OnePath Wholesale Emerging Companies Trust aims to achieve returns (before fees, charges and taxes) that exceed the S&P/ASX Small Ordinaries Accumulation Index, over periods of five years.
The global economy expanded in the second quarter despite weakness in manufacturing. The regional banking mini crisis in the U.S. flared up again early in the second quarter with the failure of another bank but then calmed. The U.S. and European economies have shown surprising resilience, helped by strong labor markets. China’s economic recovery continued during the period, although it was uneven and did lose some momentum. The reopening has largely benefited the services component of the economy, while slowing growth momentum globally has meant weaker-than-hoped manufacturing activity. Inflation generally eased in developed economies, largely driven by moderation in the goods component of inflation.
However, core inflation remained more stubborn. This caused developed central banks to continue tightening. The Bank of Canada resumed its tightening after a pause that started in January; the Reserve Bank of Australia also resumed rate hikes after a brief pause. Despite hotter inflation in Japan, the Bank of Japan maintained its accommodative monetary policy. The People’s Bank of China (PBoC) moved to become even more accommodative late in the second quarter.
What is OnePath WS-Emerging Companies OnePath WS-Emerging Companies 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 OnePath WS-Emerging Companies has Assets Under Management of 42.54 M with a management fee of 0.95%, a performance fee of 0.00% and a buy/sell spread fee of 0.38%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the OnePath WS-Emerging Companies has returned 6.56% in the last month. The previous three years have returned -0.26% annualised and 15.88% each year since inception, which is when the OnePath WS-Emerging Companies 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 OnePath WS-Emerging Companies first started, the Sharpe ratio is 0.35 with an annualised volatility of 15.88%. The maximum drawdown of the investment product in the last 12 months is -7.43% and -50.2% 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 OnePath WS-Emerging Companies has a 12-month excess return when compared to the Domestic Equity - Small Cap Index of -0.71% and -2.16% 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. OnePath WS-Emerging Companies has produced Alpha over the Domestic Equity - Small Cap Index of -0.07% in the last 12 months and -0.17% 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 OnePath WS-Emerging Companies provide?
OnePath WS-Emerging Companies has a correlation coefficient of 0.94 and a beta of 1.02 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 OnePath WS-Emerging Companies and its peer investments, you can click here for the Peer Investment Report.
How do I compare the OnePath WS-Emerging Companies with the ASX Index Small Ordinaries Index?
For a full quantitative report on OnePath WS-Emerging Companies compared to the ASX Index Small Ordinaries Index, you can click here.
Can I sort and compare the OnePath WS-Emerging Companies to do my own analysis?
To sort and compare the OnePath WS-Emerging Companies financial metrics, please refer to the table above.
Has the OnePath WS-Emerging Companies 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 OnePath WS-Emerging Companies?
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Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the OnePath WS-Emerging Companies. All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - May 31, 2023 The first quarter of 2023 saw the reacceleration of the global economy. Despite some headwinds created by aggressive monetary policy tightening in 2022, the first months of the year were characterized by a relatively strong global economy. The situation was helped by a low unemployment rate in Western developed countries, a robust rebound for the Chinese economy thanks to its reopening and a mild winter in Europe, all of which led to lower energy prices. China’s economy benefited from a strong post-COVID reopening as well as improved pricing and investment in the property sector. Europe saw better-thanexpected economic strength, helped by lower energy prices. Developed central banks continued to hike rates during the quarter. However, major central banks became less aggressive, downsizing the level of their rate hikes as they neared the end of their respective tightening cycles. One major central bank, the Bank of Canada, decided to enact a conditional pause of its tightening cycle. Inflation generally moderated, largely driven by some balance in the goods component of inflation. However, services ex-housing inflation is a significant concern for the U.S. Federal Reserve, especially given that the labormarket remains tight. The last month of the quarter saw problems erupt in the banking sector, which came under pressure as a result of aggressive monetary policy tightening. However, the issues did not appear to be systemic, and a rapid response from policymakers helped to calm markets.
Performance Commentary - April 30, 2023 The first quarter of 2023 saw the reacceleration of the global economy. Despite some headwinds created by aggressive monetary policy tightening in 2022, the first months of the year were characterized by a relatively strong global economy. The situation was helped by a low unemployment rate in Western developed countries, a robust rebound for the Chinese economy thanks to its reopening and a mild winter in Europe, all of which led to lower energy prices. China’s economy benefited from a strong post-COVID reopening as well as improved pricing and investment in the property sector. Europe saw better-thanexpected economic strength, helped by lower energy prices. Developed central banks continued to hike rates during the quarter. However, major central banks became less aggressive, downsizing the level of their rate hikes as they neared the end of their respective tightening cycles. One major central bank, the Bank of Canada, decided to enact a conditional pause of its tightening cycle.
Inflation generally moderated, largely driven by some balance in the goods component of inflation. However, services ex-housing inflation is a significant concern for the U.S. Federal Reserve, especially given that the labormarket remains tight. The last month of the quarter saw problems erupt in the banking sector, which came under pressure as a result of aggressive monetary policy tightening. However, the issues did not appear to be systemic, and a rapid response from policymakers helped to calm markets.
Performance Commentary - February 28, 2023 During the September quarter, Karara was replaced by Acadian as the manager of the portfolio. Acadian generated very strong performance over the quarter from stock and industry sector selection relative to the S&P/ASX Small Ords index. Good stock selection in Banks, Consumer Discretionary, Energy, Industrials, IT, Metals and Mining, while a large overweight in the Energy secotor was the main contributor to sector outperformance. Stock selection in Gold dectracted performance. Some of the larger stock contributors included oveweigths in New Hope and NIB and underweight Brainchip, Magelln and Megaport.
Performance Commentary - December 31, 2022 During the September quarter, Karara was replaced by Acadian as the manager of the portfolio. Acadian generated very strong performance over the quarter from stock and industry sector selection relative to the S&P/ASX Small Ords index. Good stock selection in Banks, Consumer Discretionary, Energy, Industrials, IT, Metals and Mining, while a large overweight in the Energy secotor was the main contributor to sector outperformance. Stock selection in Gold dectracted performance. Some of the larger stock contributors included oveweigths in New Hope and NIB and underweight Brainchip, Magelln and Megaport.
Performance Commentary - October 31, 2022 During the September quarter, Karara was replaced by Acadian as the manager of the portfolio. Acadian generated very strong performance over the quarter from stock and industry sector selection relative to the S&P/ASX Small Ords index. Good stock selection in Banks, Consumer Discretionary, Energy, Industrials, IT, Metals and Mining, while a large overweight in the Energy secotor was the main contributor to sector outperformance. Stock selection in Gold dectracted performance. Some of the larger stock contributors included oveweigths in New Hope and NIB and underweight Brainchip, Magelln and Megaport.
Performance Commentary - September 30, 2022 During the September quarter, Karara was replaced by Acadian as the manager of the portfolio. Acadian generated very strong performance over the quarter from stock and industry sector selection relative to the S&P/ASX Small Ords index. Good stock selection in Banks, Consumer Discretionary, Energy, Industrials, IT, Metals and Mining, while a large overweight in the Energy secotor was the main contributor to sector outperformance. Stock selection in Gold dectracted performance. Some of the larger stock contributors included oveweigths in New Hope and NIB and underweight Brainchip, Magelln and Megaport.
Performance Commentary - August 31, 2022 Global markets were rattled in June after several central banks lifted interest rates to fight inflation, stoking fears of recession. The US Federal Reserve lifted its benchmark rate in the biggest increase since 1994, while central banks in Switzerland, England, New Zealand and Australia all followed. Data in the US showed inflation running at the highest level in 40 years. In Australia the broad-based S&P/ASX 300 Index ended the month down 2.76% while the Small Ordinaries Index fell 7.01%. The US Fed lifted the official interest rate by 0.75% as it intensified efforts to combat inflation. Fed Chairman Jerome Powell pointed to another 0.50% to 0.75% increase at the July meeting however he added that large increases like that in June would not become ‘‘common’’.
In Australia, the Reserve Bank blindsided many economists when it increased the cash rate from 0.35% to 0.85%, the largest increase in 22 years, and forecast inflation to peak above 7% later this year. ‘‘While inflation is lower than in most other advanced economies, it is materially higher than earlier expected,’’ Governor Phillip Lowe said, citing supply chain and Ukraine as the main contributors
Governor Lowe noted that a cash rate of 2.5% was a ‘‘reasonable’’ expectation for how high rates would get to ‘‘at some point’’, but how fast they got there would be determined by future events. The yield on the 10-year Australian government bond rose to 4.2%, a level not seen since 2014. The yield on the three-year bond surged 15 basis points to 3.82%, the highest level since March 2012.
Commodity prices were mixed. Supply chain pressures saw Brent Oil climb 10% to $122 while Iron Ore prices dropped 5% to$137 as China Covid restrictions impacted demand. Gold fell US$60 to US$1,852 largely reflecting the strength of the US dollar, the secondbest performing fiat currency this year to date, coming in behind the Russian ruble.
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