September, 2023
The Russell Investments Australian Opportunities Fund underperformed the benchmark in the September quarter.
Contributing to the Fund’s underperformance was a material overweight to the poorperforming healthcare space. Stock selection within the sector also weighed on returns, including overweights to ResMed, Ansell and New Zealand’s Fisher & Paykel Healthcare. All three stocks recorded sharp declines for the quarter. An underweight exposure to the financials space also detracted from performance; notably underweights to National Australia Bank, Commonwealth Bank of Australia and ANZ Group. Performance was further impacted by stock selection within the consumer discretionary sector. This included underweights to Wesfarmers, Premier Investments and electronics retailer JB HiFi. Other key holdings to impact returns over the period were overweights to Alumina and mobile payments company Block. In contrast, the Fund benefited from stock selection amongst consumer staples, including underweights to major grocery retailers Coles and Woolworths and New Zealand’s a2 Milk Company. Stock selection amongst property trusts also added value over the period; notably an overweight to industrial property giant Goodman Group. Stock selection within the utilities space added further value; notably an underweight to APA Group, which fell sharply after raising capital to buy Alinta Energy.
Other notable positions to contribute positively to performance were an overweight to oil and gas producer Santos and an underweight to Transurban Group, which fell 11% after the competition watchdog denied the company’s planned acquisition of the EastLink toll road in Melbourne.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-18.pdfAugust, 2023
The Russell Investments Australian Opportunities Fund underperformed the benchmark in August.
Contributing to the Fund’s underperformance was stock selection within the healthcare sector, including overweights to poor-performing names like ResMed and New Zealand’s Fisher & Paykel Healthcare. Stock selection within the consumer discretionary space also weighed on returns; notably an underweight to Wesfarmers, which gained 10.6% on the back of better-than-expected earnings. Other positions within the sector to impact performance were underweights to Premier Investments and GUD Holdings; both of which recorded strong gains for the month. Returns were further impacted by stock selection amongst financials, including overweights to QBE Insurance, Afterpay owner Block and Virgin Money UK. In contrast, the Fund benefited from stock selection within the consumer staples space. This included underweights to Coles and New Zealand’s a2 Milk Company, as well as an overweight to Treasury Wine Estates; owner of the Penfolds brand. Stock selection amongst property trusts also added value over the period; notably an overweight to industrial property giant Goodman Group, which climbed almost 14% on the back of an encouraging earnings update. Other property-related positions to contribute positively to performance were underweights to Abacus Storage King and Charter Hall Long WALE REIT, which leases high-quality property assets to corporate and government tenants on a long-term basis.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-16.pdfJuly, 2023
The Russell Investments Australian Opportunities Fund outperformed the benchmark in July.
Contributing to the Fund’s outperformance was stock selection within the materials space. This included an underweight to iron ore major Fortescue Metals Group, which fell after management warned that inflationary pressures would lead to higher unit costs over the next 12 months. Other materials positions to add value were overweights to James Hardie Industries, Incitec Pivot and BlueScope Steel. All three stocks posted strong gains for the month. The Fund also benefited from stock selection within the industrials sector; notably an overweight to Downer EDI and an underweight to supply-chain logistics firm Brambles. Stock selection amongst communication services names added further value in July, including an underweight to Telstra and overweights to Seek and REA Group. In contrast, a material underweight to the strong-performing financials sector detracted from overall performance. This included underweights to the ‘Big Four’ banks – all of which recorded good gains for the month – and an overweight to QBE Insurance. Stock selection within the information technology space also weighed on returns; notably an underweight to internet connectivity business Megaport, which climbed almost 42% after management upgraded the company’s earnings guidance. Performance was further impacted by an overweight to the poor-performing healthcare sector; notably an overweight to Ansell, which fell nearly 10% after the company warned that an oversupply of its products would impact earnings.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-14.pdfMay, 2023
The Russell Investments Australian Opportunities Fund outperformed the benchmark in May.
Contributing to the Fund’s outperformance was strong stock selection within the energy space, including overweights to oil and gas producer Santos and energy retailer Ampol.
Nil holdings in poor-performing names like uranium explorer Paladin Energy and coal miners New Hope Corp. and Whitehaven Coal also added value in May. Stock selection within the materials sector added further value over the period; notably an overweight to James Hardie Industries and underweights to iron ore majors BHP Group and Fortescue Metals Group. A sizable underweight to financials was also positive, with the sector underperforming the broader market over the period. This included underweights to Westpac Banking Corp., National Australia Bank and ANZ Group. Other notable positions to contribute positively to performance were overweights to software company Xero, Lynas Rare Earths and Lendlease. In contrast, stock selection within the healthcare space detracted from overall returns in May. This included an underweight to New Zealand’s Fisher & Paykel Healthcare, which fell sharply after the company reported a 34% decline in net profit. Stock selection within the communication services sector also weighed on performance; notably an underweight to Telstra. Other key holdings to impact returns were overweights to gold miner Newcrest Mining, IDP Education and BlueScope steel. All three stocks posted sharp declines for the month.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-12-1.pdfApril, 2023
The Russell Investments Australian Opportunities Fund outperformed the benchmark in April.
Contributing to the Fund’s outperformance was strong stock selection within the materials sector, including underweights to major miners BHP Group and Fortescue Metals Group; both of which fell amid a build-up of iron ore inventories and concerns over Chinese demand. An overweight to takeover target Newcrest Mining also added value; its stock climbing almost 8% after US suitor Newmont Corp. upped its offer for the company.
Stock selection within the information technology space added further value in April; notably an overweight to cloud connectivity provider Megaport, which jumped 37% on the back of a strong earnings update. Other key holdings to add value were overweights to Virgin Money UK, QBE Insurance and ResMed. In contrast, stock selection within the consumer discretionary sector detracted from overall performance in April, including underweights to Wesfarmers, Corporate Travel Management and Super Retail Group; owner of brand names such as Supercheap Auto, BCF and Rebel. Stock selection within the industrials sector also weighed on returns; notably an underweight to toll road operator Transurban Group, which rose almost 6% after average daily traffic volumes increased sharply in the March quarter. Other notable positions to impact performance over the period were an overweight to BlueScope Steel and underweights to National Australia Bank and Westpac Banking Corp.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-10.pdfMarch, 2023
The Russell Investments Australian Opportunities Fund outperformed the benchmark in the March quarter.
Contributing to the Fund’s outperformance was a large underweight exposure and strong stock selection within the financials space. This included underweights to National Australia Bank, Commonwealth Bank of Australia, Westpac Banking Corp. and ANZ Group; collectively known as the ‘Big Four’. All four banks significantly underperformed the broader market over the period. An overweight to QBE Insurance also added value.
Stock selection amongst real estate investment trusts added further value in the first quarter; notably an overweight to industrial property giant Goodman Group, which climbed more than 8% after management upgraded its earnings guidance. The Fund also benefited from positive stock selection within the energy space, including a nil exposure to Whitehaven Coal, which fell almost 26% on the back of declining coal prices. Other notable positions to add value over the period were overweights to takeover target Newcrest Mining, The Lottery Corp. and plumbing supplies group Reece Ltd. In contrast, stock selection amongst consumer-related names detracted from overall performance, including underweights to Wesfarmers, Flight Centre and Woolworths.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-9-1.pdfFebruary, 2023
The Russell Investments Australian Opportunities Fund outperformed the benchmark in February.
Contributing to the Fund’s outperformance was strong stock selection within the materials space. This included underweights to BHP Group and Pilbara Minerals and an overweight to gold miner Newcrest Mining. BHP and Pilbara fell amid general weakness across the broader commodities complex, while Newcrest rose on news Newmont – the world’s largest gold miner – had made a $24.5 billion play for the company. [Note: Newcrest’s board rejected the offer on the basis that it was too low]. Stock selection within financials also added value in February; notably an overweight to QBE Insurance, which climbed almost 10% on the back of a positive earnings update. Material underweights to Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp. added further value. In contrast, an underweight to the consumer staples sector, which outperformed the broader market in February, detracted from overall performance. This included underweights to Woolworths and Coles. Stock selection amongst industrials also weighed on returns; notably an underweight to toll road operator Transurban Group, which rose after management announced record first-half earnings. Other key holdings to impact performance were overweights to Domino’s Pizza, Downer EDI and Lendlease.
The Fund is currently overweight the quality factor and has more neutral positioning to growth and value factors.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-8.pdfJanuary, 2023
The Russell Investments Australian Opportunities Fund underperformed the benchmark in January.
Contributing to the Fund’s underperformance was poor stock selection within the materials space. This included underweights to lithium producer Pilbara Minerals, iron ore major BHP Group and diversified miner South32. An overweight to chemicals company Incitec Pivot also weighed on returns. Performance was further impacted by an overweight to the healthcare space, which underperformed the broader market in January; though this was partly offset by positive stock selection within the sector, including an overweight to medical device company ResMed. Overweight exposures to the utilities and energy sectors also detracted from performance, albeit modestly. In contrast, the Fund benefited from strong stock selection within the financials space; notably a material underweight to Westpac Banking Corp. Stock selection amongst property trusts also added value over the period, including overweights to industrial property giant Goodman Group and Lendlease; both of which posted strong gains for the month. Property trusts benefited in part from the sharp decline in long-term government bond yields we saw in January. Other notable positions to add value over the period were overweights to BlueScope Steel, IDP Education and James Hardie Industries. We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-7-1.pdfDecember, 2022
The Russell Investments Australian Opportunities Fund underperformed the benchmark in the December quarter.
Contributing to the Fund’s underperformance was poor stock selection within the materials space, including underweights to BHP Group, Fortescue Metals Group and Rio Tinto; all of which posted double-digit gains for the quarter. Stock selection amongst property trusts also weighed on returns; notably an overweight to Lendlease and an underweight to Scentre Group. Performance was further impacted by stock selection within the energy sector, including an overweight to Santos, which significantly underperformed the broader market over the period. Other key holdings to impact returns were overweights to ResMed and embattled casino operator Star Entertainment. In contrast, the Fund benefited from stock selection within financials; notably an overweight to Virgin Money UK, which jumped almost 57% in the wake of soaring profits. Stock selection within utilities also added value, including an overweight to Origin Energy, which rallied after Canada’s Brookfield Asset Management and US private equity firm MidOcean Energy made a surprise $18.4 billion bid for the company. Other key holdings to add value were overweights to Newcrest Mining, QBE Insurance and Qantas. In terms of factor performance, our value bias contributed positively to overall performance while our quality growth exposure proved to be a headwind.
We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-6-2.pdfNovember, 2022
The Russell Investments Australian Opportunities Fund underperformed the benchmark in November. However, the Fund did deliver positive absolute returns for the month.
Much of the Fund’s underperformance was driven by a sizable underweight exposure and poor stock selection within the materials space. This included underweights to iron ore majors BHP Group, Fortescue Metals Group and Rio Tinto. Stock selection within energy also weighed on returns; notably an overweight to oil and gas producer Santos, which significantly underperformed the broader market over the period. Other key holdings to impact performance were overweights to ResMed, James Hardie Industries and Lendlease Group. In contrast, the Fund benefited from an underweight exposure and strong stock selection within the banking sector; notably a material underweight to Commonwealth Bank of Australia. An overweight to Virgin Money UK was also positive; the stock climbing almost 26% as earnings jumped on the back of a higher interest rate environment. Stock selection within utilities added further value in November; notably an overweight to Origin Energy, which jumped more than 40% after Canada’s Brookfield Asset Management and US private equity firm MidOcean Energy made a surprise $18.4 billion bid for the company. Meanwhile, factor positioning had no material impact on overall performance.
We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-5-2.pdfOctober, 2022
The Russell Investments Australian Opportunities Fund underperformed the benchmark in October.
The Fund’s underperformance was driven in large part by a material underweight to banks; notably Commonwealth Bank of Australia, Westpac Banking Corp. and National Australia Bank. All three stocks posted very strong gains for the month. Stock selection amongst property trusts also weighed on returns, including underweights to strongperforming names like Scentre Group and Charter Hall Group. Performance was further impacted by an overweight exposure to the healthcare space; the sector significantly underperforming the broader market over the period. Other notable positions to impact returns were overweights to ResMed, Ampol and Lendlease. In contrast, the Fund benefited from strong stock selection within materials; notably underweights to major miners BHP Group, Fortescue Metals Group and Rio Tinto. Our broader underweight to the sector also added value. Stock selection amongst industrials added further value over the period, including an overweight to national carrier Qantas, which jumped almost 17% on the back of better-than-expected earnings. Other key holdings to contribute positively to performance were an underweight to Woolworths and an overweight to Virgin Money UK. Meanwhile, factor positioning had no material impact on overall performance in October.
We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-3-1.pdfSeptember, 2022
The Russell Investments Australian Shares Fund significantly outperformed the benchmark in the September quarter. Stock selection within the materials space contributed positively to performance over the period. This included an overweight to OZ Minerals, which climbed almost 46% on the back of an $8.3 billion takeover offer from mining heavyweight BHP Group. [Note: OZ Minerals’ board rejected the offer on the basis that it significantly undervalued the company.] Stock selection within industrials also added value; notably underweights to Transurban Group and Atlas Arteria. Both stocks recorded steep declines for the quarter. The Fund’s exposure to several quality growth names added further value over the period, including overweights to ResMed and IDP Education. Other key holdings to contribute positively to returns were overweights to Allkem and IGO Ltd. and an overweight to Whitehaven Coal, which hit a series of record highs as Europe sought alternative energy supplies. In contrast, stock selection within financials detracted from overall performance, including overweights to QBE Insurance and Suncorp Group. Stock selection amongst property trusts also weighed on returns; notably an overweight to industrial property giant Goodman Group. Property trusts were generally weaker in the face of sharply higher bond yields.
We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Shares_Fund-Class_A-English-RetDomEq-AUD-2.pdfAugust, 2022
The Russell Investments Australian Opportunities Fund outperformed the benchmark in August. Contributing to the Fund’s outperformance was a material underweight to banks; notably underweights to Commonwealth Bank of Australia, National Australia Bank and Bendigo and Adelaide Bank. All three stocks underperformed the broader market over the period. Stock selection within the broader financials space also added value in August, including an underweight to ASX Ltd. and an overweight to QBE Insurance. The Fund also benefited from strong stock selection within industrials. This included overweights to national carrier Qantas and Reece Ltd; both of which recorded good gains in the wake of positive earnings updates. Other key holdings to add value in August were overweights to oil and gas producer Santos and takeover target OZ Minerals. In contrast, poor stock selection within the consumer discretionary space detracted from overall performance; notably overweights to Star Entertainment Group, The Lottery Corp. and gaming machine maker Aristocrat Leisure. An underweight exposure and poor stock selection within the materials sector also weighed on returns. This included underweights to mining heavyweight BHP Group and Pilbara Minerals. Other notable positions to impact performance were overweights to ResMed and gold miner Newcrest Mining.
We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-2.pdfJuly, 2022
The Russell Investments Australian Opportunities Fund underperformed the benchmark in July. However, the Fund did deliver positive absolute returns for the month. Contributing to the Fund’s underperformance was poor stock within the financials space; notably material underweights to Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp. All three stocks recorded strong, double-digit gains for the month. A sizable overweight to QBE Insurance also weighed on returns; the stock falling more than 5.0% after a review of the company’s practices revealed that, in some cases, it failed to deliver on its policy pricing promise. Performance was further impacted by an overweight exposure and poor stock selection within the energy sector. This included overweights to oil and gas producer Santos and fuel retailer Ampol. Other notable positions to impact returns were an overweight to gold miner Newcrest Mining and underweights to Wesfarmers and CSL Ltd. In contrast, the Fund benefited from an underweight to materials, including underweights to BHP Group, South32 and Rio Tinto; all of which significantly underperformed the broader market in July. Stock selection within the communication services space also added value; notably an overweight to New Zealand’s Chorus Ltd. Other key holdings to add value were overweights to ResMed, Pinnacle Investment Management and IDP Education. We prefer more balanced exposures across both value and growth and have reduced our underweight positioning in low-volatility stocks. We recently reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-1-3.pdfMay, 2022
The Russell Investments Australian Opportunities Fund underperformed the benchmark in May.
Contributing to the Fund’s underperformance was poor stock selection within the materials space, including overweights to BlueScope Steel, Nufarm and Sims Ltd. All three stocks recorded double-digit declines for the month. An overweight exposure and poor stock selection within the communication services sector also weighed on returns; notably overweights to Seek, News Corp. and REA Group. Other key holdings to impact performance were a sizable underweight to Commonwealth Bank of Australia and overweights to Virgin Money UK and Lendlease.
In contrast, the Fund benefited from strong stock selection amongst consumer-related names. This included overweights to Tabcorp and underweights to major supermarket retailers Woolworths and Coles. An overweight exposure and positive stock selection within the energy space also added value; notably overweights to Santos and Worley Ltd. Other notable holdings to add value were overweights to The Lottery Corp. (the company formed as a result of the demerger of Tabcorp’s lotteries business), Mineral Resources and Lynas Rare Earths. Meanwhile, the Fund’s factor positioning had no material impact on overall returns in May. Moving forward, we continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks. During the month, we reduced our overweight to value and added to our quality growth exposure.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-6-1.pdfApril, 2022
The Russell Investments Australian Opportunities Fund outperformed the benchmark in April.
Contributing to the Fund’s outperformance was our value bias; notably overweights to QBE Insurance, national carrier Qantas and Coronado Global Resources. All three stocks posted strong gains for the month. An underweight exposure and strong stock selection within the materials space also added value over the period. In addition to our holding in Coronado Global Resources, this included a sizable underweight to BHP Group, which fell almost 8.0% after management warned of rising risks from inflation, lockdowns in China and the war in Ukraine. The miner was also impacted by a sharp decline in iron ore prices. Stock selection within financials added further value in April, as did an underweight to the poor-performing information technology space. In contrast, poor stock selection within the growth segment of the market detracted from overall returns. This included overweights to ResMed, IDP Education and Megaport; all of which posted double-digit declines for the month. An underweight to the consumer staples sector also weighed on performance; notably names like Woolworths, Endeavour Group and Coles. Other key holdings to impact returns were underweights to Transurban, Fortescue Metals Group and CSL Ltd.
There were no material changes to the Fund’s overall positioning during the month. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-12.pdfMarch, 2022
The Russell Investments Australian Opportunities Fund outperformed the benchmark in the March quarter.
Contributing to the Fund’s outperformance was an overweight exposure and positive stock selection within the strong-performing energy space. This included our holdings in Woodside Petroleum, Santos and Worley Ltd.; all of which posted double-digit gains for the quarter. Stock selection within the consumer discretionary sector also added value; notably, our underweight to Wesfarmers, which fell 13% as supply chain disruptions and rising costs weighed on earnings. Other notable positions to add value over the period were overweighted to Coronado Global Resources and Sims Ltd. and an underweight to CSL Ltd. In contrast, poor stock selection within the materials sector weighed on returns; notably underweight to BHP Group, which recorded very strong gains for the quarter. Underweights to fellow iron ore miners Fortescue Metals Group and Rio Tinto also weighed on returns.
Performance was further impacted by several stock-specific holdings within the growth space, including overweights to medical device company ResMed and James Hardie Industries. Other key holdings to impact returns were underweighted to Commonwealth Bank of Australia, Westpac Banking Corp. and National Australia Bank. There were no material changes to the Fund’s overall positioning during the quarter. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Multi-Asset_Income_Strategy_Fund-Class_A-English-RetMA_PSHIP-AUD-7.pdfFebruary, 2022
The Russell Investments Australian Opportunities Fund outperformed the benchmark in February. Contributing to the Fund’s outperformance was our underweight to expensive quality growth names; notably Sonic Healthcare, CSL Ltd. and Domino’s Pizza. Our overweight to cyclical stocks also added value, including our holdings in CIMIC Group and national carrier, Qantas. Both stocks posted strong gains for the month. An overweight to the energy space added further value in February; notably our holding in Woodside Petroleum, which jumped almost 23% on the back of a sharp spike in oil prices following Russia’s invasion of Ukraine. Other notable positions to contribute positively to performance were underweights to Wesfarmers and Fortescue Metals Group and an overweight to gold miner, Newcrest Mining. Newcrest surged more than 19% as investors favoured gold’s traditionally defensive qualities in the face of heightened geopolitical risks. In contrast, a material underweight to banks detracted from overall returns, including names like Westpac Banking Corp. and National Australia Bank. Stock selection within the information technology space also weighed on performance; notably an overweight to Xero and an underweight to Computershare. Other key holdings to impact returns were an underweight to BHP Billiton and an overweight to Mineral Resources.
There were no material changes to the Fund’s overall positioning during the month. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-9.pdfJanuary, 2022
The Russell Investments Australian Opportunities Fund outperformed the benchmark in January. However, the Fund did deliver negative absolute returns for the month. Contributing to the Fund’s outperformance was a material overweight to the energy space. Stock selection within the sector also added value, including overweights to oil and gas producer, Santos, Woodside Petroleum and Worley Ltd. All three stocks posted strong gains for the month. Stock selection within financials added further value over the period; notably our overweights to Virgin Money UK and QBE Insurance. The Fund also benefited from underweight exposures to more defensive growth names such as CSL Ltd. and Sonic Healthcare. Other notable positions to contribute positively to performance were overweights to Origin Energy and Alumina and an underweight to Wesfarmers. In contrast, poor stock selection within the materials space weighed the most on overall performance in January. This included underweights to mining heavyweights BHP Billiton, Fortescue Metals Group and Rio Tinto; all of which recorded good gains for the month. Stock selection within industrials also detracted from returns, albeit modestly. Other key holdings to impact performance were overweights to ResMed, Newcrest Mining and James Hardie Industries.
There were no material changes to the Fund’s overall positioning during the month. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-7.pdfDecember, 2021
The Russell Investments Australian Opportunities Fund performed in line with the benchmark in the December quarter. Contributing positively to fund performance was our material underweight to banks, including Westpac Banking Corp. and Commonwealth Bank of Australia; both of which significantly underperformed the broader market. Stock selection within the information technology space also added value over the period; notably an underweight to buy now, pay later platform Afterpay. Other notable holdings to add value were overweights to Lynas Rare Earths and Sims Ltd., and a short Domino’s Pizza position. In contrast, poor stock selection within the materials space detracted from overall performance, including underweights to iron ore majors Fortescue Metals Group and BHP Billiton. Both stocks posted double-digit gains for the quarter. An underweight exposure to property trusts also weighed on returns; notably underweights to strong-performing names like Charter Hall Group and Goodman Group. Performance was further impacted by a sizable overweight to the energy sector. This included overweights to Oil Search, Santos and Woodside Petroleum; all of which traded sharply lower over the period.
During the quarter, we broadened the investment mandate of boutique fund manager L1 Capital to include the L1 Capital Catalyst strategy. Moving forward, we continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-6.pdfNovember, 2021
November. Contributing to the Fund’s underperformance was poor stock selection within the more cyclical parts of the market; particularly amongst materials and energy names. This included overweights to Alumina, Coronado Global Resources, Oil Search and Worley Ltd.; all of which recorded sizable declines for the month. Stock selection within the utilities and industrials sectors also weighed on returns; the latter including an overweight to national carrier, Qantas. Performance was further impacted by an underweight to the consumer staples space; notably underweights to Woolworths and Coles. Other key holdings to impact returns were an overweight to Virgin Money UK and underweights to BHP Billiton and ASX Ltd. In contrast, the Fund benefited from an underweight exposure and strong stock selection within financials, including underweights to the ‘Big Four’ banks. An overweight to communication services also added value; notably our holdings in Telstra and Chorus Ltd. Other notable positions to add value in November were overweights to Lynas Rare Earths and James Hardie Industries.
During the month, we broadened L1 Capital’s investment mandate to include the L1 Capital Catalyst strategy. In order to accommodate this new strategy, we reduced the Fund’s allocations to Allan Gray, Vinva and Firetrail. Moving forward, we continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-5-1.pdfOctober, 2021
The Russell Investments Australian Opportunities Fund outperformed the benchmark in October.
Contributing to the Fund’s outperformance was strong stock selection within the materials space; notably an overweight to Newcrest Mining. Underweights to BHP Billiton, Rio Tinto and Fortescue Metals Group also added value over the period. All three stocks fell sharply amid further weakness in iron ore prices. Stock selection within the consumer discretionary sector added further value in October, including underweights to Domino’s Pizza and Flight Centre. Our underweight exposure to more defensive consumer-related names was also positive; notably an underweight to Woolworths. Other key positions to add value in October were overweights to Netwealth Group and Perenti Global. In contrast, an underweight exposure and poor stock selection within the banking sector detracted from performance, including an overweight to Virgin Money UK. Other notable holdings to impact returns were overweights to Qantas and Nufarm. Performance was further impacted by our overweight to the energy space; though this was more than offset by positive stock selection within the sector. Meanwhile, our strategic factor positioning had no material impact on overall returns in October.
There were no material changes to the Fund’s overall positioning during the month. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-3.pdfSeptember, 2021
The Russell Investments Australian Opportunities Fund outperformed the benchmark in the September quarter. Contributing to the Fund’s outperformance was positive stock selection within the more cyclical parts of the market, including underweights to Fortescue Metals Group and BHP Billiton and an overweight to Alumina. Stock selection within the healthcare space was also positive for the quarter; notably an overweight to ResMed. A material overweight to the strong-performing energy sector added further value over the period, including our holdings in Oil Search and Woodside Petroleum. Other notable positions to benefit performance were an underweight to Wesfarmers and an overweight to QBE Insurance. In contrast, an underweight exposure to banks detracted from overall returns; notably Commonwealth Bank of Australia, which hit a record high on the back of a solid earnings result and the general optimism surrounding the recovery. Poor stock selection within the information technology space also weighed on performance, including an underweight to WiseTech Global. Other key holdings to impact performance were underweights to Macquarie Group and takeover target Sydney Airport.
There were no material changes to the Fund’s overall positioning during the quarter. However, we did trim our value factor exposure in favour of more cyclical growth exposure. Overall, we continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-1-2.pdfAugust, 2021
The Russell Investments Balanced Fund performed in line with the benchmark in August. The Fund’s 70% allocation to growth assets such as Australian and global equities and listed property tends to drive returns.
The Fund’s exposure to extended fixed income contributed positively to performance, including global high-yield debt, global floating rate credit and Metrics Credit. The Fund also benefited from its exposures to global listed infrastructure and global and Australian listed property; the latter benefiting from a modest decline in longer-term government bond yields and some encouraging earnings results within the sector. In contrast, our Australian and global equity portfolios were mixed in August. In terms of domestic equities, the Russell Investments Australian Shares Core Fund delivered positive absolute and excess returns for the month, benefiting from its pro-cyclical bias and strong stock selection within the materials space.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Balanced_Fund-Class_A-English-RetMA-AUD-3.pdfJuly, 2021
The Russell Investments Australian Opportunities Fund underperformed the benchmark in July. However, the Fund did deliver positive absolute returns for the month. Contributing to the Fund’s underperformance were cyclical exposures within the value part of the market, including overweights to materials stocks Nufarm and Sims Ltd. Stock selection within the materials space more broadly also weighed on returns, including underweights to BHP Billiton and Rio Tinto; both of which hit record highs as surging iron ore prices underpinned stronger earnings. Performance was further impacted by poor stock selection within the industrials sector; notably an underweight to takeover target Sydney Airport.
Another key position to detract from returns was an overweight to Crown Resorts, which fell almost 30% after the company said it expected to post a loss this financial year as lockdowns and two royal commissions took their toll. In contrast, the Fund benefited from an underweight to the ‘Big Four’ banks; all which traded lower over the period.
An underweight exposure and positive stock selection within the poorperforming information technology sector also added value, including underweights to Computershare and Afterpay. There were no material changes to the Fund’s overall positioning during the month. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-5.pdfJune, 2021
The Russell Investments Australian Opportunities Fund underperformed the benchmark in the June quarter.
Contributing to the Fund’s underperformance was our pro-cyclical tilt as investors tended to favour quality and growth names over more cyclical, cheaper value stocks. This was a partial reversal of the trend we saw through much of the previous two quarters and was driven largely by macroeconomic news flow rather than any company-specific factors. In particular, the Fund was impacted by our cyclical positioning within the materials sector, including overweights to Incitec Pivot and Nufarm. Stock selection within the financials space also detracted from returns; notably a sizable underweight to CBA and overweights to Challenger and AMP. Returns were further impacted by a material overweight to the poor-performing energy sector, including names like Oil Search and Woodside Petroleum. In contrast, the Fund benefited from positive stock selection within the growth part of the market, including overweights to Aristocrat Leisure and Reece Ltd. Stock selection within the healthcare space also added value; notably an ex-benchmark holding in ResMed. Other key holdings to add value were underweights to APA Group and Sydney Airport. There were no material changes to the Fund’s overall positioning during the quarter. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-4.pdfMay, 2021
The Russell Investments Australian Opportunities Fund underperformed the benchmark in May. However, the Fund did deliver positive absolute returns for the month. Much of the Fund’s underperformance was driven by a handful of stock-specific positions. In particular, returns were impacted by a sizable underweight to CBA, which hit a record high on a combination of better-than-expected earnings and the general optimism surrounding the domestic growth outlook. Stock selection within the materials sector also weighed on performance; notably overweights to Incitec Pivot, Oil Search and Nufarm. Other notable positions to detract from returns were underweights to Westpac, CSL Ltd. and Woolworths.
In contrast, the Fund benefited from positive stock selection within the value space, including overweights to QBE Insurance, Newcrest Mining and Virgin Money UK. An underweight to the poor-performing information technology sector also added value; notably an underweight to buy now, pay later platform Afterpay. An underweight to utilities added further value over the period, including an underweight to AGL Energy. Other key holdings to add value were underweights to Transurban, Macquarie Group and New Zealand’s a2 Milk Company.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-1-1.pdfApril, 2021
The Russell Investments Australian Opportunities Fund underperformed the benchmark in April.
Contributing to the Fund’s underperformance was our pro-cyclical bias as investors tended to favour growth-oriented names over more cyclical, cheaper value stocks. In particular, the Fund was impacted by overweights to materials names like Incitec Pivot, Lynas Rare Earths and Coronado Global Resources; all of which traded sharply lower over the period. The Fund’s overweight to the energy sector and poor stock selection within the financials space also weighed on returns, including overweights to Challenger and AMP Ltd. Other notable positions to impact performance were underweight holdings in buy now, pay later platform Afterpay, Fortescue Metals Group and Galaxy Resources. In contrast, the Fund benefited from positive stock selection amongst some of the market’s more defensive names, including underweights to Woolworths and a2 Milk Company. An underweight to the utilities sector and strong stock selection within the healthcare space were also positive in April; the latter including an overweight to New Zealand’s Fisher & Paykel Healthcare. Other key holdings to add value were overweights to Newcrest Mining and Reece Ltd.
There were no material changes to the Fund’s overall positioning during the month. We continue to favour cyclical exposures across both value and growth (with a preference for the former) and remain underweight quality and low-volatility stocks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD-1.pdfDecember, 2020
The Russell Investments Australian Opportunities Fund outperformed the benchmark in the December quarter. Contributing to the Fund’s outperformance was our pro-cyclical bias, including an overweight to the energy sector and underweights to healthcare, utilities and consumer staples. The Fund’s value tilt was also positive as investors rotated out of expensive growth names in favour of value stocks amid encouraging vaccine developments.
Specifically, the Fund benefited from overweights to Sims Ltd., Oil Search and Virgin Money UK. Our growth exposure added further value over the period, as did our underweights to defensive names like Transurban Group and CSL Ltd. Other notable positions to add value were overweights to Alumina, Xero and national carrier, Qantas. In contrast, several stock-specific positions detracted from performance, including an overweight to Newcrest Mining and an underweight to Fortescue Metals Group.
Our underweight to banks also weighed on returns, including a material underweight to Commonwealth Bank of Australia; though this was partly offset by positive stock selection within the sector. We continue to favour cyclical exposures across both value and growth (with a preference for the former). Toward the end of the period, we added to the Fund’s cyclical positioning by reducing our exposure to expensive growth names in favour of value stocks. We also remain underweight momentum and low-volatility names.
File: https://commentary.quantreports.net/wp-content/uploads/2021/01/Russell_Investments_Australian_Opportunities_Fund-Class_A-English-RetDomEq-AUD.pdfticker: RIM0029AU
release_schedule: Quarterly
commentary_block: Array
factsheet_url:
https://russellinvestments.com/au/support/financial-adviser/business-solutions/reporting
Bottom left -> Australian Shares -> Fund Factsheet
asset_class: Domestic Equity
asset_category: Australia Large Growth
peer_benchmark: Domestic Equity - Large Growth Index
broad_market_index: ASX Index 200 Index
structure: Managed Fund
manager_contact_details: Array
fund_features:
Russell Australian Opportunities Class A aims to significantly outperform the fund’s benchmark, before costs and tax, over the long term by providing exposure to a diversified portfolio of predominantly Australian shares. The fund invests in shares and unit trusts listed or about to be listed on the Australian Stock Exchange.