ATLAS Infrastructure Australian Feeder Unhedged aims to provide investors with exposure to a selection of high quality infrastructure equities. The portfolio will be invested in OECD countries only and is a high conviction strategy focussed on investing in infrastructure securities which provide the optimal balance of return and risk. The fund aims to monitor and manage carbon and climate change risk exposures within set tolerances. The investment strategy of the Fund is to invest in the Underlying Fund which will invest in a moderately diversified portfolio of global infrastructure equity securities listed on stock exchanges in developed nations. The portfolio of equities will be issued by, or provide exposure to, global companies that own or operate under concession, high quality essential infrastructure assets in various sectors, including electric, gas and water utilities, transport, communications and community and social infrastructure. Portfolio companies will be selected from those that ATLAS UK considers to offer the best potential for a combination of capital appreciation and income over the medium to longer term whilst minimising risk of loss to investors.
The portfolio returned -5.46% (net of fees) in September versus the benchmark return of 0.67%. The total contribution to local returns from our equity holdings was -5.33%. The main contributor in the period was our holding in Fraport. The main detractors were Edison International, SES and Orsted.
What is ATLAS Infrastructure Aust Fdr Fd – Hdg ATLAS Infrastructure Aust Fdr Fd – Hdg is an Managed Funds investment product that is benchmarked against Global Infrastructure Index and sits inside the Property - Global Listed Infrastructure 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 ATLAS Infrastructure Aust Fdr Fd – Hdg has Assets Under Management of 0.00 M with a management fee of 1.2%, a performance fee of 0.00% and a buy/sell spread fee of 0%.
How has the investment product performed recently? The recent investment performance of the investment product shows that the ATLAS Infrastructure Aust Fdr Fd – Hdg has returned 2.26% in the last month. The previous three years have returned 6.56% annualised and 13.73% each year since inception, which is when the ATLAS Infrastructure Aust Fdr Fd – Hdg 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 ATLAS Infrastructure Aust Fdr Fd – Hdg first started, the Sharpe ratio is NA with an annualised volatility of 13.73%. The maximum drawdown of the investment product in the last 12 months is -4.55% and -20.74% 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 ATLAS Infrastructure Aust Fdr Fd – Hdg has a 12-month excess return when compared to the Property - Global Listed Infrastructure Index of -2.44% and 2.24% 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. ATLAS Infrastructure Aust Fdr Fd – Hdg has produced Alpha over the Property - Global Listed Infrastructure 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 Property - Global Listed Infrastructure Index category, you can click here for the Peer Investment Report.
What level of diversification will ATLAS Infrastructure Aust Fdr Fd – Hdg provide? ATLAS Infrastructure Aust Fdr Fd – Hdg has a correlation coefficient of 0.94 and a beta of 1.09 when compared to the Property - Global Listed Infrastructure 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 ATLAS Infrastructure Aust Fdr Fd – Hdg and its peer investments, you can click here for the Peer Investment Report.
How do I compare the ATLAS Infrastructure Aust Fdr Fd – Hdg with the Global Infrastructure Index? For a full quantitative report on ATLAS Infrastructure Aust Fdr Fd – Hdg compared to the Global Infrastructure Index, you can click here.
Can I sort and compare the ATLAS Infrastructure Aust Fdr Fd – Hdg to do my own analysis? To sort and compare the ATLAS Infrastructure Aust Fdr Fd – Hdg financial metrics, please refer to the table above.
Has the ATLAS Infrastructure Aust Fdr Fd – Hdg 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 ATLAS Infrastructure Aust Fdr Fd – Hdg? If you or your self managed super fund would like to invest in the ATLAS Infrastructure Aust Fdr Fd – Hdg please contact Level 8, 9 Hunter Street, Sydney 2000 via phone +61 2 8318 7639 or via email
How do I get in contact with the ATLAS Infrastructure Aust Fdr Fd – Hdg? If you would like to get in contact with the ATLAS Infrastructure Aust Fdr Fd – Hdg manager, please call +61 2 8318 7639.
Comments from SMSF Mates SMSF Mate does not receive commissions or kickbacks from the ATLAS Infrastructure Aust Fdr Fd – Hdg. All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - August 31, 2023 In Australian dollar terms, the hedged portfolio fell 3.84% (net of fees) over the month of August, while the unhedged portfolio fell 1.00% (net of fees).
The largest contributions to the absolute portfolio return came from SES (+1.1%), Fraport (+0.2%) and Elia (+0.1%). The main detractors were United Utilities (-0.4%), Norfolk Southern (-0.6%) and Orsted (-1.5%).
On a relative basis, the portfolio’s overweight to Europe (74% portfolio versus 18% benchmark) was positive to returns (+1.51%), and the lower allocation to the North American sector (24% portfolio versus 65% benchmark) also had a positive impact (+0.33%).
The portfolio benefited from its overweight position in European Electric Utilities (+0.3%), however the exposure to European Renewables (-1.24%) detracted from returns, as did the underweight position in US Pipelines & Storage (-0.46%). Stock selection in both markets was negative overall, with Norfolk Southern (US Railways) underperforming its sector average, which was slightly offset by holding in SES (European Communication), Fraport (European Airports) and Terna (EU Electric).
On a company level we would note the following key developments:
– SES (European satellites) reported its Q2 result in early August, confirming its 2023 earnings outlook, as well as announcing a €150m buyback program to be executed over the coming 12 months, to which the market responded positively. Later in the month the Federal Communications Commission validated that SES had completed all necessary work to clear the C-band spectrum, clearing the way for the final payments to be made later this year. Although the buyback represented only a small part of the potential C band proceeds (US$3bn), we view the announcement as a very positive signal of priorities from the new management team.
– Late in the month Orsted (European renewables) announced that it had anticipated impairments in its US offshore wind business due to supply-chain issues, as well as expectations around tax credits and interest rates, with total impairments potentially as high as DKK 16bn (USD 2.3bn). Despite Orsted not yet at Final Investment Decision for many of its US offshore projects, the impairments would be taken against the assets Orsted has already built up in anticipation, including supply-chain and operational assets. Given the timing of the announcement, so close to Q2 results earlier in the month, as well as the ongoing issues in the offshore space globally the market was taken completely by surprise and responded negatively as a result. From an ATLAS perspective, we saw the only material incremental negative as being the reduction in the expected ITC credit – given the company had already guided capex higher and we had already included higher interest rates in our base case.
– Fraport (European airport) reported its Q2 results which showed traffic at Frankfurt airport recovering to ~82% of 2019 levels, and Asia-Pacific traffic recovering strongly across the quarter, which should show up in numbers in the coming months. Following ongoing consultations with the airlines, Frankfurt also announced an expected tariff increase of 9.5% in 2024, which is on the back of a headline is a 4.5% increase in 2023. This makes Frankfurt one of the only European airports under ATLAS coverage to raise tariffs so substantially post Covid. This increase will offset the cost pressures and slower retail ramp-up that Frankfurt is seeing compared with peers.
Performance Commentary - July 31, 2023 In Australian dollar terms, the hedged portfolio rose 0.86% (net of fees) over the month of July, while the unhedged portfolio rose 0.41% (net of fees). The largest contributions to the absolute portfolio return came from SES (+0.7%), Enel (+0.4%) and Edison International (+0.4%). The main detractors were Terna (-0.1%), Aeroports de Paris (-0.2%) and Orsted (-0.4%).
On a relative basis, the portfolio’s overweight to Europe (68% portfolio versus 18% benchmark) was a detractor (-1.0%), and the lower allocation to the North American sector (29% portfolio versus 66% benchmark) also had negative impact (-0.3%). Offsetting the regional allocation, on a sector basis the portfolio benefited from a lack of exposure to US Communications (+0.3%) as well as an overweight to UK Water (+0.1%). Stock selection was positive overall, with the strongest performance in UK/Europe, particularly within the Communications (+0.7%) and Electric Utilities sectors (+0.4%).
Performance Commentary - June 30, 2023 In Australian dollar terms, the hedged portfolio rose 0.44% (net of fees) over the month of June, while the unhedged portfolio fell 0.51% (net of fees). The largest contributions to the absolute portfolio return came from Norfolk Southern Corporation (+0.4%), Enel (+0.4%) and Orsted (+0.3%). The main detractors were SES (-0.2%), Severn Trent (-0.2%) and Aeroports de Paris (-0.2%).
On a relative basis, the portfolio’s overweight to Europe (69% portfolio versus 18% benchmark) was negative to returns (-0.9%), and the lower allocation to the North American sector (27% portfolio versus 65% benchmark) also had a negative impact (-0.4%), although this was slightly offset by the lower allocation to Asia Pacific (+0.3%). The portfolio benefited from exposure to US Electric Utilities (+0.1%, driven by our holding in Edison International) and European Electric Utilities and Renewables (+0.5%, driven by our holding in Enel, E.ON and Orsted), offset against our positions in UK Water (-0.7%). Stock selection was relatively neutral, excluding Norfolk Southern Corporation which outperformed its sector average.
On a company level we would note the following key developments:
y Severn Trent / United Utilities (UK Water): The CEO of Thames Water (UK water – unlisted), Sarah Bentley, left the business at the end of June with immediate effect, which led to concerns over the financial viability of the company given its highly-leveraged balance sheet. There has been speculation of a nationalisation or further regulatory oversight to ensure the company remains financially viable. Despite the material difference in leverage and operational outcomes, the news led to share price declines from the listed UK water companies Severn Trent, United Utilities and Pennon.
y SES (European satellites): Announced in late June it has ceased merger talks with Intelsat. SES first disclosed talks about a possible combination with Intelsat in March. ATLAS notes that we had viewed this deal as potentially value creating in principle, but hard to execute with downside risks to SES shareholders in the short term. Given the complementary nature of the businesses, there would have been material capex savings from a combination of the businesses, and it would have assisted in reducing capacity over time. However, a combination of the top two largest commercial satellite companies would have faced substantial regulatory scrutiny and come at a sensitive time for the inclusion of SES in a ‘European’ IRIS consortium. With the end of talks we will continue with our engagement objectives to target a combination of share buybacks and dividend increase from the C-band proceeds. Earlier in the month, the company also announced that Steve Collar (CEO) would be stepping down at end of June, with Ruy Pinto, the Chief Technology Officer, assuming the interim CEO role until a permanent successor is named.
Performance Commentary - May 31, 2023 In Australian dollar terms, the hedged portfolio fell 3.24% over the month of May, while the unhedged portfolio fell 3.34% (net of fees).
The largest contributions to the absolute portfolio return came from Norfolk Southern Corporation (+0.1%) and Hera (+0.1%). The main detractors were Edison International (-0.6%), United Utilities Group (-0.5%*) and Enel (-0.4%).
On a relative basis, the portfolio’s overweight to Europe (73% portfolio versus 18% benchmark) was positive to returns (+1.35%), and the lower allocation to the North American sector (21% portfolio versus 65% benchmark) added 0.78%, this was slightly offset by the lower allocation to Asia Pac (-0.63%). The portfolio benefited from exposure to UK/Europe Electric Utilities (+0.3%, driven by our holding in Terna and Hera) and European Communications (+0.2%, driven by our holding in SES and Eutelsat), and from being underweight in US Electric (+0.4%) and US Pipelines & Storage (+0.4%). Stock selection was relatively neutral, excluding Norfolk Southern Corporation which outperformed its sector average.
Performance Commentary - April 30, 2023 In Australian dollar terms, the hedged portfolio rose 3.88% over the month of April, while the unhedged portfolio rose 6.43% (net of fees). The largest contributions to the absolute portfolio return came from Enel (+0.7%), Getlink (+0.5%) and Aeroports de Paris (+0.4%). The main detractor was Norfolk Southern Corporation (-0.2%). On a relative basis, the portfolio’s overweight to Europe (73% portfolio versus 18% benchmark) was positive to returns (+1.2%), and the lower allocation to the North American sector (21% portfolio versus 66% benchmark) added 0.5%, this was slightly offset by the lower allocation to Asia Pacific (-0.3%).
The portfolio benefited from exposure to UK/Europe Electric Utilities (+0.9%, driven by our holding in Enel), and from being underweight in US Communications (+0.3%). Stock selection was broadly positive across all sectors, excluding within European Communications and US Railways, with SES, Eutelsat and Norfolk Southern Corporation underperforming their sector averages.
Performance Commentary - March 31, 2023 In Australian dollar terms, the hedged portfolio rose 1.54% over the month of March, while the unhedged portfolio rose 4.04% (net of fees).
The largest contributions to the absolute portfolio return came from Edison International (+0.6%), E.ON (+0.5%) and Enel (+0.5%). The main detractors were Fraport (-0.5%), SES (-0.4%) and Norfolk Southern Corporation (-0.3%).
On a relative basis, the portfolio’s overweight to Europe (73% portfolio versus 18% benchmark) detracted -0.9% to returns, and the lower allocation to the North American sector (22% portfolio versus 66% benchmark) detracted -0.5%. The portfolio benefited from exposure to UK/Europe Electric Utilities (+0.5% due to our holdings in E.ON, Enel and Terna) and being underweight in Asia-Pacific Toll Roads (+0.2%), however, stock selection in European Airports and Communications was negative with Fraport and SES underperforming their sector averages.
Performance Commentary - February 28, 2023 In Australian dollar terms, the hedged portfolio fell 2.08% over the month of February, while the unhedged portfolio rose 0.55% (net of fees). The largest contributions to the absolute portfolio return came from Aena (+0.3%), Eiffage (+0.2%) and E.ON (+0.2%). The main detractors were SES (-0.9%), Norfolk Southern Corporation (-0.3%) and United Utilities Group (-0.3%). On a relative basis, the portfolio’s overweight to Europe (74% portfolio versus 17% benchmark) contributed 2.7% to returns, and the lower allocation to the North American sector (22% portfolio versus 66% benchmark) contributed 0.9%. The portfolio benefited from stock selection in North American Electric Utilities (+0.4% due to our holdings in Portland Electric and ALLETE) and underweight to North American Communications (+0.6%), which was more than offset by negative stock selection in European Communications (led by SES) and North American Railways (led by Norfolk Southern Corporation).
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