90 West reached $250M funds under management.

Specialist Australian natural resources investment management firm 90 West Asset Management (90 West) yesterday announced that funds under management (FUM) has exceeded $250 million for the first time. 90 West has two funds open to investors; the Global Natural Resources Fund (a long only fund) and the Global Basic Material Fund (a long-short fund).

Clive Landale, Managing Director, 90 West, said the funds are performing strongly and attracting strong interest from family offices, retail and wholesale markets.

“Our core belief is that a global investment approach focused on high quality mining, energy and agricultural assets, combined with specialist natural resources investment and industry expertise, is the key to superior long-term investment returns in the natural resources sector. This single-minded approach has appealed to our investors and we are witnessing robust interest in the funds. At the wholesale end, we are seeing growing interest in global sector specialists.”

“The Global Natural Resources Fund is attracting interest from retail and wholesale markets. We received a favourable rating from van Eyk earlier this year, which has helped in making this fund more accessible on platforms. We are working to extend this availability and hope to have further announcements in this regard in the coming months. Our association with Henderson Global Investors has also been positively viewed by the market.”

In April 2013, Henderson Global Investors took a 33 percent stake in 90 West Asset Management. The two businesses are working closely together to increase the distribution of their respective businesses and tap into new local and offshore markets.

David Whitten, Executive Chairman and portfolio manager, said exceptional opportunities are still to be found in global natural resources.

“We are pleased with the outcome from our global investment approach that focuses on quality natural resource companies across agriculture, energy and mining. This growing asset class makes up approximately 24 percent of the globe’s total listed equities. The continued and immense population growth of emerging economies and their desire for better living conditions, will drive growth in a range of resource sectors over the next 30 years.”

Mr Whitten said investors have shown a keen interest in the Global Natural Resources Fund and that the Fund was delivering well above benchmark returns.

“We are very pleased with the performance of the Fund. The annualised 16.12% net return from inception (July 2012) to the end of September 2013 was 3.87% p.a. above benchmark.”

The 90 West Global Natural Resources Fund seeks to achieve long-term capital appreciation by investing in a

portfolio of global natural resource companies operating in the mining, energy and agriculture natural resource

sectors and across the upstream, midstream and downstream segments of the natural resources utilisation

chain.

The post 90 West Asset Management passes $250M FUM Milestone appeared first on AdviserVoice.

The post 90 West Appoints New Senior Investment Analyst appeared first on AdviserVoice.

David Whitten, Executive Chairman and the prime portfolio manager, said the developments came at an important time as investors gain confidence in equity markets, with global natural resources among the most attractive opportunities.

“After falling through most of 2011 and the initial five months of 2012, we have seen a very strong recovery in global natural resource equities. Since bottoming at the end of May 2012, the S&P Global Natural Resources Index has risen by 20.5 per cent in USD (+12.1% in AUD).  The Agricultural Sector has led the way, rising more than 25 per cent  (+16.7% in AUD), followed by Energy up 19.3 per cent (+11% in AUD) and Mining up 12.7 per cent (+4.8% in AUD).

“Our modest one per cent cash position at quarter end 2012, reflects the attractive investment opportunity set and the favorable longer-term positive outlook for the global natural resource equity sector.   Although 90 West does not predict short-term natural resource market or commodity price movements, we currently see attractive natural resource valuations combined with a supportive long-term macro environment for many global natural resources companies,” Mr Whitten said.

“In our view, some of the strongest opportunities will result from cheaper energy prices in the US, a rebound in US housing – leading to improved demand for timber; and gold, as we see high gold prices but relatively low valuation of gold companies.”

Clive Landale, Managing Director, 90 West, said the developments would help ensure the funds are available to a greater number of financial advisers and their clients.

“The favourable van Eyk rating of the 90 West Global Natural Resources Fund is testament to the experience of our portfolio manager David Whitten combined with the strength of the wider team.  This rating will help make the Fund more accessible to the many dealer groups and advisers, who want to capture the investment potential this sector offers.

Additionally, Mr Landale said both the Global Natural Resources Fund (a long-only fund) and the Global Basic Materials Fund (long-short) would now also be available via the Linear Asset Management investment platform.

“Previously, the Global Basic Materials Fund was only available to wholesale investors, with a minimum investment of $100,000.  However, both funds will now be available to smaller investors via Linear, with a minimum investment set at $10,000.”

CEO of Linear Asset Management, Chris Hipkin, said the funds had been included on the platform in expectation of growing investor demand for specialist resources managers.

“Recent reports from the US show a turn around in inflows into equity funds, with $22 billion invested into equity funds in the week ending 9 January 2013.  This was the second highest inflows for any week since 1996*.  These results have been repeated in following weeks.  We believe this positive sentiment will lead to stronger markets globally, which will have a flow on effect to sentiment and markets in Australia.  We know that natural resources offer very favourable investment characteristics and therefore are including these funds in anticipation of growing investor demand.”

The post 90 West Asset Management receives accessibility boost appeared first on AdviserVoice.

It also said that persistent fears that a slowdown in China and other markets will adversely affect global resources markets are overplayed. Executive Chairman and portfolio manager David Whitten said that the current market represents one of the better investment opportunities he has witnessed in more than 30 years of global resources investing.

90 West also announced this month the launch of the 90 West Global Natural Resources Fund, to allow individual investors to profit from this opportunity.

“Many people might be questioning why we are launching this fund in a depressed market.  Quite simply, the China and emerging markets story, combined with constrained supply in vital areas, cannot be overstated in terms of its importance on the demand supply balance for resources,” Mr Whitten said.

“The world’s largest populations of China, India and Brazil are still at an early stage of unprecedented economic growth.  Even with relatively modest rises in GDP per capita, these populous countries will continue to have a huge long-term impact on natural resources demand, in particular minerals, energy and food.

“At 90 West, we think this is one of the better opportunities from an investment perspective that we have seen in our combined 60+ years of investment experience.”

Mr Whitten said softer markets mean that shares in quality companies are available at very reasonable prices.

“We have managed money through several similar, and in some cases worse, market conditions. These times present a great opportunity to buy quality companies at attractive prices.”

“The S&P Global natural resources index has fallen 15 percent in past year, but the fundamentals are still sound.  Many company balance sheets were stretched around the peak of the market in 2007, but these have been repaired in last few years and a new level of conservatism is in place. In the companies we consider for investment, valuations are attractive and earnings, sound.  We believe that this creates an excellent opportunity for the skilled investor.”

Mr Whitten said some companies finding it difficult to obtain debt and raise equity, which was leading to a delay in projects. However, this is not necessarily a negative for investors.

“In a bear market, excess returns can be easier to find as there is less competition for good ideas. We also see delays in projects as a positive for markets, as a decrease in supply creates discipline and this can mean that the resources cycle could last longer than anticipated.”

Mr Whitten said that investors needed to take a global view if they are to diversify risk and capture full upsidepotential.

“Despite the fact there are around 1,000 Australian natural resource companies, Australian companies comprise only about five percent of total listed worldwide natural resource stocks by market capitalization.  As such, they represent limited exposure to the natural resources sector.”

Mr Whitten said the Australian resources sector was also highly concentrated, with BHP and Rio Tinto representing a combined market capitalisation in excess of 56 percent of the Australian listed natural resource company sector[1].

“For other natural resource sectors such as listed energy and agribusiness companies, the Australian listed segment is modest relative to global stock market opportunities. By market capitalisation, Australia’s energy and agribusiness sectors are individually and combined, less than two percent of the global energy and agribusiness sectors.”

[1] Bloomberg GICS classification & 90 West global natural resources universe

26 July 2012

The post Veteran global resources manager says tough market conditions creating better investment opportunities appeared first on AdviserVoice.