September, 2023
Fund performance for the quarter ending September 2023 was -1.93% (net of fees) versus the benchmark return of -1.39%, as measured by the MSCI World Small Cap Net Total Return Index.
The MSCI World Small Cap index fell 1.39% in AUD terms over the quarter. Finland, Sweden and Denmark were the worst performing countries, while Portugal, Japan and Norway performed well. The UK outperformed the benchmark, while the US underperformed. Overall, global equities were under pressure as rates continued to head higher with the US 10-year yield approaching 4.6%, affecting both large-cap and small-cap equities.
The Industrials and Financials sectors were the key outperformers, while the Health Care, Utilities and Information Technologies sectors underperformed as US bond yields continue to rise.
Notable positive contributors over the period were Selective Insurance in the US and Kempower in Finland. By contrast, BE Semiconductors in The Netherlands contributed negatively to performance.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2309-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-1.pdfJune, 2023
Fund performance for the quarter ending June 2023 was +7.46% (net of fees) versus the benchmark return of +3.85%, as measured by the MSCI World Small Cap Net Total Return Index.
MSCI World Small caps rose 3.85% in AUD terms over the quarter. The Information Technologies, Health Care and Industrials sectors were the key outperformers while Communication Services, Materials and Real Estate sectors underperformed. The US and parts of Europe outperformed the wider developed markets over the period.
Notable positive contributors over the period were Vertiv, Be Semiconductor Industries, Topbuild and Atkore while European Industrials Valmet and Andritz contributed negatively to performance.
Pleasingly Atkore was up 33.5% in June, reversing some weaker performance earlier in the past quarter. Atkore continues to be a well-run US based industrial focused on non-residential Capital Expenditure and the electrification of the US.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2306-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-2.pdfMarch, 2023
Fund performance for the quarter ending March 2023 was +4.35% (net of fees) versus the benchmark return of +5.60%, as measured by the MSCI World Small Cap Net Total Return Index.
MSCI World Small caps index rose 5.60% in AUD terms over the quarter, with returns being largely driven by the Information Technology, Consumer Discretionary, Industrials and the Materials sectors, all delivering strong positive performance. The Financial and Real Estate sectors underperformed the market with negative absolute returns.
The Fund underperformed the index by 1.25% over the quarter. On a positive absolute basis, our Industrials holdings continued to deliver strong increases in near-term earnings expectations. Our large underweight in the Financials sector benefited performance, though we have had major concerns over the effect of the yield curve on Regional US Banking and US Commercial Real Estate. Our large underweight in the Real Estate sector also helped returns. On the negative side, our Materials investments underperformed the index and were a drag on performance.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2303-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-1.pdfDecember, 2022
Fund performance for the quarter ending December 2022 was +5.33% (net of fees) versus the benchmark return of +5.01%, as measured by the MSCI World Small Cap Net Total Return Index. MSCI World Small caps rose 5.01% in AUD terms over the quarter. The Materials and Industrials sectors led the market. The Energy, Consumer Discretionary, Consumer Staples and Financials sectors also outperformed. However, the Health Care, Communication Services, Real Estate, Information Technology and Utilities sectors underperformed the market. The UK and parts of Europe outperformed the wider developed markets over the period.
The Fund outperformed the index by 0.32% over the quarter driven by strong stock selection and a number of strong results across the portfolio holdings. The Fund’s investments in structural growth businesses in the Communication Services sector were the main drivers of outperformance. Our stock selection in the Consumer Staples, Financials, Health Care, Consumer Discretionary, Information Technology and Materials sectors were also positive contributors to performance. On the negative side, our positions in the Industrials, Real Estate and Utilities sectors lagged the index this quarter.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2212-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-1.pdfSeptember, 2022
Fund performance for the quarter ending September 2022 was -2.40% (net of fees) versus the benchmark return of +1.31%, as measured by the MSCI World Small Cap Net Total Return Index. MSCI World Small caps rose 1.31% in AUD terms over the quarter. The Energy and Health Care sectors led the market. The Financials, Industrials and Information Technology sectors also outperformed the market. The Communication Services, Real Estate, Consumer Staples, Utilities, Materials and Consumer Discretionary sectors underperformed the market. The US outperformed the wider developed markets over the month. The Fund underperformed the index by 3.71% over the quarter. Our Consumer Discretionary and Information Technology holdings were the major negatives. Our investments in the Financials, Energy and Consumer Staples sectors lagged the index over the month. Our positions in the Communication Services, Industrials, Materials, Real Estate and Utilities sectors were positive for performance.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2209-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-1.pdfJune, 2022
Fund performance for the quarter ending June 2022 was -11.61% (net of fees) versus the benchmark return of -9.56%, as measured by the MSCI World Small Cap Net Total Return Index.
MSCI World Small caps fell 9.56% in AUD terms over the quarter. The Materials and Communication Services sectors fell the most. The Consumer Discretionary, Real Estate, Industrials and Information Technology sectors were also very weak over the month. The Consumer Staples sector returned positive performance as the market sought safety of earnings. The Energy sector had a strong quarter but weakened considerably in June.
The Fund underperformed the index by 2.05% over the Quarter. Our Healthcare and Information Technology holdings were the major negative, as despite their defensive nice earnings profiles, they were sold down with the broader market. Our relative avoidance of cyclical businesses in the Materials and Consumer Discretionary sectors was positive for performance.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2206-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-1.pdfMarch, 2022
Fund performance for the quarter ending March 2022 was -21.49% (net of fees) versus the benchmark return of -9.48%, as measured by the MSCI World Small Cap Net Total Return Index. MSCI World Small caps fell 9.48% in AUD terms over the quarter, as rising inflation concerns, higher bond yields and Russia’s ongoing invasion weighed on equities. Across the quarter, the Energy sector led the market up 31%. The Utilities, Materials, Financials, Real estate and Consumer Staples sectors also outperformed the market. The Consumer Discretionary, Health Care, Information Technology, Industrials and Consumer Services sectors lagged the market.
The US led the overall market. By contrast, the UK, parts of the European Union and the Japanese markets delivered poor returns in AUD terms over the month. The fund underperformed the benchmark by 12.02% over the quarter. Both asset allocation and stock selection were negative contributors for the month, with holdings in the Health Care and Consumer Discretionary sectors particularly disappointing. The Fund’s performance suffered relative to the benchmark owing to the relative bias towards high quality companies and companies with positive earnings revisions, with the market rewarding the opposite characteristics over the period.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2203-Ausbil-Global-SmallCap-Product-Report_AAP8285AU-1.pdfJune, 2021
Fund performance for the quarter ending June 2021 was +6.55% (net of fees) versus the benchmark return of +6.50%, as measured by the MSCI World Small Cap Net Total Return Index. MSCI World Small Caps rose +6.50% in AUD terms over the quarter. Equity markets continued to see record inflows, with annualised inflows in H1 2021 of US$1.2 trillion, exceeding the cumulative inflows of the past 20 years. Earnings expectations were broadly more positive than investors were expecting. Over the quarter, the Energy sector led the market. The Communication Services, Real Estate and Information Technology sectors were also strong. The Consumer Staples and Financials sectors lagged the market. Parts of the European Union led the overall market. The US was also ahead of its peers. The UK and Japanese markets underperformed in AUD terms over the quarter.
The Fund outperformed the index by +0.05% over the quarter driven by strong stock selection. The Fund’s investments in the Industrials and Health care sectors were the main drivers of outperformance. Our stock selections in the Consumer Staples and Financials sectors were also positive contributors to performance. On the negative side, the Fund’s holdings in the Communication Services and Consumer Discretionary sectors gave back some strong recent performance over the quarter. Our position in the Information Technology sector was also a detractor from performance.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2106-Ausbil-Global-SmallCap-Product-Report.pdfDecember, 2020
Fund performance for the quarter ending December 2020 was +14.83% (net of fees) versus the benchmark return of +15.04%, as measured by the MSCI World Small Cap Net Total Return Index. MSCI World Small Caps rose +15.04% in AUD terms over the quarter as the asset class delivered strong returns.
The market exhibited the same trajectory throughout the quarter with strong gains in global small caps versus global large and mid-caps. The Energy, Financials, IT, Industrials and Materials sectors lead the market. The Consumer Staples, Real Estate, and Utilities sectors lagged the market. Japan underperformed their global peers in AUD terms. The UK market was slightly ahead of the wider index, but the best returns over the month were seen in Europe and the US. The Fund underperformed the index by -0.21% over the quarter. Several of our IT holdings delivered strong performance over the quarter, we have trimmed most of those positions at their top, leaving a slightly higher cash position at the end of December than normal.
Our investments in the Industrials and Consumer Discretionary sectors were positive for performance. Stock picking was exceptionally strong in the Consumer Discretionary sector where although we are very underweight the sector versus the benchmark average, our stocks are focused on direct to consumer, auto components, and outdoor leisure. These sectors are delivering very strong growth which the market had not factored into their estimates.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/2012-Ausbil-Global-SmallCap-Product-Report.pdfasset_class: Foreign Equity
asset_category: Equity World Mid/Small
peer_benchmark: Foreign Equity - World Mid/Small Index
broad_market_index: Developed -World Index
manager_contact_details: Array
ticker: AAP8285AU
release_schedule: Quarterly
commentary_block: Array
factsheet_url:
https://www.ausbil.com.au/products/global-equities/ausbil-global-smallcap-fund
Quarterly Report
fund_features:
Ausbil Global SmallCap aims to outperform the MSCI World Small Cap Net Total Return (TR) Index in AUD over the long term by primarily investing in listed global small cap companies using Ausbil’s global small cap investment philosophy and process. Ausbil’s active global small cap investment process aims to exploit the inefficiencies within the asset class by investing in quality companies with unrecognised growth potential at attractive valuations. The investment strategy uses both qualitative and quantitative analysis and tools alongside a disciplined risk management process, with the aim of producing consistent and risk controlled outperformance.
structure: Managed Fund