant Samuel Tribeca Aust Smaller Coms fund?

The objective of the Tribeca Australian Smaller Companies Fund is to achieve positive returns in excess of the Fund’s benchmark before fees and expenses over the long term by investing in small capitalisation Australian companies which are predominantly outside the top 100 stocks as defined by market capitalization.

  • The fund seeks to benefit from information arbitrage, focusing on companies that are under researched by analysts and stockbrokers, which can offer greater opportunities.
  • Actively managed, long-only strategy.
  • Style-neutral exposure to Australian Small Caps.
  • Strong, disciplined, principled and fundamental approach.

Growth of $1000 Investment Over Time

Performance Report

Peer Comparison Report

Peer Comparison Report

Latest News & Updates For Grant Samuel Tribeca Aust Smaller Coms

Grant Samuel Tribeca Aust Smaller Coms Fund Commentary September 30, 2023

The small cap market continued to exhibit choppiness like the previous quarter, staying largely range-bound albeit with a notable negative skew. A sell-off in global bond markets was partly to blame for the pressure on risk assets, with focus shifting from the level of peak rates to how long central banks will hold rates at restrictive levels, with “higher for longer” increasingly viewed as the necessary scenario to tame price pressures that remain, thus far, above central bank targets. This drove long bond yields higher, while economic data over the quarter pointed to a deterioration in the growth outlook, with services activity starting to show signs of “catching down” to manufacturing. Overall, not a great environment for equities. Domestic reporting season refocused investors on micro factors, with positioning and expectations playing a reasonable factor in stock performance. Consumer facing sectors, after a soft lead in, proved on the whole no worse than expectations and rebounded. Names that did well include GUD holdings and PWR Holdings. Technology outperformed but this was less about AI, with stocks moving around on quality of results. Life360 beat expectations while others such as Iress (not held) faltered. Commodities moved around materially, driving lots of stock specific action, though overall the sector badly underperformed the index. Energy including oil and uranium were the bright spots, reflected in stocks rallies for Karoon Energy and Paladin Energy, while large falls in Lithium prices resulted in big battery metals falls such as Allkem and Syrah. While gold prices were relatively static, investors sought protection in the event of stagflation emerging and Ramelius Resources and Genesis Minerals proved popular. Fund managers remained out of favour given weak markets, while REITS suffered on higher rates and Healthcare lacked its usual defensiveness with biotech names unwinding recent gains.

Year to date, markets have rebounded from the drawdown to June 2022, as inflation started to moderate, and the brisk pace of monetary policy normalization was buffered by consumers accumulated excess savings and their relatively good balance sheets. Moderation in bond yields from their peak in October allowed for some mean reversion (higher) in growth names, though unprofitable business models didn’t participate. A burst of enthusiasm around AI in March kept the focus on a few highly valued tech names, supporting growth valuations, even as yields started to grind higher again. With yields pushing to cycle highs in recent months, value factors have again reasserted themselves. Energy commodities have been a bright spot for the year, with oil, uranium and coal all logging double digit advances playing well to our overweight position. Materials underperformed but it was mixed under the surface, with gold doing well as the US Dollar weakened while battery metals fell precipitously as investors fretted about future oversupply. M&A interest in developer Liontown (not held) saw it remain resilient and hurt performance, however, falls in other developers that weren’t as lucky cushioned the blow. Technology rebounded well, with Life360 continuing to scale and welcoming back investor interest and NextDC signed some large hyperscaler commitments. Underweights in REITs and Agriculture were helped by prevailing conditions in each market while stock selection in Discretionary enabled us to offset our underweight as stocks there rebounded.

Turning to outlook, and there are some similarities with the previous quarter. We remain positive on small caps given the relative performance gap with large over the past 18 months. Some of the headwinds to small cap performance are beginning or have abated – inflation is moderating (albeit slowly), the US Dollar has begun depreciating, border reopening and return of immigration boosting aggregate demand.


Product Snapshot

  • Product Overview
  • Performance Review
  • Peer Comparison
  • Product Details

Product Overview

Fund Name APIR Code
? A Product Code is unique a identifier code issued by a group or governing body, to reference products in a large group. For an example, APIR codes are commonly used for Funds and Ticker codes are commonly used for Securities such as ETFs and Stocks.
Asset Class
? An Asset Class breakdown provides the percentages of core asset classes found within a mutual fund, exchange-traded fund, or another portfolio. Asset classes (in microeconomics and beyond) generally refer to broad categories such as equities, fixed income, and commodities.
Asset Category
? An Asset Category is a grouping of investments that exhibit similar characteristics and are subject to the same laws and regulations. Asset categories (or a sub-asset class) are made up of instruments which often behave similarly to one another in the marketplace, looking down to the Asset Category level is important if looking to build a diversified portfolio.
Peer Benchmark Name
? A Peer Index (benchmark) refers to a peer group of investment managers who have the same investment style or category. It is used to compare the performance of one manager to their peer group, which makes it simpler for investors to choose between the vast number of investment managers.
Broad Market Index
? A Market Index (benchmark) refers to a hypothetical portfolio of investments that represents a segment, asset or category of an investable market. Market Indices are used to benchmark managers performance, to assist their style reliability and ability to provide excess returns.
? Funds/Assets under management (AUM) is the total market value of the investments that a person or entity manages on behalf of clients. Assets under management definitions and formulas vary by company.
Management Fee
? A management fee is a charge levied by an investment manager for managing an investment fund. The management fee is intended to compensate the managers for their time and expertise for selecting finanical products and managing the portfolio.
Performance Fee
? A performance fee is a payment made to an investment manager for generating positive returns. This is as opposed to a management fee, which is charged without regard to returns. A performance fee can be calculated many ways. Most common is as a percentage of investment profits, often both realized and unrealized. It is largely a feature of the hedge fund industry, where performance fees have made many hedge fund managers among the wealthiest people in the world.
? A spread can have several meanings in finance. Basically, however, they all refer to the difference between two prices, rates or yields. In one of the most common definitions, the spread is the gap between the bid and the ask prices of a security or asset, like a stock, bond or commodity. This is known as a bid-ask spread.
Grant Samuel Tribeca Aust Smaller ComsETL0052AUManaged FundsDomestic EquityAustralian Small CapDomestic Equity - Small Cap IndexASX Index Small Ordinaries Index50.88 M0.92%0.00%0.6%

Performance Review

Fund Name Last Month
? Returns after fees in the most recent (last) month).
3 Months Return
? Returns after fees in the most recent 3 months.
1 Year Return
? Trailing 12 month returns.
3 Years Average Return
? Average Annual returns from the last 3 years.
Since Inc. Average Return
? Average (annualised) returns since inception
1 Year Std. Dev. (Annual)
? The standard deviation (or annual volatility) of the last 12 months.
3 Years Std. Dev. (Annual)
? The average standard deviation (or annual volatility) from the last 3 years.
Since Inc. Std. Dev. (Annual)
? The average standard deviation (or annual volatility) since the fund inception.
1 Year Max Drawdown
? The maximum drawdown in the last 12 months - a drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.
3 Year Max Drawdown
? The maximum drawdown in the last 36 months - a drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.
Since Inc. Max Drawdown
? The maximum drawdown since inception - a drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.
Grant Samuel Tribeca Aust Smaller Coms7.22%8.25%13.61%5.58%8.13%12.58%16.85%16.96%-6.78%-25.76%-30.13%

Peer Comparison

Fund Name Peer Index Name
? A group of individuals who share similar characteristics and interests are called peer groups. Peer group analysis is an essential part of assessing a price for a particular stock in investment research. The emphasis here is on making a comparison, meaning that the peer group constituents should be more or less identical to the company being examined, especially in terms of their main business and market capitalization areas.
12 Months Excess Return
? Excess returns are an important metric that helps an investor to gauge performance in comparison to other investment alternatives. In general, all investors hope for positive excess return because it provides an investor with more money than they could have achieved by investing elsewhere.
Excess Return Annualised Since Inception
? Excess returns are an important metric that helps an investor to gauge performance in comparison to other investment alternatives. In general, all investors hope for positive excess return because it provides an investor with more money than they could have achieved by investing elsewhere.
12 Months Alpha
? Alpha is used in finance as a measure of performance, indicating when a strategy, trader, or portfolio manager has managed to beat the market return over 12 months. Alpha, often considered the active return on an investment, gauges the performance of an investment against a market index or benchmark that is considered to represent the market’s movement as a whole.
Alpha Annualised Since Inception
? Alpha is used in finance as a measure of performance, indicating when a strategy, trader, or portfolio manager has managed to beat the market annualized since inception. Alpha, often considered the active return on an investment, gauges the performance of an investment against a market index or benchmark that is considered to represent the market’s movement as a whole.
12 Months Beta
? Rolling 12Month Beta is a measure of the volatility—or systematic risk—of a security or portfolio compared to the market as a whole. Beta is used in the capital asset pricing model (CAPM), which describes the relationship between systematic risk and expected return for assets (usually stocks).
Beta Annualised Since Inception
? Beta is a measure of the volatility—or systematic risk—of a security or portfolio compared to the market as a whole. Beta is used in the capital asset pricing model (CAPM), which describes the relationship between systematic risk and expected return for assets (usually stocks).
12 Months Tracking Error
? 12Month Tracking error is the difference in actual performance between a position (usually an entire portfolio) and its corresponding benchmark over the last 12 months. The tracking error can be viewed as an indicator of how actively a fund is managed and its corresponding risk level. Evaluating a past tracking error of a portfolio manager may provide insight into the level of benchmark risk control the manager may demonstrate in the future.
Tracking Error Since Inception
? Since Inception tracking error is the difference in actual performance between a position (usually an entire portfolio) and its corresponding benchmark since inception. The tracking error can be viewed as an indicator of how actively a fund is managed and its corresponding risk level. Evaluating a past tracking error of a portfolio manager may provide insight into the level of benchmark risk control the manager may demonstrate in the future.
12 Months Correlation
? Correlation, in the finance and investment industries, is a statistic that measures the degree to which two securities move in relation to each other. Correlations are used in advanced portfolio management, computed as the correlation coefficient, which has a value that must fall between -1.0 and +1.0.
Correlation Since Inception
? Correlation, in the finance and investment industries, is a statistic that measures the degree to which two securities move in relation to each other. Correlations are used in advanced portfolio management, computed as the correlation coefficient, which has a value that must fall between -1.0 and +1.0.
Grant Samuel Tribeca Aust Smaller ComsDomestic Equity - Small Cap Index2.01%-0.53%0.19%-0.12%-0.12%0.962.8%4.82%0.980.97

Product Details

Fund Name Verifed by SMSF Mates Manager Address Phone Website Email
Grant Samuel Tribeca Aust Smaller ComsYes-

Product Due Diligence

What is Grant Samuel Tribeca Aust Smaller Coms

Grant Samuel Tribeca Aust Smaller Coms is an Managed Funds investment product that is benchmarked against ASX Index Small Ordinaries Index and sits inside the Domestic Equity - Small Cap 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 Grant Samuel Tribeca Aust Smaller Coms has Assets Under Management of 50.88 M with a management fee of 0.92%, a performance fee of 0.00% and a buy/sell spread fee of 0.6%.

How has the investment product performed recently?

The recent investment performance of the investment product shows that the Grant Samuel Tribeca Aust Smaller Coms has returned 7.22% in the last month. The previous three years have returned 5.58% annualised and 16.96% each year since inception, which is when the Grant Samuel Tribeca Aust Smaller Coms 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 Grant Samuel Tribeca Aust Smaller Coms first started, the Sharpe ratio is 0.42 with an annualised volatility of 16.96%. The maximum drawdown of the investment product in the last 12 months is -6.78% and -30.13% 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 Grant Samuel Tribeca Aust Smaller Coms has a 12-month excess return when compared to the Domestic Equity - Small Cap Index of 2.01% and -0.53% 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. Grant Samuel Tribeca Aust Smaller Coms has produced Alpha over the Domestic Equity - Small Cap Index of 0.19% in the last 12 months and -0.12% since inception.

What are similar investment products?

For a full list of investment products in the Domestic Equity - Small Cap Index category, you can click here for the Peer Investment Report.

What level of diversification will Grant Samuel Tribeca Aust Smaller Coms provide?

Grant Samuel Tribeca Aust Smaller Coms has a correlation coefficient of 0.97 and a beta of 0.96 when compared to the Domestic Equity - Small Cap 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 Grant Samuel Tribeca Aust Smaller Coms and its peer investments, you can click here for the Peer Investment Report.

How do I compare the Grant Samuel Tribeca Aust Smaller Coms with the ASX Index Small Ordinaries Index?

For a full quantitative report on Grant Samuel Tribeca Aust Smaller Coms compared to the ASX Index Small Ordinaries Index, you can click here.

Can I sort and compare the Grant Samuel Tribeca Aust Smaller Coms to do my own analysis?

To sort and compare the Grant Samuel Tribeca Aust Smaller Coms financial metrics, please refer to the table above.

Has the Grant Samuel Tribeca Aust Smaller Coms 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 Grant Samuel Tribeca Aust Smaller Coms?

If you or your self managed super fund would like to invest in the Grant Samuel Tribeca Aust Smaller Coms please contact via phone or via email .

How do I get in contact with the Grant Samuel Tribeca Aust Smaller Coms?

If you would like to get in contact with the Grant Samuel Tribeca Aust Smaller Coms manager, please call .

Comments from SMSF Mates

SMSF Mate does not receive commissions or kickbacks from the Grant Samuel Tribeca Aust Smaller Coms. All data and commentary for this fund is provided free of charge for our readers general information.

Historical Performance Commentary

Performance Commentary - August 31, 2023

Market volatility increased In August, reflecting renewed stress in the Chinese property market, a downgrade to the US governments credit rating and higher sovereign bond yields. Given this backdrop, global stocks sold off, with better-than-expected economic data considered bad news for inflation and rates. Markets recovered off their worst levels late in the month, in line with yields easing back US 10-year bonds added 13bps to 4.11 while domestic 10-year yields ended flat. Commodity markets were mixed, as the USD rallied back from its recent sell off. Battery metals, Gold and base metals pulled back, while oil continued to gain and iron ore defied the gloomy China macro-outlook. Domestically, reporting season did little to inspire markets with largely disappointing results and cautious outlooks leading to meaningful negative earnings adjustments. The S&P/ASX 200 Accumulation index fell 70bps, with discretionary and REITs propping up the index as results were less bad than feared. Staples and utilities dragged as defensives couldn’t live up to expectations. On the smaller side, the index underperformed the broader market by 60bps, as industrials, health and financials lagged. Energy, discretionary and telcos did the heavy lifting on the positive side. The Tribeca portfolio pleasingly delivered a positive absolute return in a down month for the index, with most sectors contributing positively to alpha.

Positively contributing to performance during the month included PWR Holdings (PWH +18.1%), which rebounded after the company managed to largely deliver on lofty expectations for second half earnings growth. The first half result in February has weighed the stock down after it revealed a meaningful skew to the June half earnings. However, the company executed well to deliver on forecasts in a year of elevated cost inflation, tight labour availability and meaningful reinvestment in capability. Life360 Inc (360 +20.7%) also rallied on their result, having delivered strong growth during a seasonally quite quarter. Net customer adds were a highlight, which was taken well considering recent prices increases. Management upgraded profit guidance for CY23, and we see room for this to be exceeded should the back to school (August) period in the US deliver another quarter of strong growth. FleetPartners Group (FPR +14.4%) had no news of note during the month, however it ground higher as the company continued to execute its capital management strategy via buying back shares on-market.

The FPR valuation remains un-demanding with catalysts including continued strong novated leasing growth, new customer wins in fleet and potential participation in well-flagged M&A activity. GUD Holdings (GUD +21.77%) delivered an inline result, however better progress on de-levering the balance sheet was all investors needed to drive a re-rating in the share price. Well publicised vehicle supply issues have hindered the performance of their APG acquisition from 2021, and as this ease, the company should demonstrate the earnings power of APG and possibly drive future earnings upgrades. Chalice Mining (CHN -39.6% not held) released the scoping study for their proposed Gonneville mine in Western Australia. Several facets appeared to underwhelm the market, notably lower forecast metallurgical recoveries, higher operating and capital costs. Given the mine won’t be in production until the end of the decade, these input changes dragged down the net present value of the mine materially.

Detracting from performance was Fletcher Building (FBU -14.3%), which saw downgrades to future earnings courtesy of higher interest costs than analysts expected. An issue in their pipe division also drew a lot of focus from the market, with management unable to be definitive at this stage as to the expected impact. Unfortunately, this masked the fact that costs have been well controlled in the recent downturn and the Australian division continues to improve. The stock should be well placed to benefit from any rebound in the New Zealand housing market, if only it can minimise the continual peripheral issues that catch undue amounts of the market’s attention. Imdex (IMD -17.4%) reported softer earnings than anticipated, as the mineral exploration market remained soft through the second half of FY23, particularly in key markets Australia and Canada. Continued investment in new technologies also contributed to the earnings miss, despite revenue being stronger than expectations. Looking forward, the September quarter last year will be a challenging comparator in FY24, however it gets easier to lap softer earnings from there. We also think contributions from new technologies in latter FY24 and FY25 are not reflected in earnings and pose upside risk to expectations. Webjet (WEB -11.4%) drifted lower through the month, then sold off on AGM slides highlighting a slowing in rates of growth, albeit from high levels. While crowded positioning likely contributed to the weakness, we welcome the washout in positioning and remain very positive on future earnings growth that has the potential to positively surprise the market. Premier Investments (PMV +16.1%) announced the departure of the relatively recently appointed CEO and a strategic review aimed at maximising value of the PMV portfolio.

Performance Commentary - July 31, 2023

Global equity markets rallied in July, as disinflationary forces gathered pace and inflation reports from developed economies surprised to the downside. Economic data was generally better than anticipated, particularly in the US. This has left developed market central banks to ponder just how much further they need to tighten policy in this environment, but recent more dovish commentary has boosted sentiment.

The environment wasn’t conducive for bonds as yields rallied, while new flexibility in the Bank of Japan’s yield curve control policy saw more material moves in the market. Economic data out of China has generally disappointed economist and investor expectations, but Chinese officials are beginning to act on stimulus measures, however there is little detail on the size of any packages. This kept iron ore prices in check (-2.2%), however, the weaker US Dollar helped boost other commodities (Copper +5%; Nickel +7%; Brent Crude +14%; Comex Gold +4%).

Domestic equity benchmarks rebounded almost 6% from intra-month lows, the S&P/ASX 200 Accumulation gaining 2.9%. Energy and Banks headlined gains, while Health and Staples struggled to keep up. Small Caps pulled back some recent underperformance (Small Ords Accumulation +3.5%), led by the Discretionary and Staple names, along with Energy. Healthcare lagged while oddly Materials was the only sector to finish lower as some of larger lithium names delivered mixed updates. Investors more hopeful of a softlanding supported cyclicals and value exposures overgrowth. The Tribeca portfolio managed small outperformance in what was a strong absolutereturning month, with no discernible trends of note.

Stocks on the positive side of the alpha ledger included Smart Group (SIQ +14.1%), a more recently promoted overweight in the portfolio. Our expectation was that SIQ’s leverage to changes to the Fringe Benefits Tax (FBT) policy in relation to Electric Vehicles (EV) was previously under appreciated by the market. SIQ is one of the largest novated leasing businesses in Australia, and inquiries regarding EVs have increased materially across the past 6 months. We are expecting a large lift in leases written and material upgrades to market’s future earnings expectations.

Core Lithium (CXO -29.9% Not Held), delivered a poor quarterly, with lower spodumene recoveries resulting in a material miss to production expectations. Guidance fared little better, materially below expectations in FY25, with additional capex required to attempt to fill the gaps. We have long had reservations around expectations for ramp up of the Finniss mine and continue to remain on the sidelines. Genesis Minerals (GMD +12.6%) sealed their acquisition of St Barbera’s (SBM) Leonora assets in July, with June quarterly production indicating potential upside to the base case estimates laid out in the initial business case 12 months ago. With intentions of 500koz per annum of gold production, this would place GMD in the globally significant mining hub bucket.

Further, GMD looks very cheap versus peers on a number of metrics, and we anticipate a material re-rating for the stock over time. GQG Partners (GQG +17.0%) continued to deliver steady monthly inflows into its global equity funds and July was no exception. Fund performance is sound and GQG stands out as one of the few listed-equities fund managers achieving inflows. Trading at a material discount to the small cap market (-40%) and a distribution yield of ~9% we feel there is room for GQG to re-rate, particularly if markets continue to appreciate. Lastly, Karoon Energy (KAR +13.2%) delivered a sound quarterly production report, with FY24 guidance inline to slightly better than expectations. Free cash flow generation should lift materially over the coming 12 months, creating optionality for M&A and/or capital management.

Performance Commentary - June 30, 2023

The Small Cap market rebounded at the start the final quarter of the fiscal year, after a brief liquidity crisis in US regional banks darkened the outlook for growth and resulted in drawdown in markets. Alas, the strong performance in April could not be maintained, and while inflation moderated, central banks deemed it not to be fast enough and continued to raise interest rates resulting in markets again moving to a more cautious stance. Themes evident in the March quarter continued, as growth concerns remained at the forefront of investors’ minds. As such, IT names exposed to a thematic or able to grow under their own steam did well despite the rebound higher on bond yields. NextDC’s announced a big step up in contracted utilisation, as hyperscale customers embarked on a land-grab ahead of the anticipated wave of AI-related data consumption. Life360 also outperformed expectations at their quarterly resulting in earnings expectations upgraded. Biotechnology names were also in demand again, which partly moderated our gains at the growthier end.

Select industrials Kelsian Group, Fletcher Building and Smart Group all gained on stock specific factors, while HMC Capital bucked the softer trend in REITs to outperform. Materials names dragged as China’s COVID rebound petered out, leaving investors eagerly anticipating additional stimulus measures to supplement growth. To date, additional measures have been modest. Meanwhile, Gold underperformed on a higher US Dollar and bond yields. Consumer demand saw the first signs of softening, Universal Stores, amongst others, called out a soft patch in youth apparel demand, as did OOH Media in media. Select auto names underperformed on earnings concerns, offsetting some of the benefits of our underweight in consumer retail.

After a tough FY22, investors welcomed the small cap market rebound from the market lows in FY23. Mean reversion was evident versus the previous 12 months, as growthier names re-emerged as market leaders, resuming trends witnessed over the past decade. A newfound focus on cashflow by boards and management teams has resonated with investors, particularly in tech, as did names exposed to emerging themes such as AI. Alternatively, those still burning cash or unable to show growth struggled to capture investor attention. Battery metals similarly saw a similar outcome, with investors more selective around which projects were likely to be viable and those with cashflows have proved more resilient in market selloffs. M&A interest in developer Liontown (not held) and Graphite market heartburn knocked around Syrah, which took some gloss off our sector performance. Gold drifted higher as inflation and the US Dollar peaked. Underweights across agriculture exposures positively contributed as tailwinds from recordbreaking weather conditions abated, similarly in passive REITs where anticipation of property cap rate expansion resulted in little demand for the equities. Our underweight in consumer discretionary weighed as consumer demand held up better than anticipated in the face of rising rates, while the couple of names we did hold performed poorly. Lastly, the healthcare underweights dragged given our lack of exposure to med and biotech names which did well.

Performance Commentary - May 31, 2023

Global equities were mixed through May, as concerns lingered around US lawmakers’ intentions on the country’s debt ceiling and the potential for further rate hikes from the U.S. Federal Reserve. Developed markets saw a divergence, as the narrow rally in mega cap technology related names helped keep the S&P 500 aloft and Japan’s TOPIX surged to a 33-year high. Meanwhile, Europe underperformed given their reliance on Chinese growth (which also weighed on emerging markets returns). The Government balance sheet remains robust, delivering a small surplus in an otherwise benign May budget. The S&P/ASX 200 Accumulation lost 2.5%, underperforming global markets, with IT and Utilities the only bright spots. Discretionary lagged as evidence of consumer demand weakening finally became evident. Small Ords fared slightly worse, falling 3.3% as IT names failed to rally as much as their larger peers and also as a larger proportional exposure to consumer discretionary names.

Commodities and precious metals were soft across the board in May (apart from a bounce in lithium), with the USD (DXY +2.7%) and global bond yield (US 10-year yield +20bps) rally weighing on the space. Factor-wise, growth was favoured over value, while sales and earnings revisions performed strongly. The Tribeca portfolio pulled back some relative performance from April, helped by good performance from industrial and IT names, together with our underweight in retail which was partially offset by a downgrade in the only name we hold.

Positively contributing to the portfolio in May was Kelsian Group (KLS +11.5%), with the market finally digesting their recent US acquisition and equity raise conducted in March. The company paid $487m for an established bus transportation business operating across the southern US states, providing it with a beach head into a new market with attractive growth attributes. We heavily bid into the associated capital raise at what we believe to be very attractive terms, with KLS providing relatively defensive growth attributes at a reasonable discount to the market. NextDC (NXT +11.7%) also raised equity during the month, to fund recently announced contract awards as well as regional expansion into Malaysia and New Zealand. Bullish AI commentary also provided a tailwind to exposed names, with NXT extremely well placed to take advantage of future growth in data consumption. HMC Capital (HMC 12.2%) launched an acquisition of the Healthscope Hospital assets in late June, increasing investor confidence of attaining their $10bn FUM target earlier than expected. It has been a rough 12 months in the property space however we feel HMC is best placed to successfully navigate the challenging environment successfully. Allkem (AKE +21.2%) announced their intention to merge with peer Livent (LTHM.NYS) in an all-scrip deal creating a group with a combined value of $15.7bn.

Synergistic benefits should be considerable, with both companies operating assets in Argentina and Canada, while the combination of up and downstream assets is very complimentary. We believe the corporate activity also puts AKE in play with assets that would be coveted by a number of other large industry participants. Lastly, MAAS Group Holdings (MGH +12.9%) performed well, despite releasing no new news during the month. Negative contributors to performance included Ooh Media (OML -25.8%), who presented at the annual Macquarie Conference and provided a trading update which saw a material slowdown in revenue post their February result commentary. 1Q23 revenue was +3% vs management’s expectations of +8%, while April was -10%. The out of home industry was +11.8% in 1Q23, meaning OML ceded substantial share in the street furniture category in the period. Management also called out gross margin pressure for 2023 due to the large number of contract renewals set to take place. Despite the company not considering the update material, we found it disappointing that tailwinds in previous periods weren’t called out at the time. Subsequently, our holding is being reviewed. Universal Stores (UNI -39.8%) announced a disappointing trading update, with sales and profit below expectations.

Whilst we have been concerned about the outlook for retail stocks generally, we thought that UNI would be relatively well protected, given a younger customer base with lower exposure to mortgage stress. This proved not to be the case, with rents, university debt and inflation all converging to place pressure on the wallet of UNI customers. We view UNI as a well-run business, with a compelling offer and improving market share. However, in the short term it is hostage to the difficult retail environment.

Syrah Resources (SYR -26.0%) continued to drop after its surprisingly weak quarterly and convertible note issue in late April. SYR’s strategic position is unquestionable, being the largest natural graphite producer of scale outside China. With the battery manufacturing market ex China still nascent, SYR is seeing challenges placing product into a softer Chinese EV market during the first quarter.

Performance Commentary - April 30, 2023

Equities rallied over April, as the stress in the U.S. banking system steered monetary policy outlook in a slightly less hawkish direction. Outside the U.S., core rates of inflation remain stubbornly high, and the global economy remains surprising resilient to tightening credit conditions.

Australian 10-year bond yields tracked sideways as the cash rate remained unchanged, while US yields fell slightly on expectations of a pause to the Feds aggressive rate hike path. The local market outperformed the MSCI Developed Markets World, with the S&P/ASX 200 rising 1.9% over April, on the back of stronger consumer sentiment and stabilising interest rates.

Small caps outperformed, adding 2.8% in a broad-based rally, paced by health care and financials. Factor dispersion was low in April, highlighting the lack or search for leadership. Given continuing shift in macro signals, it’s expected that mixed factors signals and themes continues. The Tribeca portfolio lagged the benchmark for the month, as we saw some mean reversion in key overweight names and strong outperformance in larger index weights that we didn’t hold.

Negatively contributing during the month was Syrah Resources (SYR -37.1%), which was affected by broader negative sentiment in the EV space and a deterioration in the outlook for battery material inputs to China as a consequence of excess inventory build. SYR had been materially affected by this sudden change and took steps to mitigate this impact, such as cutting production and seeking convertible funding from a large Australian institution. With the battery market outside of China still relatively nascent, a key end market for SYR future production, we endeavour to gain a better understanding of supply/demand dynamics inside China and the near-term outlook for SYR sales. Champion Iron (CIA -9.4%) released their quarterly production update, which was largely inline with expectations, and an improvement from Q2, which was impacted by the late delivery of key equipment. A more material driver of performance was Iron Ore prices, which retreated (Iron Ore -17.3%) on continued concern around China’s economic recovery. While our base thesis regarding the stock surrounds the underappreciated increase in future demand for green steel, we see the current China recovery as broadly supportive of iron ore prices. Telix Pharmaceuticals (TLX +47.1% – Not Held), was boosted by a strong quarterly result, with sales of their PSMA imaging drug ahead of market expectations.

The stronger ILLUCCIX sales, together with an expansion in the Total Addressable Market and TLX’s second consecutive quarter of positive cash flows, drove double digit upgrades to consensus’ near term and mediumterm forecasts. Capricorn Metals (CMM -6.9%) released, during April, its favourable preliminary feasibility study for its newest project, Mt Gibson. Pleasingly, initial details were slightly ahead of market expectations. March quarter production numbers were also in-line with expectations, while gold sales beat estimates. The market sold the good news. Lastly, Imdex (IMD -7.6%) shares slipped on no news, however offshore-listed drilling names continued to report solid demand despite some softness in Australia and Canada. Junior mining capital raisings were down month on month, however with gold prices around all time highs, future activity looks well supported.

Positively contributing to performance included Genesis Minerals (GMD +22.1%), after they favourably renegotiated their deal with St Barbera (SBM). GMD conducted a capital raise to acquire the Gwalia mine from SBM as part of a strategy to consolidate the area around their GMD processing mill. Should the acquisition be approved, we believe GMD looks very cheap versus peers. NextDC (NXT +9.8%), which outperformed on the announcement of a significant new contract, was also a positive contributor. The contract, believed to be with Microsoft, is comfortably the largest ever signed in NXT’s history and will fill around 50% of the total capacity in the recently constructed S3 Data Centre. As well as providing a strong boost to earnings over the next few years, such a significant contract also helps reassure the market around the demand outlook for the rest of NXT’s available capacity and is not fully factored into the share price in our view. Perseus Mining (PRU -6.3% – not held) was affected by escalating violence and coup in Sudan, which is the location of their newest project, the Meyas Sand Gold Project. Thankfully, no staff were impacted.

Performance Commentary - March 31, 2023

The March quarter in small caps was highlighted by volatility, with the index trading in a 356 point or 13 per cent range. It was action packed, highlighted by a vicious mean-reversion rally in January, the usual individual stock volatility associated with reporting season in February, followed by a mini collapse on the back of US regional bank runs which culminated in US authorities stepping in to guarantee deposits and bank liquidity and the market recouping its losses in March. As a result, investors pivoted back to growth as recession concerns became more heightened and the markets earnings growth forecasts were downgraded. Growth exposures in technology such as NextDC and Technology One aided the portfolio, along with some still over-inflated names we didn’t hold. Frustratingly, this was offset by an underweight in healthcare, where biotech and MedTech names performed well. Retailers (underweight) and the consumer appeared largely immune from the recent tightening in financial conditions, with trading still reported as buoyant across most sectors ex the early cycle areas of furniture and housing. Financials (overweight) didn’t escape so easily, and were marked down heavily in the March, with several portfolio names yet to rebound. Gold benefitted from the uncertainty, with our existing and recently added names performing well, as did base metals on the lower USD. Meanwhile, M&A returned with several stocks receiving healthy bids from PE/offshore players. Unfortunately, this benefitted none of the portfolio names, and the material premium for large pre-production lithium miner Liontown proved quite costly to performance late in the quarter.

On an annual basis, the small cap market declined however our strong performance in materials headlined portfolio returns. Battery metals headlined with a relative overweight for over half the period before moving underweight as the market got a little euphoric. Base metals and ferrous both contributed healthy gains aided by excellent stock picking, as did Gold, as we closed up our underweight positioning. Financials provided opportunities for alpha despite a particularly poor performance from the sector, as overweights in insurance brokers and underweights in market linked names proved fruitful. Meanwhile, capital goods exposures countered some of the portfolio alpha in materials, with mining services names we didn’t hold rallying as second derivatives of the miners. Retailing also dragged on the portfolio in consumer discretionary, with some missteps at City Chic proving particularly costly while most other retailers rebounded strongly. This was partially offset by auto exposures where overweights performed well.

Performance Commentary - February 28, 2023

Following a positive start to CY23, the equity market retraced some of January’s gains to close lower in February with company results illustrating waning earnings momentum. At the same time macro and geopolitical headwinds have not abated and central banks continue to grapple with the direction of monetary policy. Suddenly more hawkish, the RBA lifted rates 25bps, putting upward pressure on 10-year yields (+30bps to 3.86%) and further tightening conditions in an economy showing signs of deceleration.

US yields also rose considerately, up 39bps to 3.92%, in reaction to stronger than expected economic data and subsequently hawkish comments from Central Bankers. Commodity prices fell across the board, probably aligned to the US Dollar Index rebounding from 4 straight months of losses (DXY +3.0%). Brent Crude (-0.7%), Iron Ore (-2.3%), Base Metals (-9.7%) and Gold (-5.6%) all recorded declines, while the Aussie Dollar also fell back (-4.7%) after touching almost 72 US cents.

The domestic market wasn’t immune to the pressure with the broad S&P/ASX 200 Accumulation losing 2.5% while small caps performed marginally worse (-3.7%). Banks gave up last month’s big gains, and resources, energy and healthcare led declines in small caps. Info Tech, Industrials and Discretionary (mainly services) proved more resilient, however still closed lower for the month. Reporting season has all but concluded and overall saw company results meeting rather than exceeding or missing consensus expectations. The magnitude of price reactions for a miss in expectations, tended to be more extreme than historical experience, and those disappointing in outlook commentary saw added downside pressure. The Tribeca portfolio finished ahead of benchmark during the month, with a few favoured names delivering good results partially offset by the mini drawdown in Resources names we held.

Positive contributors to the portfolio included AUB Group (AUB +17.4%), which delivered their result in-line with the AGM update from November. The company pointed to a strong outlook and upgraded FY23 expected earnings, driven by benefits of continued premium rate increases, earlier synergies and strong performance from their UK acquisition, Tysers. AUB remains well placed to continue to deliver earnings growth with the recent re-rate emanating from very depressed share price levels as a result of the markets apathy towards the Tysers acquisition.

GUD Holding’s (GUD +23.3%) 1H23 result did enough to satisfy the market that the recovery of their Auto after-market business was on track and as such rebounded from price levels that imputed much lower earnings multiples than previous history. The APG division, which supplies towing and suspension parts to auto OEMs and aftermarket, saw improvement alongside the rebound in new car supply. This gave investors confidence supply chain challenges had impaired profitability since acquisition. GUD remains very cheap and we see material upside should new car supply continue to recover.

Ooh!Media (OML +10.8%) continued to see recovery in client allocation to outdoor advertising, with allocations so far in CY23 ahead of last year. Looking ahead, the industry is targeting continued share gains based upon greater transparency of performance and deeper integration with customers, which we believe can deliver growth outside of the cyclicality of advertising spend over time. Kelsian Group (KLS +12.5%) saw a strong rebound in their Marine & Tourism business, the first full unaffected period there since COVID began. The bus segments continue to see challenges around driver availability which are impacting margins, however this is being worked through and unlikely to have any lasting impact beyond this half. Meanwhile, numerous tender opportunities exist in Marine and Bus with KLS well placed to participate. The stock remains attractively priced against their forward growth profile, and in what has historically been relatively stable business sectors. Lastly, Eclipx Group (ECX 7.4%) released no news of note however pleasingly recouped some if it’s recent share price weakness.

Detractors during the month included PWR Holdings (PWH -17.8%), which failed to deliver enough for investors after a strong share price run in recent months. Of note, earnings were impacted by investment in growth, muting any benefits from top their line growth of ~15% to the bottom line. The result is a more typical skew to 2nd half earnings (i.e. larger), which unnerved investors. These skews are not unusual for PWH, with margins typically much stronger in 2H vs 1H given the Formula 1 racing schedule (a key revenue contributor to PWH). We forecast a similar outcome this year, and with several large contract opportunities on the horizon, we believe the FY23 investment and expansion in headcount and facilities to be leverageable into strong earnings growth moving forward. The rest of the main detractors for the month were Resources names, with Capricorn Metals (CMM -16.3%) and Silver Lake Resources (SLR -22.7%) part of the gold equity names that were sold off heavily on softer gold prices. We have recently added to our exposures there. Paladin Energy (PDN -18.2%) and Syrah Resources (SYR -14.3%) also sold off despite their commodities remaining relatively stable, evidence that risk off was pervasive across the sector in February.

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