PAN-Tribal Asset Management, which distributes the Barwon Global Listed Private Equity Fund – AF, has advised that Zenith Investment Partners has reaffirmed the Fund’s Recommended rating.
According to its report, Zenith’s believes “…the Fund offers a differentiated exposure, with Barwon’s ability to capture a private market premium across a mix of standalone companies and listed funds deemed a key competitive advantage.”
Further, the report states: “In Zenith’s opinion, Barwon’s ability to identify mispricing opportunities across a heterogeneous universe is a key competitive advantage. In particular, the ability to model the intrinsic value of underlying portfolio assets/companies relative to the listed trading price, whilst also understanding the PE value creation cycle (i.e. vintage management, collection of performance fees) allows it to rotate capital across different parts of the PE sector (i.e. PE Sponsors, standalone companies and listed funds).”
When it comes to the portfolio construction, the report said: “Zenith is supportive of Barwon’s approach to portfolio construction, noting its ability to invest across a wide spectrum of securities, including actual PE managers, listed funds trading at deep discounts and listed companies that are controlled by PE sponsors. In our opinion, the breadth of the opportunity set promotes a high level of vintage diversification, which is expected to contribute to smooth risk-adjusted returns over the medium term.”
Finally, in commenting on the Barwon team, Zenith says: “The Sydney-based listed private equity team comprises eight investment professionals and is led by Sam Armstrong, Head of Private Equity. Zenith considers Armstrong to be a high-quality private equity specialist. The Lead Portfolio Manager for the Fund is Bob Liu, who is supported by the investment team. Zenith holds Liu in a high regard, reflecting his strength in bottom-up research.”
The Fund is categorised in Zenith’s ‘Alternatives – Private Equity’ sub-sector, which consists of managers that invest in unlisted or private companies to achieve high returns, typically exceeding those available in public listed markets. Zenith describes a key differentiating aspect of private equity investing to be the relationship between the private equity manager and the company, which typically involves board representation and collaboration on a number of strategic initiatives to grow revenues and ultimately profitability.
Zenith believes that the Fund may be used to complement and diversify an Alternatives portfolio, particularly where daily liquidity is prioritised. The research house views the Fund as a growth investment and should be funded from an investor’s growth allocation, noting it has historically exhibited a high correlation with listed equities.
The Barwon Global Listed Private Equity Fund – AF is currently available across nine leading platforms. The Fund provides investors with daily liquidity, making it an ideal candidate for inclusion into managed accounts and model portfolios.