Russell Australian Opportunities Class A aims to significantly outperform the fund’s benchmark, before costs and tax, over the long term by providing exposure to a diversified portfolio of predominantly Australian shares. The fund invests in shares and unit trusts listed or about to be listed on the Australian Stock Exchange.
The Russell Investments Australian Opportunities Fund underperformed the benchmark in the September quarter.
Contributing to the Fund’s underperformance was a material overweight to the poorperforming healthcare space. Stock selection within the sector also weighed on returns, including overweights to ResMed, Ansell and New Zealand’s Fisher & Paykel Healthcare. All three stocks recorded sharp declines for the quarter. An underweight exposure to the financials space also detracted from performance; notably underweights to National Australia Bank, Commonwealth Bank of Australia and ANZ Group. Performance was further impacted by stock selection within the consumer discretionary sector. This included underweights to Wesfarmers, Premier Investments and electronics retailer JB HiFi. Other key holdings to impact returns over the period were overweights to Alumina and mobile payments company Block. In contrast, the Fund benefited from stock selection amongst consumer staples, including underweights to major grocery retailers Coles and Woolworths and New Zealand’s a2 Milk Company. Stock selection amongst property trusts also added value over the period; notably an overweight to industrial property giant Goodman Group. Stock selection within the utilities space added further value; notably an underweight to APA Group, which fell sharply after raising capital to buy Alinta Energy.
Other notable positions to contribute positively to performance were an overweight to oil and gas producer Santos and an underweight to Transurban Group, which fell 11% after the competition watchdog denied the company’s planned acquisition of the EastLink toll road in Melbourne.
What is Russell Aust Opportunities Class A Russell Aust Opportunities Class A is an Managed Funds investment product that is benchmarked against ASX Index 200 Index and sits inside the Domestic Equity - Large Growth 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 Russell Aust Opportunities Class A has Assets Under Management of 1.42 BN with a management fee of 1.05%, a performance fee of 0 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 Russell Aust Opportunities Class A has returned 6.78% in the last month. The previous three years have returned 6.84% annualised and 13.85% each year since inception, which is when the Russell Aust Opportunities Class A 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 Russell Aust Opportunities Class A first started, the Sharpe ratio is 0.41 with an annualised volatility of 13.85%. The maximum drawdown of the investment product in the last 12 months is -9.07% and -47.04% 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 Russell Aust Opportunities Class A has a 12-month excess return when compared to the Domestic Equity - Large Growth Index of -4.02% and -1.39% 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. Russell Aust Opportunities Class A has produced Alpha over the Domestic Equity - Large Growth Index of -0.26% in the last 12 months and -0.1% since inception.
What are similar investment products?
For a full list of investment products in the Domestic Equity - Large Growth Index category, you can click here for the Peer Investment Report.
What level of diversification will Russell Aust Opportunities Class A provide?
Russell Aust Opportunities Class A has a correlation coefficient of 0.98 and a beta of 0.91 when compared to the Domestic Equity - Large Growth 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 Russell Aust Opportunities Class A and its peer investments, you can click here for the Peer Investment Report.
How do I compare the Russell Aust Opportunities Class A with the ASX Index 200 Index?
For a full quantitative report on Russell Aust Opportunities Class A compared to the ASX Index 200 Index, you can click here.
Can I sort and compare the Russell Aust Opportunities Class A to do my own analysis?
To sort and compare the Russell Aust Opportunities Class A financial metrics, please refer to the table above.
Has the Russell Aust Opportunities Class A 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 Russell Aust Opportunities Class A?
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Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the Russell Aust Opportunities Class A. All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - August 31, 2023 The Russell Investments Australian Opportunities Fund underperformed the benchmark in August.
Contributing to the Fund’s underperformance was stock selection within the healthcare sector, including overweights to poor-performing names like ResMed and New Zealand’s Fisher & Paykel Healthcare. Stock selection within the consumer discretionary space also weighed on returns; notably an underweight to Wesfarmers, which gained 10.6% on the back of better-than-expected earnings. Other positions within the sector to impact performance were underweights to Premier Investments and GUD Holdings; both of which recorded strong gains for the month. Returns were further impacted by stock selection amongst financials, including overweights to QBE Insurance, Afterpay owner Block and Virgin Money UK. In contrast, the Fund benefited from stock selection within the consumer staples space. This included underweights to Coles and New Zealand’s a2 Milk Company, as well as an overweight to Treasury Wine Estates; owner of the Penfolds brand. Stock selection amongst property trusts also added value over the period; notably an overweight to industrial property giant Goodman Group, which climbed almost 14% on the back of an encouraging earnings update. Other property-related positions to contribute positively to performance were underweights to Abacus Storage King and Charter Hall Long WALE REIT, which leases high-quality property assets to corporate and government tenants on a long-term basis.
Performance Commentary - July 31, 2023 The Russell Investments Australian Opportunities Fund outperformed the benchmark in July.
Contributing to the Fund’s outperformance was stock selection within the materials space. This included an underweight to iron ore major Fortescue Metals Group, which fell after management warned that inflationary pressures would lead to higher unit costs over the next 12 months. Other materials positions to add value were overweights to James Hardie Industries, Incitec Pivot and BlueScope Steel. All three stocks posted strong gains for the month. The Fund also benefited from stock selection within the industrials sector; notably an overweight to Downer EDI and an underweight to supply-chain logistics firm Brambles. Stock selection amongst communication services names added further value in July, including an underweight to Telstra and overweights to Seek and REA Group. In contrast, a material underweight to the strong-performing financials sector detracted from overall performance. This included underweights to the ‘Big Four’ banks – all of which recorded good gains for the month – and an overweight to QBE Insurance. Stock selection within the information technology space also weighed on returns; notably an underweight to internet connectivity business Megaport, which climbed almost 42% after management upgraded the company’s earnings guidance. Performance was further impacted by an overweight to the poor-performing healthcare sector; notably an overweight to Ansell, which fell nearly 10% after the company warned that an oversupply of its products would impact earnings.
Performance Commentary - May 31, 2023 The Russell Investments Australian Opportunities Fund outperformed the benchmark in May.
Contributing to the Fund’s outperformance was strong stock selection within the energy space, including overweights to oil and gas producer Santos and energy retailer Ampol.
Nil holdings in poor-performing names like uranium explorer Paladin Energy and coal miners New Hope Corp. and Whitehaven Coal also added value in May. Stock selection within the materials sector added further value over the period; notably an overweight to James Hardie Industries and underweights to iron ore majors BHP Group and Fortescue Metals Group. A sizable underweight to financials was also positive, with the sector underperforming the broader market over the period. This included underweights to Westpac Banking Corp., National Australia Bank and ANZ Group. Other notable positions to contribute positively to performance were overweights to software company Xero, Lynas Rare Earths and Lendlease. In contrast, stock selection within the healthcare space detracted from overall returns in May. This included an underweight to New Zealand’s Fisher & Paykel Healthcare, which fell sharply after the company reported a 34% decline in net profit. Stock selection within the communication services sector also weighed on performance; notably an underweight to Telstra. Other key holdings to impact returns were overweights to gold miner Newcrest Mining, IDP Education and BlueScope steel. All three stocks posted sharp declines for the month.
Performance Commentary - April 30, 2023 The Russell Investments Australian Opportunities Fund outperformed the benchmark in April.
Contributing to the Fund’s outperformance was strong stock selection within the materials sector, including underweights to major miners BHP Group and Fortescue Metals Group; both of which fell amid a build-up of iron ore inventories and concerns over Chinese demand. An overweight to takeover target Newcrest Mining also added value; its stock climbing almost 8% after US suitor Newmont Corp. upped its offer for the company.
Stock selection within the information technology space added further value in April; notably an overweight to cloud connectivity provider Megaport, which jumped 37% on the back of a strong earnings update. Other key holdings to add value were overweights to Virgin Money UK, QBE Insurance and ResMed. In contrast, stock selection within the consumer discretionary sector detracted from overall performance in April, including underweights to Wesfarmers, Corporate Travel Management and Super Retail Group; owner of brand names such as Supercheap Auto, BCF and Rebel. Stock selection within the industrials sector also weighed on returns; notably an underweight to toll road operator Transurban Group, which rose almost 6% after average daily traffic volumes increased sharply in the March quarter. Other notable positions to impact performance over the period were an overweight to BlueScope Steel and underweights to National Australia Bank and Westpac Banking Corp.
Performance Commentary - March 31, 2023 The Russell Investments Australian Opportunities Fund outperformed the benchmark in the March quarter.
Contributing to the Fund’s outperformance was a large underweight exposure and strong stock selection within the financials space. This included underweights to National Australia Bank, Commonwealth Bank of Australia, Westpac Banking Corp. and ANZ Group; collectively known as the ‘Big Four’. All four banks significantly underperformed the broader market over the period. An overweight to QBE Insurance also added value.
Stock selection amongst real estate investment trusts added further value in the first quarter; notably an overweight to industrial property giant Goodman Group, which climbed more than 8% after management upgraded its earnings guidance. The Fund also benefited from positive stock selection within the energy space, including a nil exposure to Whitehaven Coal, which fell almost 26% on the back of declining coal prices. Other notable positions to add value over the period were overweights to takeover target Newcrest Mining, The Lottery Corp. and plumbing supplies group Reece Ltd. In contrast, stock selection amongst consumer-related names detracted from overall performance, including underweights to Wesfarmers, Flight Centre and Woolworths.
Performance Commentary - February 28, 2023 The Russell Investments Australian Opportunities Fund outperformed the benchmark in February.
Contributing to the Fund’s outperformance was strong stock selection within the materials space. This included underweights to BHP Group and Pilbara Minerals and an overweight to gold miner Newcrest Mining. BHP and Pilbara fell amid general weakness across the broader commodities complex, while Newcrest rose on news Newmont – the world’s largest gold miner – had made a $24.5 billion play for the company. [Note: Newcrest’s board rejected the offer on the basis that it was too low]. Stock selection within financials also added value in February; notably an overweight to QBE Insurance, which climbed almost 10% on the back of a positive earnings update. Material underweights to Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp. added further value. In contrast, an underweight to the consumer staples sector, which outperformed the broader market in February, detracted from overall performance. This included underweights to Woolworths and Coles. Stock selection amongst industrials also weighed on returns; notably an underweight to toll road operator Transurban Group, which rose after management announced record first-half earnings. Other key holdings to impact performance were overweights to Domino’s Pizza, Downer EDI and Lendlease.
The Fund is currently overweight the quality factor and has more neutral positioning to growth and value factors.
Performance Commentary - January 31, 2023 The Russell Investments Australian Opportunities Fund underperformed the benchmark in January.
Contributing to the Fund’s underperformance was poor stock selection within the materials space. This included underweights to lithium producer Pilbara Minerals, iron ore major BHP Group and diversified miner South32. An overweight to chemicals company Incitec Pivot also weighed on returns. Performance was further impacted by an overweight to the healthcare space, which underperformed the broader market in January; though this was partly offset by positive stock selection within the sector, including an overweight to medical device company ResMed. Overweight exposures to the utilities and energy sectors also detracted from performance, albeit modestly. In contrast, the Fund benefited from strong stock selection within the financials space; notably a material underweight to Westpac Banking Corp. Stock selection amongst property trusts also added value over the period, including overweights to industrial property giant Goodman Group and Lendlease; both of which posted strong gains for the month. Property trusts benefited in part from the sharp decline in long-term government bond yields we saw in January. Other notable positions to add value over the period were overweights to BlueScope Steel, IDP Education and James Hardie Industries. We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
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