Milford Dynamic (AU) (ETL6978AU) Report & Performance

What is the Milford Dynamic (AU) fund?

Milford Dynamic (AU) targets outperformance of the S&P/ASX Small Ordinaries (TR) Index over a rolling five-year period (net of fees). The Fund aims to achieve its objective by investing primarily in small to mid-cap listed or soon to be listed Australian equities. Derivatives may be used for efficient portfolio management and for foreign currency hedging.

Growth of $1000 Investment Over Time

Performance Report

Peer Comparison Report

Peer Comparison Report

Latest News & Updates For Milford Dynamic (AU)

Milford Dynamic (AU) Fund Commentary September 30, 2023

Equity markets sold-off in September as a response to a large sell-off in bonds on the realisation that rates will be higher for longer. The S&P/ASX Small Ordinaries fell 3.9% for the month against the Fund (-1.0%).

Performance was led by prospective South Australian uranium miner Boss Energy (+39.7%). Recent strong performance reflects the rapidly improving sentiment towards nuclear energy. Seven Group Holdings (+12.7%) is leveraged to demand for domestic resources and the infrastructure capex cycle, which we suspect will be a multi-year journey. Beach Energy (+7.3%) is exposed to global oil markets, along with the Australian and NZ domestic gas market.

Detractors included Waypoint REIT (-8.4%) on higher rates and Neuren Pharmaceuticals (-12.1%) on a potential competing drug for Rett syndrome being developed by Anavex Life Sciences. We continue to hold a core position in the company as the risk/reward is still attractive.

In our view, the long lag effects of monetary policy mean that economic and behavioural impacts are still ahead of us and hard to quantify. We enter the back end of the year with a diversified portfolio, given the wide array of outcomes.

READ HISTORICAL PERFORMANCE COMMENTARIES

Product Snapshot

  • Product Overview
  • Performance Review
  • Peer Comparison
  • Product Details

Product Overview

Fund Name APIR Code
? A Product Code is unique a identifier code issued by a group or governing body, to reference products in a large group. For an example, APIR codes are commonly used for Funds and Ticker codes are commonly used for Securities such as ETFs and Stocks.
Structure
?
Asset Class
? An Asset Class breakdown provides the percentages of core asset classes found within a mutual fund, exchange-traded fund, or another portfolio. Asset classes (in microeconomics and beyond) generally refer to broad categories such as equities, fixed income, and commodities.
Asset Category
? An Asset Category is a grouping of investments that exhibit similar characteristics and are subject to the same laws and regulations. Asset categories (or a sub-asset class) are made up of instruments which often behave similarly to one another in the marketplace, looking down to the Asset Category level is important if looking to build a diversified portfolio.
Peer Benchmark Name
? A Peer Index (benchmark) refers to a peer group of investment managers who have the same investment style or category. It is used to compare the performance of one manager to their peer group, which makes it simpler for investors to choose between the vast number of investment managers.
Broad Market Index
? A Market Index (benchmark) refers to a hypothetical portfolio of investments that represents a segment, asset or category of an investable market. Market Indices are used to benchmark managers performance, to assist their style reliability and ability to provide excess returns.
FUM
? Funds/Assets under management (AUM) is the total market value of the investments that a person or entity manages on behalf of clients. Assets under management definitions and formulas vary by company.
Management Fee
? A management fee is a charge levied by an investment manager for managing an investment fund. The management fee is intended to compensate the managers for their time and expertise for selecting finanical products and managing the portfolio.
Performance Fee
? A performance fee is a payment made to an investment manager for generating positive returns. This is as opposed to a management fee, which is charged without regard to returns. A performance fee can be calculated many ways. Most common is as a percentage of investment profits, often both realized and unrealized. It is largely a feature of the hedge fund industry, where performance fees have made many hedge fund managers among the wealthiest people in the world.
Spread
? A spread can have several meanings in finance. Basically, however, they all refer to the difference between two prices, rates or yields. In one of the most common definitions, the spread is the gap between the bid and the ask prices of a security or asset, like a stock, bond or commodity. This is known as a bid-ask spread.
Milford Dynamic (AU)ETL6978AUManaged FundsDomestic EquityAustralian Multi-ManagerDomestic Equity - Multi-Manager IndexASX Index 200 Index0.00 M1.12%0.20%0.3%

Performance Review

Fund Name Last Month
? Returns after fees in the most recent (last) month).
3 Months Return
? Returns after fees in the most recent 3 months.
1 Year Return
? Trailing 12 month returns.
3 Years Average Return
? Average Annual returns from the last 3 years.
Since Inc. Average Return
? Average (annualised) returns since inception
1 Year Std. Dev. (Annual)
? The standard deviation (or annual volatility) of the last 12 months.
3 Years Std. Dev. (Annual)
? The average standard deviation (or annual volatility) from the last 3 years.
Since Inc. Std. Dev. (Annual)
? The average standard deviation (or annual volatility) since the fund inception.
1 Year Max Drawdown
? The maximum drawdown in the last 12 months - a drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.
3 Year Max Drawdown
? The maximum drawdown in the last 36 months - a drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.
Since Inc. Max Drawdown
? The maximum drawdown since inception - a drawdown is a peak-to-trough decline during a specific period for an investment, trading account, or fund.
Milford Dynamic (AU)3.52%4.62%21.1%4.6%9.85%10.95%13.67%16.94%-4.44%-21.07%-26.08%

Peer Comparison

Fund Name Peer Index Name
? A group of individuals who share similar characteristics and interests are called peer groups. Peer group analysis is an essential part of assessing a price for a particular stock in investment research. The emphasis here is on making a comparison, meaning that the peer group constituents should be more or less identical to the company being examined, especially in terms of their main business and market capitalization areas.
12 Months Excess Return
? Excess returns are an important metric that helps an investor to gauge performance in comparison to other investment alternatives. In general, all investors hope for positive excess return because it provides an investor with more money than they could have achieved by investing elsewhere.
Excess Return Annualised Since Inception
? Excess returns are an important metric that helps an investor to gauge performance in comparison to other investment alternatives. In general, all investors hope for positive excess return because it provides an investor with more money than they could have achieved by investing elsewhere.
12 Months Alpha
? Alpha is used in finance as a measure of performance, indicating when a strategy, trader, or portfolio manager has managed to beat the market return over 12 months. Alpha, often considered the active return on an investment, gauges the performance of an investment against a market index or benchmark that is considered to represent the market’s movement as a whole.
Alpha Annualised Since Inception
? Alpha is used in finance as a measure of performance, indicating when a strategy, trader, or portfolio manager has managed to beat the market annualized since inception. Alpha, often considered the active return on an investment, gauges the performance of an investment against a market index or benchmark that is considered to represent the market’s movement as a whole.
12 Months Beta
? Rolling 12Month Beta is a measure of the volatility—or systematic risk—of a security or portfolio compared to the market as a whole. Beta is used in the capital asset pricing model (CAPM), which describes the relationship between systematic risk and expected return for assets (usually stocks).
Beta Annualised Since Inception
? Beta is a measure of the volatility—or systematic risk—of a security or portfolio compared to the market as a whole. Beta is used in the capital asset pricing model (CAPM), which describes the relationship between systematic risk and expected return for assets (usually stocks).
12 Months Tracking Error
? 12Month Tracking error is the difference in actual performance between a position (usually an entire portfolio) and its corresponding benchmark over the last 12 months. The tracking error can be viewed as an indicator of how actively a fund is managed and its corresponding risk level. Evaluating a past tracking error of a portfolio manager may provide insight into the level of benchmark risk control the manager may demonstrate in the future.
Tracking Error Since Inception
? Since Inception tracking error is the difference in actual performance between a position (usually an entire portfolio) and its corresponding benchmark since inception. The tracking error can be viewed as an indicator of how actively a fund is managed and its corresponding risk level. Evaluating a past tracking error of a portfolio manager may provide insight into the level of benchmark risk control the manager may demonstrate in the future.
12 Months Correlation
? Correlation, in the finance and investment industries, is a statistic that measures the degree to which two securities move in relation to each other. Correlations are used in advanced portfolio management, computed as the correlation coefficient, which has a value that must fall between -1.0 and +1.0.
Correlation Since Inception
? Correlation, in the finance and investment industries, is a statistic that measures the degree to which two securities move in relation to each other. Correlations are used in advanced portfolio management, computed as the correlation coefficient, which has a value that must fall between -1.0 and +1.0.
Milford Dynamic (AU)Domestic Equity - Multi-Manager Index1.3%1.16%NA%NA%NA%1.033.33%4.89%0.960.96

Product Details

Fund Name Verifed by SMSF Mates Manager Address Phone Website Email
Milford Dynamic (AU)Yes-https://milfordasset.com/-

Product Due Diligence

What is Milford Dynamic (AU)

Milford Dynamic (AU) is an Managed Funds investment product that is benchmarked against ASX Index 200 Index and sits inside the Domestic Equity - Multi-Manager Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Milford Dynamic (AU) has Assets Under Management of 0.00 M with a management fee of 1.12%, a performance fee of 0.20% and a buy/sell spread fee of 0.3%.

How has the investment product performed recently?

The recent investment performance of the investment product shows that the Milford Dynamic (AU) has returned 3.52% in the last month. The previous three years have returned 4.6% annualised and 16.94% each year since inception, which is when the Milford Dynamic (AU) first started.

How is risk measured in this investment product?

There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Milford Dynamic (AU) first started, the Sharpe ratio is NA with an annualised volatility of 16.94%. The maximum drawdown of the investment product in the last 12 months is -4.44% and -26.08% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.

What is the relative performance of the investment product?

Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Milford Dynamic (AU) has a 12-month excess return when compared to the Domestic Equity - Multi-Manager Index of 1.3% and 1.16% since inception.

Does the investment product produce Alpha over its Peers?

Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Milford Dynamic (AU) has produced Alpha over the Domestic Equity - Multi-Manager Index of NA% in the last 12 months and NA% since inception.

What are similar investment products?

For a full list of investment products in the Domestic Equity - Multi-Manager Index category, you can click here for the Peer Investment Report.

What level of diversification will Milford Dynamic (AU) provide?

Milford Dynamic (AU) has a correlation coefficient of 0.96 and a beta of 1.03 when compared to the Domestic Equity - Multi-Manager Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.

How do I compare the investment product with its peers?

For a full quantitative report on Milford Dynamic (AU) and its peer investments, you can click here for the Peer Investment Report.

How do I compare the Milford Dynamic (AU) with the ASX Index 200 Index?

For a full quantitative report on Milford Dynamic (AU) compared to the ASX Index 200 Index, you can click here.

Can I sort and compare the Milford Dynamic (AU) to do my own analysis?

To sort and compare the Milford Dynamic (AU) financial metrics, please refer to the table above.

Has the Milford Dynamic (AU) been independently verified by SMSF Mate?

This investment product is in the process of being independently verified by SMSF Mate. Once we have verified the investment product, you will be able to find more information here.

How can I invest in Milford Dynamic (AU)?

If you or your self managed super fund would like to invest in the Milford Dynamic (AU) please contact via phone or via email .

How do I get in contact with the Milford Dynamic (AU)?

If you would like to get in contact with the Milford Dynamic (AU) manager, please call .

Comments from SMSF Mates

SMSF Mate does not receive commissions or kickbacks from the Milford Dynamic (AU). All data and commentary for this fund is provided free of charge for our readers general information.

Historical Performance Commentary

Performance Commentary - August 31, 2023

The Fund returned -0.5% for the month, ahead of the S&P/ASX Small Ordinaries which finished down 1.2%. The benchmark delivered twice as many downgrades than upgrades, which proved tricky to navigate.

Performance was led by leading automotive marketplace Carsales (15.6%), which rallied on confidence in its international growth prospects. Boss Energy (+19.2%) rallied on the favourable supply and demand dynamic appearing in the uranium market. Monadelphous (+7.7%) continued its strong recent performance. Detractors included Iress (-38.3%) and ResMed (-24.0%). Underlying costs at Iress are rising faster than expected which means the net cost-out benefit we had hoped for is evaporating.

There was a broad degree of caution in company outlook statements and, somewhat unsurprisingly, a lack of future earnings guidance. In our view, the long lag effects of monetary policy mean that economic and behavioural impacts are still ahead of us and hard to quantify. We enter the back end of the year with a diversified portfolio given the wide array of outcomes.

Performance Commentary - July 31, 2023

The Fund returned 3.3% for the month, shy of the S&P/ASX Small Ordinaries which achieved a return of 3.6%. Overall, we were pleased that our stock picking kept us within reach, despite a far less risky portfolio.

Performance was led by Beach Energy (+19.6%) – a recent addition to the Fund. Beach is exposed to global oil markets, along with the Australian and NZ domestic gas market. Project award momentum in Monadelphous Group (+16.2%) continued in July. We’re anticipating further construction contracts in lithium and rare earths to be announced by year end. Australian Ethical Investment (+23.2%) continued its stellar run.

Detractors included our preferred lithium miner IGO (-9.2%) following an operational result, and Kelsian (-4.5%) on no major news.

Equity markets celebrated weaker inflation numbers in July. Current data coupled with robust growth is a goldilocks scenario for equity markets. We remain more circumspect, aware that equity markets tend to extrapolate the present. We continue to believe the path to a soft landing in Australia is narrow. We have long been of the view that as the economy weakens, we will rotate back into quality growth companies at attractive valuations. We have selectively started this process given our elevated cash position, however only in moderate size to date.

Performance Commentary - June 30, 2023

The Fund returned 1.7%, ahead of the S&P/ASX Small Ordinaries which made a return of 0.1% this month.

Performance was led by KFC restaurant owner Collins Foods (+17.0%) which delivered a better-than-expected earnings result. Europe operations surprised to the upside, while Australian margins appear to have bottomed. Australasian terminal provider Smartpay (+10.0%) continued its recent momentum. Diversified data centre company Macquarie Telecom (+14.8%) rallied following a trading update and equity raise.

Detractors included fuel retailer Viva Energy (-5.0%) which suffered a minor setback at its Geelong Refinery during a maintenance turnaround, and Neuren Pharmaceuticals (-11.5%) on no news.

It is becoming clear that Australia is in a two-speed economy. On one hand, the older asset-rich generation is booming from high interest rates underpinning increased spend on categories like travel and restaurants. The younger demographic, in contrast, is suffering a cost-of-living squeeze. High household debt and leverage to variable interest rates creates more risk around their consumer balance sheets. We have long been of the view that as the economy weakens, we will rotate back into quality growth companies at attractive valuations. We have selectively started this process given our elevated cash position, however only in moderate size to date.

Performance Commentary - April 30, 2023

The Fund returned 3.6% in April, ahead of the S&P/ASX Small Ordinaries which rallied 2.9%. Performance was led by Australia/New Zealand terminal provider Smartpay which rallied 25.0% following a quarterly and strategic update. Smartpay continues to gain market share and rapidly grow annuity revenues. Global patent attorney IPH rallied 9.7% following the conclusion of a cyber incident announced in March. The incident was handled well by management, with marginal delayed revenue and a minor one-off expense. Leading automotive marketplace Carsales continues to perform well (+7.4%) reflecting confidence in its international growth prospects. Detractors included youth apparel retailer Universal Store (-7.7%). We’re entering a critical phase in the Australian economy where the lagged impact from 10x consecutive rate rises will begin to drag on consumer balance sheets. While we remain defensively positioned, we have long been of the view that as the economy slows, we will rotate back into quality growth companies at attractive valuations. We have selectively started this process given our elevated cash position, however only in moderate size to date.

Performance Commentary - February 28, 2023

The Fund returned -0.9% for the month, ahead of the S&P/ASX Small Ordinaries which declined 3.7%. The resource sector lagged, giving up much of China’s reopening enthusiasm which was seen in January. Reporting season was the focus over the month, with nearly all portfolio companies announcing financial results. While the market delivered twice as many downgrades as upgrades, we fortunately navigated the month well and managed to largely evade the typical reporting season bombs.

Performance was led by ‘out of home’ advertising (e.g. billboards) company oOh!Media (+10.8%). oOh!Media has continued its recovery from depressed Covid levels and industry data suggests the outdoor category is tracking ahead of pre-Covid levels reflecting peoples’ improved mobility. While out of home advertising is not immune to a cyclical downturn, it should be more resilient. Integrated energy company Origin Energy (+10.4%) rallied following a revised takeover bid of $8.90 (down from $9) from the bidding consortium. While it is a small price cut to previous expectations, it was a positive step towards consummating the deal.

The stock is currently trading at a 10%discount to this price which we feel will narrow as regulatory uncertainties moderate. Seven Group (+8.0%) – the owner of multiple businesses including the Caterpillar dealership Westrac in Western Australia and New South Wales, Australia’s largest equipment hire business Coates Hire, Boral, and a stake in Beach Energy –delivered a strong earnings result.

The diversified conglomerate provides leverage to demand for domestic resources and the infrastructure capex cycle which we suspect will be a multi-year journey. Mining service provider Monadelphous (-13.7%) lagged following a delay in capex spend into FY24, while gold miner Silver Lake (-22.7%) disappointed after a weaker than expected half.

Performance Commentary - December 31, 2022

While 2022 was a weak year for Australian small cap equities, markets have generally held up well in the second half of the year. The Dynamic Small Companies Fund returned -2.6% for the month, ahead of the S&P/ASX Small Ordinaries which fell 3.7%.

We were pleased to pass our three-year performance anniversary for the Fund, having delivered a 24.5% cumulative return since inception in October 2019 against the benchmark return of 5.0%. The underlying Dynamic strategy, since inception more than nine years ago, has returned 10.7% p.a. against the benchmark return of 5.6% p.a. Gold was one of the few sectors which collectively made a positive contribution for the month. Evolution Mining (+10.8%), and Northern Star (+2.9%) were two portfolio companies that performed well reflecting heightened uncertainty from macro-economic and geopolitical pressures. While our gold exposure has been a source of frustration over 2022, we remain constructive in the near term as safe-haven demand builds.

Pharmaceutical distributor EBOS Group (+8.1%) continued its strong form . It has rallied over 20% for the quarter following its annual investor day and inclusion in the MSCI Mid Cap index which has driven technical buying. While we continue to like its strong position in the Australian pharmaceutical distribution industry, we have taken profits over the past few months. Smartpay’s (+7.5%) momentum continued following the release of its first half results last month which showed very strong revenue and earnings growth. Smartpay is a small terminal operator growing rapidly in a large addressable market. Laggards included independent investment platform Netwealth (-12.0%) and sleep apnoea global leader ResMed (-7.4%). We consider both high quality companies trading at reasonable valuations and able to grow earnings through the economic cycle. We remain conservatively positioned from a Fund perspective as we enter the new year. We believe the economy will likely slow at an increasing rate over 2023.

While the property market has responded quickly to the RBA’s monetary tightening, the impact on the broader economy will take longer. As this equity weakness continues, we will look to establish longer term buy and hold opportunities in quality businesses at attractive valuations. We have selectively started this process given our elevated cash position, however only in moderate size.

Performance Commentary - November 30, 2022

Global equity markets were buoyant in November, as risk sentiment improved on the back of softer inflation leading to the assumption of lower central bank interest rates. The Dynamic Small Companies Fund returned 3.2% for the month, behind the S&P/ASX Small Ordinaries which rallied 4.9%. The index was led by Small Resources which rocketed on prospects of China reopening. Performance was led by Origin Energy (+41.1%) following the bid from Brookfield Asset Management. The indicative proposal was attractive and represented a 55% premium to the last trading share price.

The stock is currently trading at a discount to this price, but we feel this should narrow in time as regulatory uncertainties moderate. SmartPay (+25.9%) was a notable performer following the release of its first half results which showed very strong revenue and earnings growth. SmartPay is a small terminal operator growing rapidly in a large addressable market. With competitor Tyro under takeover, we feel any market movements will create a significant opportunity for share gains from more nimble operators like SmartPay. Carsales (+12.4%) provided a positive trading update indicating it had already achieved the cost synergies from its recent acquisition, and that dealer acquisition was continuing.

Performance by the recently acquired Trader Interactive business was encouraging, with further revenue opportunities planned in 2023. We view Carsales as a relative defensive technology position. While many other technology companies have been beneficiaries of the Covid environment, it’s more nuanced for Carsales and the Covid hangover will be much more minimal.

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