The Fund aims to outperform the RBA Cash Rate over the medium to long term. 

Benefits of investing in the Firetrail Absolute Return Fund - Class A units

Active management

• Active management | Access to an actively managed portfolio predominantly comprised of long positions and short positions in Australian listed securities.

High-quality management

• Firetrail's robust investment process.

Investment management expertise

• The expertise of Firetrail's investment team (Firetrail Investment Team), members of which have been implementing the same investment strategy since 2015.

Diversification

• The potential to diversify your existing portfolios through a net market neutral investment opportunity.

Risk level

High

Investor suitability

The Fund may be suitable for investors who are looking to outperform the RBA Cash Rate over the medium to long term and are prepared to accept the risks of the Fund set out in section 6 of the Product Disclosure Statement.

About the Fund

The Absolute Return Fund ("Fund) is a market neutral strategy with minimal correlation to equity market direction. It aims to generate positive returns in all market environments. The strategy is built on fundamental, deep dive research guided by the philosophy that every company has a price'.

The Fund is an absolute return fund which aims to generate positive returns in all market environments.

About Firetrail

Firetrail is an active investment manager, specialising in high conviction equities investing. Firetrail employs a fundamental investment approach to the Fund's long portfolio to identify companies that it believes are undervalued over the medium term. Firetrail employs fundamental and systematic investment techniques in the Fund's short portfolio with the aim of generating positive returns and mitigating risk. The investment style is unconstrained, which means Firetrail will invest in both growth' and value' companies, as well as across diverse industries and sectors. Firetrail employs a bottom-up approach to portfolio construction. Risk management is integrated throughout the process to understand and control stock specific, macroeconomic and market risk in the Fund.

How we invest your money

The Fund is typically expected to be market neutral (net market exposure generally between +/-5%), which effectively means the Fund is constructed in a way where returns are not dependent on the performance of the underlying share market.

The Fund achieves market neutrality by investing in a combination of long and short positions in equity securities listed, or expected to be listed, on the Australian Securities Exchange (ASX), as well as international markets.

Long only positions are selected using in-depth fundamental analysis. The short portfolio is constructed using a combination of fundamental analysis, systematic strategies and other value-adding strategies.

The Fund's net exposure will typically be between -5% to +5% of the Fund's NAV (with a maximum of -30% to +30% of the Portfolio's NAV). The Fund's strategy provides investors with the opportunity to gain exposure to mispriced securities identified by Firetrail using fundamental, bottom-up research. The Fund will typically hold 30 to 40 long positions and approximately 100 short positions (20 to 30 fundamentally driven short positions and 70 to 80 risk positions).

The Fund will be leveraged through short selling and the use of derivatives. Derivatives are used predominantly to establish short positions in securities or market indices and thus reduce the Fund's net exposure to markets, and to hedge currencies. Derivatives may also be used to amplify high conviction ideas.

Portfolio allocation

Net equity exposure

• Typically -5% to +5% of the Portfolio's NAV, with a maximum of -30% to +30% of the Fund's NAV.

Gross equity exposure

• Maximum of 400% of the Fund's NAV.

Firetrail may hedge currency exposure when investing in non-Australian dollar denominated investments.

In addition to holding direct assets, the Fund may also make investment indirectly, for example by investing in other managed funds where these are aligned with the Fund's investment strategy.