Benefits of investing in the Antares Elite Opportunities Fund

Access to Antares' investment expertise

Antares believes that the pricing of individual companies and industry sectors on the Australian share market is at times inefficient. This mispricing can occur when investors take a short-term view, over-react or under-react to changes in a company's operating environment, or invest based on generalisations about similar companies. As a consequence, the price of a company sometimes differs from what Antares believes its value to be.

Antares seeks to identify and exploit these opportunities by taking a longer-term view, and through detailed systematic research of individual companies from a bottom-up perspective. In practical terms, Antares seeks to invest in companies trading on the share market at the largest discount to their underlying value.

Bottom-up research by experienced investment professionals

Underpinning Antares' approach to stock selection is an experienced team of analysts. The team gathers information through financial analysis, peer group comparison and company visits to gain a thorough understanding of the companies and the issues they face. Antares' detailed systematic research of companies is the foundation for all its investment decisions.

A high conviction portfolio aiming for better return outcomes

The Fund is a high conviction investment fund. That means Antares only invests in its best investment ideas. The Fund invests in a concentrated portfolio of up to 30 equities that are listed, or expected to be listed, on the Australian share market.

Through its concentrated portfolio, Antares aims to achieve returns that are 4% pa above the S&P/ASX 200 Accumulation Index (Benchmark) (before fees) over rolling five-year periods.

Ease of administration

It would generally be difficult for an individual investor to efficiently construct and manage a portfolio of equities similar to the Fund. Additionally, we provide investment confirmations, transaction and distribution statements, monthly Fund reports, website updates and an annual tax statement to keep you up to date on your investment. You can also access statements on your account through the online investor portal at antarescapital.com.au

Regularly add to your investment

You can choose to regularly add to your investment in the Fund through time by accessing our Regular Savings Plan.

Risk level

High-Very High

Investor suitability

The concentrated nature of the Fund means that there may be a greater level of risk. The Fund's returns may be quite volatile. As such, the Fund may suit investors who are willing to accept a higher level of risk in exchange for the opportunity to earn greater returns.

Fund description and investment return objective

The Fund is an actively managed concentrated portfolio of equities listed (or expected to be listed) on the Australian share market. The Fund's objective is to outperform the Benchmark by 4% per annum (before fees) over rolling five-year periods.

The Fund is a concentrated portfolio of our best investment ideas. The Fund is relatively unconstrained at the stock and sector level allowing the Portfolio Manager (PM) to invest in his best ideas.

The Fund takes large positions in a concentrated portfolio of no more than 30 companies. Generally at least 80% of this portfolio will be invested in companies identified as having the potential to offer significant long term value. The remaining 20% is invested in shorter term opportunities.

Key features

• Provides exposure to a concentrated portfolio of Antares' highest conviction investment ideas

• Relatively unconstrained investment guidelines within a strong risk management framework allows for significant alpha potential

• Low management fee

• Experienced investment team that manages a disciplined and robust investment process and stock analysis

Using this Fund

As a concentrated long only Australian equity product, this Fund will generally sit within the growth assets component of a balanced portfolio. Alternatively the Fund can be used as a stand alone allocation to Australian equities. Given its style agnostic philosophy, the Fund is also suitable to blend with both growth and value managers.

How we invest your money

Stock selection

The approach to stock selection is bottom-up and is focused on identifying companies where the potential value of each company's business is not fully reflected in the current share price. The PM draws on the research of the broader equities team as an input into stock selection and portfolio construction. While stock valuations provide a starting point for preferred and non-preferred stocks, the PM retains ultimate discretion over which stocks make it into the Elite Opportunities portfolio and their respective weightings.

Portfolio construction

To construct a portfolio of what are considered to be the best investment opportunities, the PM reinforces Antares' bottom-up research (which encompasses fundamental and valuation analysis) with his extensive market knowledge and experience.

Successful portfolio management involves balancing the science' of stock research and understanding, with the art' of portfolio management. In managing the portfolio, the PM selects and weights stocks on the basis of the strength of his conviction, without being constrained by individual stock or sector limits. The PM's views are not tempered by media commentary, market consensus or herd mentality. If he doesn't like a stock, he won't own it - no matter how big a part of the index it is.

Since the Fund can invest in no more than 30 companies, there is a strong sell discipline. Stocks are generally sold down when they outperform or come close to, or achieve, their assessed valuation. Central to this approach is the belief that stocks tend to mean revert over the long term.

In general, Antares aims to invest in companies where the current share price does not fully reflect its view of the potential value of each company's business. Through company contact and detailed financial and non-financial analysis, Antares' research analysts seek to gain a thorough understanding of Australian companies and the industries in which they operate.

Indicative asset allocation ranges

• Australian equities: 95 - 100%

• Cash and cash equivalents: 0 - 5%

Use of derivatives

The Fund generally uses these investments for the purpose of cash management and to minimise investment risk. The Fund can invest in a range of derivatives, typically exchange traded options or Share Price Index (SPI) contracts. These are futures contracts that provide exposure to Australia's top 200 companies without having to buy or sell shares in every company in the Index. Derivatives will not be used within the Fund for gearing purposes. More information on how derivatives are used in the Fund is in Derivatives risk' in section 4 of the PDS.