Firetrail Absolute Return Fund & Australian High Conviction Fund now available on mFund
Invest in two Firetrail funds via mFund code: FTR01 & FTR02
Firetrail is an investment management boutique founded in 2018. The firm was established with a goal to align their people with their clients. Importantly, the firm is majority owned by the investment staff and the team is invested alongside clients in the investment strategies.
While founded in 2018, the Firetrail staff have a long successful track record of investing in equities.
Prior to establishing Firetrail, the portfolio management team including Patrick Hodgens, Blake Henricks and James Miller worked together at Macquarie for over a decade. The team were responsible for managing the highly successful Macquarie High Conviction Fund, which delivered 10.6% p.a. (after fees) from inception in November 2005 to October 2017. The Macquarie High Conviction Fund was one of the top performing Australian equity funds over the medium and long term.*
Firetrail Absolute Return Fund (mFund code: FTR01)
The Firetrail Absolute Return Fund aims to deliver returns above the RBA Cash Rate over the medium to long term.
The Fund is an absolute return fund which aims to generate positive returns in all market environments.
The Fund is typically expected to be market neutral (net market exposure generally between 0% - 10%), 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, as well as both long and short positions in equity issued by companies listed, or expected to be listed, in international markets. The Fund may also gain exposure through the use of derivatives.
Positions are selected using in-depth fundamental analysis on the long side as well as an event overlay. The short portfolio is constructed using a combination of fundamental analysis and systematic strategies along with other value-adding strategies and investment timing.
The Fund may invest in securities, derivatives (such as options, futures, forwards, swaps, participatory notes, contracts for difference) and approved cash deposits and cash equivalents in Australia and international markets.
There are three key areas that generate ideas in the Investment Manager’s research process:
- Investment team ideas
- Proprietary valuation screening
- Market events and corporate activity
Benefits of investing in the Fund
- Potential to generate positive returns in both rising and falling equity markets.
- Diversification from traditional asset classes such as long-only equities, bonds and unlisted alternative investments (such as real estate).
- Unconstrained, bottom-up portfolio construction process ensures there are minimal style or sector biases, which may lead to more consistent returns by not depending on the growth and value cycles of the share market.
- Access to a high-quality investment team with a long-term track record investing in long/short equities
- A team-based portfolio management approach which may increase diversity of thought and reduce key person risk.
Firetrail Australian High Conviction Fund (mFund code: FTR02)
The Firetrail Australian High Conviction Fund aims to outperform the S&P/ASX 200 Accumulation Index over the medium to long term.
The Fund provides exposure to a concentrated portfolio of Australian equities through securities listed, or expected to be listed, on the Australian Securities Exchange and the New Zealand Stock Exchange.
The Fund aims to hold approximately 25 securities at any time. Only those securities that the Investment Manager has the highest conviction to generate the greatest returns will be included in the portfolio.
The process employs an unconstrained approach to fundamental research to identify companies which:
• offer the most attractive forecast returns based on the Investment Manager’s medium-term view; • the Investment Manager believes will not materially disappoint market expectations in the short-term; • may have ‘growth’ or ‘value’ characteristics;
Benefits of investing in the Fund
• Potential for a high level of capital growth as returns are not diluted by holding a large number of small positions. • Unconstrained, bottom-up portfolio construction approach ensures the process is style agnostic, which may lead to more consistent returns by not depending on the growth and value cycles of the share market. • Access to a high-quality investment team with a long-term track record investing in Australian equities. • A team-based portfolio management approach which increases diversity of thought and reduces key person risk.
To access further information and insights from the Firetrail team please visit www.firetrail.com/insights
Firetrail Investments Pty Limited ABN 98 622 377 913 (‘Firetrail’), Corporate Authorised Representative (No. 1261372) of Pinnacle Investment Management Limited ABN 66 109 659 109 AFSL 322140.
Any opinions or forecasts reflect the judgment and assumptions of Firetrail and its representatives on the basis of information at the date of publication and may later change without notice. Any projections contained in this article are estimates only and may not be realised in the future. The information is not intended as a securities recommendation or statement of opinion intended to influence a person or persons in making a decision in relation to investment. This communication is for general information only. It has been prepared without taking account of any person’s objectives, financial situation or needs. Any persons relying on this information should obtain professional advice relevant to their particular circumstances, needs and investment objectives. Past performance is not a reliable indicator of future performance.
Interests in the Firetrail Absolute Return Fund (ARSN 624 135 879) and Firetrail Australian High Conviction Fund (ARSN 624 136 045) (‘Funds’) are issued by Pinnacle Fund Services Limited ABN 29 082 494 362 AFSL 238371. Pinnacle Fund Services Limited is not licensed to provide financial product advice. A copy of the most recent Product Disclosure Statement (‘PDS’) of the Funds can be located at www.firetrailinvest.com You should consider the current PDS in its entirety and consult your financial adviser before making an investment decision.
Pinnacle Fund Services Limited and Firetrail believe the information contained in this communication is reliable, however its accuracy, reliability or completeness is not guaranteed and persons relying on this information do so at their own risk. Subject to any liability which cannot be excluded under the relevant laws, Firetrail and Pinnacle Fund Services Limited disclaim all liability to any person relying on the information contained in this communication in respect of any loss or damage (including consequential loss or damage), however caused, which may be suffered or arise directly or indirectly in respect of such information.