Home

Merlon Concentrated Australian Share Fund

About this Fund

Fund Detail

PDS https://informedinvestor.com.au/view/pds/101506-2023-11-24-02:34.pdf
FUND MANAGER Merlon Capital Partners
ASX Code
APIR HOW2217AU
ASSET CLASS AUSTRALIAN EQUITIES
INVESTMENT STYLE The Fund invests primarily in securities listed on the ASX, or those that Merlon expects to list within the next six months, as well as cash.
INVESTMENT PROFILE The Fund seeks to achieve a return target of 3-5% above the Benchmark.
CURRENCY MANAGEMENT Unhedged
INCEPTION DATE 01-02-2018
BENCHMARK S&P/ASX 200 Accumulation Index
FUND SIZE S&P/ASX 200 Accumulation Index
DISTRIBUTION FREQUENCY Quarterly
NO. OF HOLDINGS
FEES 0.52% p.a.
STRUCTURE

Benefits

Benefits

Benefits of investing in the Merlon Concentrated Australian Share Fund

  • Diversification: The Fund allows access to a portfolio of high free cash flow yielding companies selected without reference to the benchmark.
  • Investment professionals: Access to an experienced team of investment professionals who specialise in Australian equities.
  • Franking credits: The Fund aims to provide reliable and consistent income, predominantly from franked dividends.
  • Sustainable income: Potential for consistent and sustainable income by investing in undervalued shares expected to deliver an attractive dividend stream, supported by strong underlying cash flows.
  • Inflation protection: By investing in equities, the Fund aims to provide capital growth and assist investors with increases in the cost of living.

Risk level

High

Investor suitability

The Fund suits investors seeking:

  • To invest for at least five years
  • Higher levels of return (with a large proportion of returns coming from income) and are comfortable with high volatility
RISK LEVEL
INVESTOR SUITABILITY

Risks

Title
Detail

Key Features

About the Fund

Merlon believes that stocks trading below fair value will outperform through time. Merlon measures value by sustainable free cash flow yield. Merlon's investment approach is to build a portfolio invested in companies with valuation upside on a broadly equal weight basis. Merlon aims for the Fund to be fully invested in a concentrated number of large and mid-cap companies listed on the ASX.

Merlon views franking credits similarly to cash and takes a medium to long term view.

About Merlon

Merlon commenced operation in May 2010, with the objective of providing high quality, tailored investment management services to investors. Merlon's investment approach is to build a portfolio of undervalued companies with high levels of sustainable free cash flow and to then reduce some risk through the use of derivatives.

For more information, please visit www.merloncapital.com.au

Investment approach

Merlon's investment approach is to build a portfolio of undervalued, high dividend yielding companies and to then reduce some risk through the use of derivatives. Merlon aims for the Fund to be fully invested in large and mid-cap companies listed on the ASX, which are selected based on Merlon's investment philosophy.

Mandate

How we invest your money

Merlon believes that stocks trading below fair value will outperform through time. Merlon measures value by sustainable free cash flow yield. Merlon's investment approach is to build a portfolio invested in companies with valuation upside on a broadly equal weight basis. Merlon aims for the Fund to be fully invested in a concentrated number of large and mid-cap companies listed on the ASX. Merlon views franking credits similarily to cash and takes a medium to long term view for investments in the Fund.

Initial portfolio allocations are based on results from Merlon's fundamental research. Single stock, sector, liquidity and short selling constraints are then applied to derive an underlying model portfolio. Subject to qualitative, tax and risk considerations, trades are implemented to align the Fund with its underlying model portfolio.

Investment universe

The Fund's investment universe is primarily securities listed on the ASX, or those that Merlon expects to list within the next six months. The Fund can also invest in cash.

Strategic asset allocation ranges

  • Securities: 80-100%
  • Cash: 0-20%