Affluence Investment Fund

Affluence Investment Fund Update – May 2017

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To view the full Affluence Investment Fund Update – May 2017 in pdf format, click here.

The ASX200 fell by 2.8% in May as the “sell in May” pattern once again played out this year. The Affluence Investment Fund managed a very small gain of 0.1% for the month, continuing the pattern of being resilient in tough markets.

Since commencing in December 2014 the Fund has returned 9.5% per annum. Over that period the Fund has outperformed both our benchmark (inflation plus 5%) and the ASX 200 (including dividends) of 7.7% per annum.

The strongest investment for the Fund during May was the Bronte Capital Amalthea Fund, which was up over 7% for the month. This is a good example of being patient with a quality manager. For the 11 months to November 2016, the Bronte fund was down around 7%, during a very difficult period for the long/short investment style employed by Bronte. In the 6 months since then, it has delivered returns of over 20%.

Other investments to produce positive returns in May included the Baker Steel Gold Fund (+3.1%), India Avenue Equity Fund (+2.6%), Deep Value Microcap (+2.4%) and Wentworth Williamson (+1.8%). Negative contributors were the Phoenix Opportunities Fund (down 2.8% after a very successful 12 months) and the Terra Capital Natural Resources Fund, which was down 4% for the month.

Once again, we topped up several existing investments this month. We also added the Packer Investigator Trust to the portfolio for the first time. This manager was founded in 1993 by Willy Packer and is based in Perth.  The Fund commenced in 1996 and has $1.5 billion of assets. The manager has a very open mandate to allocate funds across a broad spectrum of asset classes including Australian and global shares, derivatives, bonds, cash and other unit trusts, with very few investment limits. The Packer Investigator Trust has a quite exceptional performance record, having delivered returns of over 13%p.a. for the past 20 years, with just one negative year in that time.

Looking forward, valuations for almost all assets remain relatively high. Having said that, we are not yet seeing signs of the sort of exuberance that quite often precedes cyclical highs, meaning markets could easily move higher before any correction unfolds. We continue to focus our efforts on making the Fund’s portfolio as resilient as possible for a wide range of eventualities.

At month end, 61% of the Fund was investment in unlisted investments, 20% in the Affluence LIC Fund, 6% in other listed investments, and 13% in cash. If you’d like further details of the investment portfolio, just email us and we’ll provide it to you. If you’re registered on our website as an Affluence Member, you can login and follow the link to the Members Area to view the portfolio.

If you would like to invest with us and get access to a diverse range of Australia’s best fund managers, including over 25 unlisted funds as well as more than 20 LIC’s and other listed entities, visit the fund page on our website at to find out more.  There, you can get information on the Fund, apply online or download the application pack. If you’d like to add to your existing investment in the Fund, you can either complete the one-page form available on our website, or use the online facility.

The cut-off for this month’s applications is 23rd June. Units will be issued effective 1 July.

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