Magellan Global Fund (Hedged)
About this Fund
Fund Detail
PDS | https://informedinvestor.com.au/view/pds/100014-2023-11-28-02:38.pdf |
FUND MANAGER | Magellan Asset Management Ltd |
ASX Code | |
APIR | MGE0007AU |
ASSET CLASS | GLOBAL EQUITIES |
INVESTMENT STYLE | The Fund primarily invests in ASX securities, but will also have some exposure to cash & cash equivalents. Foreign exchange contracts are used facilitate settlement of stock purchases and to mitigate currency risk. The fund intends to substantially hedge the capital component of the foreign currency exposure of the Fund arising from investments in overseas markets back to Australian Dollars |
INVESTMENT PROFILE | The primary objectives of the Fund are to achieve attractive risk-adjusted returns over the medium to long-term, while reducing the risk of permanent capital loss. |
CURRENCY MANAGEMENT | Hedged |
INCEPTION DATE | 01-07-2013 |
BENCHMARK | MSCI World Index Net Total Return (Hedged to AUD) |
FUND SIZE | MSCI World Index Net Total Return (Hedged to AUD) |
DISTRIBUTION FREQUENCY | Yearly. |
NO. OF HOLDINGS | 20-40 |
FEES | 1.35% p.a. |
STRUCTURE |
Benefits
Benefits | Benefits of investing in the Magellan Global Fund (Hedged)Investing in the Fund offers investors a range of benefits, including:
An investment in the Fund may suit you if you are seeking a long-term investment exposure to international equities. |
RISK LEVEL | High |
INVESTOR SUITABILITY | An investment in the Fund may suit you if you are seeking a long-term investment exposure to international equities. |
Risks
Title | |
Detail |
Key Features
The primary objectives of the Fund are to achieve attractive risk-adjusted returns over the medium to long-term, while reducing the risk of permanent capital loss. The Fund offers investors an opportunity to invest in a specialised and focused global equity fund. In its capacity as Investment Manager, the Responsible Entity aims to invest in companies that have sustainable competitive advantages which translate into returns on capital in excess of their cost of capital for a sustained period of time. The Responsible Entity endeavours to acquire these companies at discounts to their assessed intrinsic value. The Fund's portfolio will comprise 20 to 40 investments. The Responsible Entity believes such a portfolio will achieve sufficient diversification to ensure the Fund is not overly correlated to a single company, or to industry specific or macroeconomic risks. Investment philosophyThe Magellan Global Fund (Hedged) seeks to invest in outstanding companies at attractive prices, while exercising a deep understanding of the macroeconomic environment to manage investment risk. Magellan perceives outstanding companies to be those that are able to sustainably exploit competitive advantages in order to continually earn returns on capital that are materially in excess of their cost of capital. While Magellan is extremely focused on fundamental business value, it is not a typical 'value' investor. The Magellan Global Equities Fund (Currency Hedged) will invest in companies that have relatively high price-to-earnings and price-to-book multiples, provided that their businesses are outstanding and their shares are trading at an appropriate discount to their assessed intrinsic value. Equities that appear undervalued on the basis of a low price-to-earnings or price-to-book multiples will often prove to be poor investments if the underlying business is fundamentally weak and exhibits poor returns on capital. Magellan focuses on risk-adjusted returns, rather than benchmark-relative returns. As a result, the Magellan Global Fund's investment process is designed to generate an unconstrained, concentrated portfolio of high-quality companies. Magellan believes that an appropriately structured portfolio of 20 to 40 investments can provide sufficient diversification to ensure that investors are not overly correlated to any single company, industry-specific or macroeconomic risk. |
Mandate
How we invest your moneyPortfolio constructionThe Fund's investment process integrates three key disciplines:
Intensive bottom-up stock analysis and industry research is undertaken in order to identify outstanding companies. This involves the assessment of potential investments against key quality criteria, as well as assessments of their intrinsic value. Magellan uses a proprietary ranking tool, the Magellan Conviction Scoring Matrix, to rank these companies based on these factors. This process enables the portfolio to be weighted towards higher conviction ideas (on a risk-adjusted basis). Magellan's detailed macroeconomic analysis is overlayed during portfolio construction, alongside the application of both fixed and dynamic risk limits. This process ensures that the portfolio is not overly exposed to aggregation risk (risk which arises from correlated portfolio positions) or macroeconomic event risk. Macroeconomic event risk can be a significant source of negative returns for investors. Magellan will make significant changes to the portfolio if it believes that macroeconomic events could lead to significant and sustained loss in value for investors. Such events would include a financial crisis, a sustained oil price shock, a global pandemic or a major global conflict. Investments heldThe Fund primarily invests in the securities of companies listed on stock exchanges around the world, but will also have some exposure to cash and cash equivalents. The Fund can use foreign exchange contracts to facilitate settlement of stock purchases. It is the Responsible Entity's intention to substantially hedge the capital component of the foreign currency exposure of the Fund arising from investments in overseas markets back to Australian Dollars. Asset classes and allocation rangesThe Fund's assets are typically invested within the following asset allocation ranges:
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