Benefits of investing in HM1

Hearts and Minds offer shareholders a range of benefits. We believe our investment strategy provides shareholders with a unique opportunity to capitalise on and benefit from, a low cost, professionally-managed high conviction fund.

In addition to the many benefits of investing in listed investment companies, the unique benefits of investing in Hearts and Minds include:

• Exposure to 25+ of only the highest conviction ideas from a select group of fund managers;

• Exposure to the investment approaches, expertise and philosophies of at least 15 different fund managers, many of whom are not readily accessible to retail investors;

• Easy access to a concentrated portfolio of globally listed securities constructed to maximise shareholder returns over the long term (being three to five years);

• Access to a portfolio that is not solely led by one fund manager's direction;

• Supporting medical research in Australia.

About the Fund

Hearts and Minds Investments Limited was born out of the investment and philanthropic vision of the Sohn Hearts & Minds Investment Leaders Conference with the dual goal of providing investors with great investment opportunities while giving financial support to medical research institutes across Australia.  

The Sohn Hearts and Minds Conference is one of Australia's premier investor events and is proudly the official Australian affiliate of the Sohn Conference Foundation. Each year, top-performing local and global fund managers have 8 minutes to pitch their best investment idea in a TEDx-style format. Since 2016, the conference has raised over $10m for Australian medical research. 

In previous years, the majority of the conference recommendations have generated strong positive investment returns, sparking significant investor demand for an accessible way to gain exposure to the stocks pitched at the conference. Hearts and Minds Investments Limited (HM1) formed to meet this demand.

HM1 is a unique listed investment company striving to deliver attractive equity investment returns for shareholders, while providing funding for Australian medical research. HM1 listed on the Australian Stock Exchange (ASX) on November 14, 2018. The fund was oversubscribed in just three days, raising $500 million across 5,500 shareholders.

Hearts and Minds' esteemed collective of top-performing core fund managers generously share their highest conviction stock recommendations to the Company. Many of these funds are not accessible to retail investors, providing HM1 shareholders with an opportunity to benefit from those managers' highest conviction investment ideas. The unique blend of manager investment philosophies and styles aims to minimise the portfolio's investment bias, and despite the relatively small number of securities (25-35), the portfolio has diversified exposure across multiple regions and sectors.

Our charitable goal is made possible by waiving typical investment fees and instead of making a sizeable donation to our suite of medical research beneficiaries. The donation amount is a percentage of our Net Tangible Asset value (NTA), which we publish to market every week. It will create a growing and sustainable funding model for our beneficiaries. This would not be possible without the generous pro-bono commitment from our fund managers, key service providers and Board.

How we invest your money

Overseen by our Investment Committee, the portfolio is constructed around the recommendations from our selected fund managers. We seek to create a relatively concentrated portfolio of between 25 and 30 Australian and internationally-listed securities.

Our fund managers have strong performance track records and have very high conviction in the stock/s they recommend. We maintain a regular dialogue with each manager to ensure their conviction in the stock remains intact throughout the investment period. Should an investment thesis play out or change materially, the Company may close out or replace the investment recommendation after consultation with the fund manager.

The unique blend of manager investment philosophies and styles aims to minimise the portfolio's investment bias, and despite the relatively small number of securities (25-35), the portfolio has diversified exposure across geographic regions and industry sectors.

The Company will allocate 40% of the Portfolio based on the annual recommendations of

Fund Managers who present at the Sohn Hearts and Minds Investment Leaders Conference (Conference Fund Managers). Whilst past performance is no guide to future performance, the Company notes that a number of Fund Managers who have presented at previous Conferences have provided investors with a number of recommendations which have performed positively over the 12 months following that Conference.

The Company will invest 60% of the Portfolio based on the highest conviction quarterly recommendations of five leading Fund Managers (Core Fund Managers). These Fund Managers include Caledonia, Cooper Investors, Magellan Asset Management, Paradice Investment Management and Regal Funds Management.

The Investment Committee will be responsible, in conjunction with the CEO, for implementing the Investment Strategy and managing the Portfolio.