23 January 2018
The Bennelong Concentrated Australian Equities Fund has been ranked the number one Australian equities fund over one, three and five years, according to the latest Mercer investment survey (at 31 December 2017).
The Fund returned an impressive 30.7 percent return in the year to December – more than twice as strong as the benchmark S&P/ASX 200 share index, which generated a total return, including dividends, of 13 percent.
It was also named winner of Financial Standard's "high performance" category in its inaugural "Investment Leadership Awards" announced in December.
This isn't the first time the Fund has achieved the top spot in the Mercer investment survey. It was also ranked the number one Australian equities fund at the end of 2015 and 2013.
To achieve this out-performance, BAEP manages money in a flexible way, unconstrained in what or how much can be invested in a particular opportunity, and with the ability to concentrate on high conviction ideas.
Julian Beaumont, investment director at BAEP, says the goal as a fund manager is to maximise investment returns over time by selecting stocks on the basis of their upside potential and downside risk, not their weighting or position on the ASX.
"As high-conviction managers, we aren't compelled to invest just because it's a big stock or sector. It's irrelevant to us how big, popular or well-covered the company; in fact, it's often the case that the best opportunities arise where the opposite is true.
"Many of the well-owned large caps seem unexciting to us at present, so for example we don't hold Commonwealth Bank, BHP, Telstra, Woolworths or Wesfarmers in our concentrated fund.
"The businesses we are buying are defensive and resilient; it's medicine and medical services, wine, pizza, skincare, and gaming. It's basically unconstrained stock picking, with very tight controls and high conviction around stock and portfolios risks.
"We believe this approach will continue to stand us in good stead in 2018, as volatility is likely to increase and global growth may start to ease," he said.