Market Commentary – March 2018
Apr 01, 2018

The ASX200 index fell 5.0% in a volatile quarter to close at 5,752. Australia’s economic outlook continues to improve with growth expected to continue on-trend this year. Though the housing market cycle appears to have peaked with both Sydney and Melbourne prices easing and auction clearance rates returning to average. Planned infrastructure projects are expected to support the domestic economy for several years. While employment trends continue with strong jobs growth in the economy. However,
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Market Commentary – December 2017
Dec 31, 2017

The ASX200 index completed a strong quarter raising 6.7% to close at 6,065. The RBA’s economic outlook continues to improve with growth expected to continue on-trend this year. The mining sector is expected to weaken further for some time to come. The housing market cycle appears to have peaked. Upcoming supply releasing into the market in the coming 24 months has prompted governing bodies to tighten lending standards coupled with other supervisory measures to restrain household debt levels.
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Market Commentary – September 2017
Sep 30, 2017

The ASX200 index continues to trade in a sideways holding pattern falling 0.7% to 5,681 for the quarter. Banking stocks continue to be subdued whereas material stocks like BHP and RIO have performed strongly balancing out overall market performance.
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Market Commentary – June 2017
Jun 30, 2017

The ASX200 index experienced a disappointing quarter falling approximately 2.5% to 5,721. The market began the quarter surging towards 6,000 points before being dragged back primarily by the four major banks. The banks experienced large share price declines between 10-20% triggered by the announcement of new taxes by the Federal Government. These banks currently account for approximately 25% of the ASX200 market capitalisation.
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Market Commentary – March 2017
Mar 31, 2017

The Australian market remains resilient despite the ongoing global political turmoil. The S&P ASX 200 rose 3.5% to close at 5,865. The ASX 200 continues to benefit from price recovery in the top 20 stocks by capital weighting including house hold names the likes of the banks, big resource and insurance companies. Locally the RBA (The Reserve Bank of Australia) continues to balance managing the broader economy against house price growth. With any interest rate cuts likely to fuel higher house pri
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Fund in Focus: Macquarie High Conviction Fund
Mar 31, 2017

The Macquarie High Conviction fund invests in Australian companies that the investment team believes will generate the highest returns. The investment model is concentrated as the name suggests with a maximum of 30 holdings at any time, including both value and growth shares.
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Fund in Focus: AMP Core Infrastructure fund
Dec 31, 2016

The AMP Core Infrastrucutre provides global exposure in listed and unlisted infrastructure assets which provide essential services, have monopolistic characteristics, low operating risk and volatility and predictable long duration cash flows. With the world population growing the investment into infrastructure projects is essential to provide services to people such as water, electricity and transportation.
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Market Commentary – December 2016
Dec 31, 2016

The Australian market has proven very resilient despite the political turmoil over the last 12 months. With the S&P ASX 200 shrugging off the election of Donald Trump to achieve a 4.6% increase for the quarter. Market conditions continue to be fractious, but not without opportunities. The ASX 200 benefitted strongly from price surges of the biggest 20 companies on the back of improving commodity prices. Looking ahead the political turmoil is set to continue with Elections in Germany and France
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Fund in Focus: AMP Wholesale Australian Property Fund
Sep 30, 2016

The AMP Wholesale Australian Property Fund primarily invests in direct property and may also invest in Australian listed property securities and cash to assist in managing the Fund’s return profile and liquidity. The Fund targets assets which have high occupancy rates and stable income streams underpinned by leases to long term, secure commercial and government tenants.
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Market Commentary – September 2016
Sep 30, 2016

The S&P ASX 200 has achieved a 3.87% increase however the increase does not reflect the extraordinary volatility throughout the quarter. Since February 2014 the market has fluctuated in a tight sideways channel. Market conditions continue to be fractious, but not without opportunities. With the top companies in the ASX 200 regaining some momentum due to improved commodity prices. The share market continues to present opportunities in smaller companies. With the Australian election completed the
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Fund in Focus: Australian Ethical – Australian Shares Fund
Jul 14, 2016

The Australian Ethical – Australian Shares Fund uses an Ethical Charter to seek out or avoid investments that do not fit within the charter as being socially or ethically responsible. Australian Ethical believes in the transformative power of money to achieve positive social and environmental outcomes. Their goal is to deliver socially responsible outcomes whilst delivering sustainable positive returns.
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Market Commentary – June 2016
Jun 30, 2016

The S&P ASX 200 has risen 3% with volatility continuing throughout the quarter. Since August 2015 the market continues to fluctuate in a tight sideways channel. Market conditions are proving difficult but not without opportunities. With the top 20 shares in the ASX 200 continuing to face significant headwinds, in the current market opportunities are presenting in smaller companies. The Australian Election has been counted and the Liberal Party has claimed victory and will form Government with a
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Brexit, the economy and financial markets
Jun 28, 2016

On Thursday 23 June, Britain voted to ‘Leave’ the European Union (EU) 52 - 48 per cent. But the debate about the implications for economies and financial markets is just beginning.
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Fund in Focus: Aspect Diversified Futures – Class A
Apr 15, 2016

The Aspect Diversified Futures fund is a London based investment fund manager that invests in a broad range of investments across various assets classes. This investment provides a different style to investing from the standard equity fund manager. Aspect use quantitative research to invest in global futures markets by following medium term trends.
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Market Commentary – March 2016
Mar 15, 2016

The S&P ASX 200 has fallen 4% in another volatile quarter. The market fell heavily from the New Year high with the ASX 200 falling 8% in January and recovering slowly in February and March. The major financial themes impacting the Australian market continue to be: •The price of commodities - have improved marginally after extraordinary falls •Chinese economic transition - China has indicated it currently favours reform over growth •Australian economic transition - The RBA is satisfie
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Magellan Global Equity Fund
Feb 20, 2016

This $9 Billion Fund Manager Says He's Sticking With Cash: An interesting article from Bloomberg that references Hamish Douglas head of the Magellan Global Equity Fund which is part of the global asset allocation within the Limberg Asset Management investment models.
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Fund in Focus: SG Hiscock ICE Fund
Jan 15, 2016

The SGH ICE fund is an Australian equity funds that looks to invest in industrial companies. Typically, the fund holds 40 companies that are predominately mid to small caps outside the top 100 companies. These are described as the “safe end of small caps” with the aim being to identify growing companies with strong revenue growth. The lead fund manager is Callum Burns who has over 14 year’s experience in asset management and has his own funds invested in the fund.
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Market Commentary – December 2015
Dec 15, 2015

The S&P ASX 200 increased 5.5% over the quarter. The volatility continued into December with the ASX 200 trading up to 5,400 points, with daily movements of 1% or more persisting. The major financial themes impacting the Australian market are the continuing decline of commodity prices, Chinese economic transition and the first US interest rate increase since 2008. We believe these trends will remain for the foreseeable future and we believe caution is warranted in the current market volatility.
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Market Commentary - September 2015
Sep 15, 2015

The S&P ASX 200 has fallen 8% since the beginning of the quarter. The September quarter was incredibly volatile with the S&P ASX 200 falling approximately 700 points or 13% from its high in early August. Market volatility can only be described as extreme with daily movements of 1% or more the norm rather than the exception. The major financial themes impacting the Australian market have been the continuing decline of commodity prices, Chinese Growth rates and the expected US interest rate moveme
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Market Commentary
Jul 15, 2015

The S&P ASX200 has fallen 8.8% since the beginning of the quarter. September quarter was incredibly volatile with the S&P ASX200 falling 800 points or 14% from its high in early August. Market volatility can only be described as extreme with daily movements of 1% or more the norm rather than the exception. The major financial issues impacting the Australian market have been the continuing decline of commodity prices and Chinese Growth rates. We believe these trends will remain for the foreseeabl
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Market Commentary
Mar 15, 2015

The Australian Sharemarket rose strongly in the March quarter. The S&P ASX200 closed at 5,891. The strong performance was driven by the continued search for yield. Magnified by a 0.25% pa cut in the Reserve Banks interest rate and market expectations of further interest rate cuts. Creating fear in the fixed interest market as deposits mature with investors looking to replace relatively safe high yield returns.
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Market Commentary
Dec 15, 2014

The Australian Sharemarket was extremely volatile during the December quarter, resembling a rusty old saw blade. The S&P ASX200 increased marginally over the quarter to close at 5,411.
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Market Commentary
Sep 15, 2014

The Australian Sharemarket performance has been negative this quarter with the S&P ASX200 closing at 5,292, down approximately 2% however, the gross amount is a fall of about 6.5% in the month of September.
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Market Commentary
Jun 15, 2014

The Australian market performance has been flat this quarter with the S&P ASX200 closing at 5,395, notwithstanding individual stocks within the index have experienced significant volatility.
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Market Commentary
Mar 15, 2014

Market volatility persisted into the March quarter and the Australian sharemarket closed slightly higher with the S&P ASX 200 increasing to 5,394.83. However, price movement of companies in the market continues to be very volatile.
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Market Commentary
Dec 15, 2013

The December quarter was volatile due to US tapering announcements but managed to finish the quarter higher with the S&P ASX 200 increasing to 5,352.21.
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Market Commentary
Sep 15, 2013

The September quarter was industrious despite many Global challenges with the S&P ASX 200 increasing to 5,218.90.
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Market Commentary
Jun 15, 2013

The June quarter has delivered increasing sharemarket volatility with the S&P ASX 200 closing at 4,803. The prevailing question in the Australian sharemarket continues to be whether the non-mining sector can offset the slow down occurring in the mining sector.
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Market Commentary
Mar 15, 2013

The sharemarket rally has continued into the March quarter with the S&P ASX 200 finishing at 4,967. The market sectors benefiting from the rally in the period were Consumer Staples, Telecommunications, Healthcare and Financials.
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Market Commentary
Dec 15, 2012

The December quarter has delivered relief for investors with the S&P ASX 200 finishing the quarter up 6% closing at 4,648 due to two rate cuts from the Reserve Bank of Australia (RBA) and market commentary predicting further rate cuts in 2013. The impact of the rate cuts has created a chase for yield, which has driven the market to levels not seen since March 2011 and the rise has continued into January.
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Market Commentary
Sep 15, 2012

The quarter has seen a gradual recovery in equity markets, particularly the S&P 500 achieving record highs set in mid 2000 and late 2007. The ASX 200 had a strong quarter closing at 4,387. This was an increase of 7.14% over the 3 month period. News in the quarter focused on further quantitative easing in the US, Europe and Japan.
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Market Commentary
Jun 15, 2012

The ASX 200 closed the financial year at 4094.60 which was down -5.55% for the quarter and -11.14% for the year. Throughout this quarter there has been continued volatility due to overseas influence from the USA and European countries. The news flow from Greece and Spain remains negative, the world is waiting for news on a decisive course of action to begin to solve the Euro zone issues.
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Market Commentary
Mar 15, 2012

The Australian sharemarket rose for the quarter closing at 4,335. The trend during the quarter saw a decrease in volatility however there have been no strong economic signals to drive the market. The market continues to be affected by the high level of political malaise.
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Market Commentary
Dec 15, 2011

The volatility is continuing with investors remaining nervous and uncertain in respect to the future. The quarter was marked by days of extreme volatility and poor investment sentiment due to concern in slowing economic growth in Australia and China, companies reporting lower profit expectations and/or downgrades prior to the commencement of the profit reporting season and sovereign debt issues in Europe.
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Market Commentary
Sep 15, 2011

The September quarter has been the most stressful since 2008 / 2009. Notwithstanding that the Australian and Chinese economy are resilient. The volatility has been driven by Europe and the daily movements on Wall Street.
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Market Commentary
Jun 15, 2011

Over the past year your portfolio has been changed to have exposure to investments which we believe will assist with recovery of value over the next few years.
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Market Commentary
Mar 15, 2011

The quarter has been one of two distinct periods with the Australian sharemarket making a high of 5032 on 17 February 2011 and within four weeks making a low of 4560 on 17 March 2011.
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Market Commentary
Dec 15, 2010

The ASX All Ordinaries Index is continuing on its recovery path. The index has increased by about 4.5% for the period.
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Market Commentary
Jun 15, 2010

It's been a long, albeit, slow recovery with the ASX All Ordinaries October quarter closing up 6% at 4852. While it's definitely a step in the right direction, the recovery isn't matching the levels experienced back in March this year.
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Market Commentary – September 2016

The S&P ASX 200 has achieved a 3.87% increase however the increase does not reflect the extraordinary volatility throughout the quarter. Since February 2014 the market has fluctuated in a tight sideways channel.  Market conditions continue to be fractious, but not without opportunities. With the top companies in the ASX 200 regaining some momentum due to improved commodity prices. The share market continues to present opportunities in smaller companies. With the Australian election completed the focus now turns to the American Presidential election in November.

 

Australia

  • The Reserve Bank of Australia (RBA) cut the cash rate to 1.50% p.a.
    • Economists are still predicting further rate cuts to stimulate the economy
  • The labour market has steadied with the unemployment rate at 5.7%
    • However, wage growth remains soft, a leading indicator for inflation
    • Full-time employment continues to fall and as part-time employment grows
  • Data suggests the strong housing market of recent years is coming to an end with lower housing loan approvals although house prices continue to creep higher
    • The RBA has noted the “Considerable supply of apartments scheduled to come on stream over the next couple of years, particularly in the eastern capital cities”
  • The Australian dollar remains stubbornly high against the USD closing around $0.77 USDs, despite the RBA’s desire for a lower Australian dollar
  • The inflation rate has fallen over the quarter from 1.3% to 1.0% and remains below the RBA target range of 2-3% p.a. in theory providing scope for further interest rate cuts to hopefully stimulate the economy

 

US

  • The US S&P 500 and Dow Jones Industrial Average recorded small gains reaching new highs rising 3.3% and 2.1% respectively
  • The US FED (Federal Reserve System – The US Central Bank) has delayed increasing interest rates leaving them on hold at 0.5%.
  • The recent strength in the US economy has waned with mixed economic data
  • US presidential election draws near with citizens voting on the 8th of November. From all reports it should be an interesting outcome with the divisive Donald Trump and the traditional Democrat support base not rallying to Hilary Clinton

 

Europe

  • Brexit continues to be the driving force in European markets with the resignation of David Cameron and election of Theresa May as Prime Minister to negotiate the terms of EU withdrawal
  • European economy struggles and growth as a whole remains difficult
  • Russian political issues have been overshadowed by its off shore actions
  • European Political situation remains in a state of flux in many countries in Europe with:
    • UK voting to leave the EU
    • Spain is still unable to form a Government after three elections
    • In France the far right party of le National Front is gaining momentum
    • The European mood can be summed up as:
      • Anti-Austerity
      • Anti-American
      • Anti-Euro
      • Anti-Immigration

 

China

  • The Chinese Economy has a new 5 year plan which favours growth over economic rebalancing all be it at lower target of 6%
  • The Chinese Government has increased its spending levels investing in infrastructure projects to offset a decline in private spending, this has improved commodity prices which benefits the Australian economy
  • The property issues appear to be responding to Government measures with investment increasing and growth in the level of floor space sold
  • China’s capital flight continues as more and more Chinese attempt to find ways to move their wealth off-shore to escape devaluation of the Yuan and evade capital controls

 

Recent Activity

This quarter we have continued to selectively increase cash holdings in portfolios. Investments in RXP Services (RXP) and Praemium Ltd (PPS) have performed strongly over the quarter. We continue to hold these investments long term and believe that the strong performance of these companies can continue, however it is prudent to reduce exposure at appropriate levels.

Fund in Focus: AMP Core Infrastructure fund

The AMP Core Infrastructure fund has been a recent addition to the Limberg Asset Management investment models in July 2016. The Infrastructure fund has been included to provide the models with a different asset class that is diversified from traditional equities and bonds. Infrastructure assets traditionally have defensive characteristics as they invest in large projects such as transport, energy, water and community projects which are essential to positive growth within our society. Many of these infrastructure projects create employment and provide essential services. With the world population growing the investment into infrastructure projects is essential to provide services to people such as water, electricity and transportation.

Fund objective: The fund offers strong risk adjusted return (income and capital) potential and is expected to have a low correlation to other asset classes such as equities and bonds. The goal is to outperform the 10 year Australian Govt Bond yield plus 3.25%. The fund has exceeded greater than these returns since its inception in 2007.

Fund strategy: is to invest in listed and unlisted infrastructure assets which provide essential services, have monopolistic characteristics, low operating risk and volatility and predictable long duration cash flows.

The reasons for investing in the AMP Core Infrastructure fund:

  • Provides access to direct infrastructure assets that are usually only accessible to very large institutional investors.
  • typically provides a higher and more consistent level of income with lower volatility
  • provide diversification within the Limberg Asset Management investment models with exposure to multiple asset types including airports, water, gas, electricity and transport infrastructure
  • is expected to have a low correlation to shares and bonds
  • invests in listed infrastructure securities which provide liquidity and further diversification
  • provide global diversification by investing in listed and unlisted infrastructure assets around the world. With approximately 30% exposure to Australia and 70% across the US, Europe, Asia and other regions.

 

Unlisted Infrastructure assets

A few examples of the major unlisted assets that are held within the AMP Core Infrastructure fund include:

  • Australian Pacific Airports Corporation

    APAC owns 100% of Melbourne Tullamarine airport and 90% of Launceston airports under 50 year leases from the Federal Government, with an option for another 49 years

    SA Schools

  • SA Schools Public Private Partnership comprises six new super school facilities in the greater Adelaide region is South Australia with an operational capacity of over 4,600 pre-school, primary, secondary and child care places

The AMP Core Infrastructure fund has been a recent addition to the Limberg Asset Management investment models in July 2016. The Infrastructure fund has been included to provide the models with a different asset class that is diversified from traditional equities and bonds. Infrastructure assets traditionally have defensive characteristics as they invest in large projects such as transport, energy, water and community projects which are essential to positive growth within our society. Many of these infrastructure projects create employment and provide essential services. With the world population growing the investment into infrastructure projects is essential to provide services to people such as water, electricity and transportation.

Fund objective: The fund offers strong risk adjusted return (income and capital) potential and is expected to have a low correlation to other asset classes such as equities and bonds. The goal is to outperform the 10 year Australian Govt Bond yield plus 3.25%. The fund has exceeded greater than these returns since its inception in 2007.

Fund strategy: is to invest in listed and unlisted infrastructure assets which provide essential services, have monopolistic characteristics, low operating risk and volatility and predictable long duration cash flows.

The reasons for investing in the AMP Core Infrastructure fund:

  • Provides access to direct infrastructure assets that are usually only accessible to very large institutional investors.
  • typically provides a higher and more consistent level of income with lower volatility
  • provide diversification within the Limberg Asset Management investment models with exposure to multiple asset types including airports, water, gas, electricity and transport infrastructure
  • is expected to have a low correlation to shares and bonds
  • invests in listed infrastructure securities which provide liquidity and further diversification
  • provide global diversification by investing in listed and unlisted infrastructure assets around the world. With approximately 30% exposure to Australia and 70% across the US, Europe, Asia and other regions.

 

Unlisted Infrastructure assets

A few examples of the major unlisted assets that are held within the AMP Core Infrastructure fund include:

  • Australian Pacific Airports Corporation

    APAC owns 100% of Melbourne Tullamarine airport and 90% of Launceston airports under 50 year leases from the Federal Government, with an option for another 49 years

  • SA Schools

    SA Schools Public Private Partnership comprises six new super school facilities in the greater Adelaide region is South Australia with an operational capacity of over 4,600 pre-school, primary, secondary and child care places

 

Performance

As at 30 November 2016