Paradice Australian Equities Fund is an Managed Funds investment product that is benchmarked against ASX Index 200 Index and sits inside the Domestic Equity - Large Cap Neutral 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 Paradice Australian Equities Fund has Assets Under Management of 44.00 M with a management fee of 0.75%, a performance fee of 0.00% and a buy/sell spread fee of 0.4%.
The recent investment performance of the investment product shows that the Paradice Australian Equities Fund has returned 0.52% in the last month. The previous three years have returned 8.74% annualised and 15.13% each year since inception, which is when the Paradice Australian Equities Fund first started.
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 Paradice Australian Equities Fund first started, the Sharpe ratio is NA with an annualised volatility of 15.13%. The maximum drawdown of the investment product in the last 12 months is -6.88% and -28.25% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
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 Paradice Australian Equities Fund has a 12-month excess return when compared to the Domestic Equity - Large Cap Neutral Index of -1.63% and 0.8% since inception.
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. Paradice Australian Equities Fund has produced Alpha over the Domestic Equity - Large Cap Neutral Index of NA% in the last 12 months and NA% since inception.
For a full list of investment products in the Domestic Equity - Large Cap Neutral Index category, you can click here for the Peer Investment Report.
Paradice Australian Equities Fund has a correlation coefficient of 0.96 and a beta of 0.93 when compared to the Domestic Equity - Large Cap Neutral 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.
For a full quantitative report on Paradice Australian Equities Fund and its peer investments, you can click here for the Peer Investment Report.
For a full quantitative report on Paradice Australian Equities Fund compared to the ASX Index 200 Index, you can click here.
To sort and compare the Paradice Australian Equities Fund financial metrics, please refer to the table above.
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.
SMSF Mate does not receive commissions or kickbacks from the Paradice Australian Equities Fund. All data and commentary for this fund is provided free of charge for our readers general information.
The portfolio performance was near flat over the quarter. The top relative contributors to performance for the quarter are as follows:
Galaxy Resources (GXY)
Overweight Galaxy rose on a merger with Orocobre that will create a global top five lithium producer.
Uniti Group (UWL)
Overweight Uniti outperformed as broadacre housing approvals rose, accelerating demand for their fibre assets.
ALS (ALQ)
Overweight ALS reported their full year results that showed positive operating trends, particularly in the geochemistry division which is seeing strong demand from rising commodity prices.
The top relative detractors from performance for the quarter are as follows:
Incitec Pivot (IPL)
Overweight Incitec underperformed following news that their US ammonia plant was not working properly. The outages mean they risk missing out on harnessing the benefits of the current high ammonia prices.
Santos (STO)
Overweight Santos outperformed peers, but the Energy sector underperformed despite a rising oil price as investors increased their focus on carbon emissions and forced asset divestitures in the sector.
Aristocrat Leisure (ALL)
Underweight (not held) Aristocrat announced their half year report that revealed a strong recovery in land-based gaming in the US, while their digital business continued to perform well.
The portfolio underperformed over the quarter largely due to negative stock selection.
The top relative contributors to performance for the quarter are as follows:
Transurban (TCL) Underweight / Not held Transurban fell on the Victorian lockdown and subdued traffic recovery. TCL’s 2.5% estimated FY21 distribution yield also compares unfavourably to other infrastructure and REIT stocks.
SIMS (SGM) Overweight Sims rallied on improving fundamentals and pricing in scrap markets as well as general strength in commodity stocks given the weakness in the USD.
BHP (BHP) Overweight BHP rallied on stronger iron ore as well as general strength in commodity stocks.
The top relative detractors from performance for the quarter are as follows:
Newcrest (NCM) Overweight Newcrest underperformed on a weaker gold price and as investors rotated to cyclicals.
Fortescue (FMG) Underweight Fortescue rallied on stronger iron ore and the portfolio was underweight. The portfolio though now holds a position due to our now positive view on the iron ore outlook.
QBE Insurance (QBE) Overweight QBE underperformed after warning on higher catastrophe and past claim costs. We continue to hold the stock as we remain confident on the pricing cycle.
PORTFOLIO CHANGES
Positioning was rotated more towards stocks with cyclical exposure in the December quarter, with funding sources coming from defensive names. The portfolio has taken new positions in commodity stocks exposed to Electric Vehicles as governments globally look to accelerate that transition.
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