Australian Emerging Companies Portfolio
DNR Capital Australian Emerging Companies Fund
The DNR Capital Australian Emerging Companies Fund is designed for investors seeking a medium-to-longer term investment focused on achieving growth, with less focus on generating excess income. The investor is prepared to accept higher volatility in pursuit of higher growth.
|Issuer and responsible entity||The Trust Company (RE Services) Limited as part of the Perpetual Limited group of companies|
|Investment manager||DNR Capital Pty Ltd|
|Investment bias||Style neutral with a quality focus|
|Designed for||Investors seeking a medium-to-longer term investment focused on achieving growth, with less focus on generating excess income. The investor is prepared to accept higher volatility in pursuit of higher growth.|
|Investment objective||The Fund’s investment objective is to invest in a portfolio of Australian emerging companies that aims to outperform the Benchmark (net of fees) over a rolling five -year period. The investment objective is not a forecast of the Fund’s performance.|
|Benchmark||S&P/ASX Small Ordinaries Accumulation Index|
|Investments||Australian equities and cash|
|Investment constraints||The Fund will not invest in derivatives.|
|Investment guidelines||Maximum exposure to an individual security is 15% of Fund NAV.
Minimum exposure of 60% of the Fund NAV to be invested in the S&P/ASX Small Ordinaries.
|Asset allocation||Australian equities – 80-100%
Cash – 0-20%
|Number of securities held in the Fund||Min 20 – Max 45|
|Minimum suggested investment timeframe||5 years|
|Buy/sell spread||+0.30% / - 0.30%|
|Management fee||1.15% p.a. (inclusive of GST and RITC)|
|Performance fee||20% on outperformance of the Fund's benchmark|
|Minimum investment amount||$20,000|
|Minimum additional investment amount||$5,000|
|Minimum withdrawal amount||$5,000|
|Valuation and unit pricing frequency||Each business day|
|Application frequency||Each business day|
|Withdrawal frequency||Each business day|
|Distribution payment method||Direct deposit or reinvestment|
DNR Capital believes a focus on quality will enhance returns when combined with a thorough valuation overlay. It seeks to identify good quality emerging businesses that are mispriced by overlaying DNR Capital’s quality filter, referred to as the ‘quality web’, with a strong valuation discipline.
The DNR Capital Australian Emerging Companies Fund has an investment style best described as ‘style neutral’. The security selection process has a strong bottom-up discipline and focuses on buying quality emerging businesses at reasonable prices. The process involves comprehensive company and industry research, company visits and meetings, and detailed valuation analysis and modelling. This information is used to assess the quality of a business, and the expected return.
We define quality businesses as being those with the following five attributes:
- earnings strength (particularly improving return)
- superior industry position
- a sound balance sheet
- strong management
- low environmental, social and governance (ESG) risk
Where the security passes this quality assessment then a range of valuation methodologies are used to identify value having regard for the industry and circumstances of the business.
DNR Capital seeks to invest in businesses which offer upside to the target valuation in excess of its market forecast and sit within a defined portfolio construction framework.
Having identified securities with attractive quality and value characteristics, consideration is given to risk characteristics such as the security and sector correlations of investments.
The portfolio construction process is also influenced by a top-down economic appraisal. A range of economic indicators are reviewed regularly and these measures are used to formulate an economic overview which provides a backdrop to investment decision making and influences portfolio construction.
Investments held in the Fund are formally reviewed by the investment committee which meets monthly and is responsible for reviewing Fund performance, Fund constituents, the economic overview and internally generated reports.
While the ultimate decision rests with the investment team, the investment committee provides a mechanism of accountability.
The investment strategy of the Fund is intended to result in a concentrated portfolio that is high conviction and invests for the medium to long-term.
For more information on the DNR Capital Australian Emerging Companies Fund, please contact us on email@example.com or refer to our monthly report below:
Click here to download the DNR Capital Australian Emerging Companies Fund monthly report.
|The information in this website relating to the Fund has been prepared by DNR Capital Pty Ltd, AFS Representative - 294844 of DNR AFSL Pty Ltd ABN 39 118 946 400, AFSL 301658. It is general information only and is not intended to be a recommendation to invest in any product or financial service mentioned above. Whilst DNR Capital has used its best endeavours to ensure the information within this document is accurate it cannot be relied upon in any way and you must make your own enquiries concerning the accuracy of the information within. The information in this document has been prepared for general purposes and does not take into account the investment objectives, financial situation or needs of any particular person nor does the information constitute investment advice. Before making any financial investment decisions you should obtain legal and taxation advice appropriate to your particular needs. Investment in the Fund can only be made on completion of all the required documentation. The Trust Company (RE Services) Limited ABN 45 003 278 831 AFSL No 235150 (as part of the Perpetual Limited group of companies) is the issuer of the PDS for the Fund. An investor should obtain and read the PDS and consider their circumstances before making any investment decision. The PDS is available at the Fund website at dnrcapital.com.au/invest, or a paper copy can be obtained, free of charge, upon request by calling DNR Capital Pty Ltd ("Manager"), the investment manager of the Fund. This material is general information only and not an investment recommendation. The Manager or The Trust Company (RE Services) Limited does not guarantee of the repayment of capital from the Fund or the investment performance of the Fund.|