In his role, Warnes will focus on enhancing service delivery to PM Capital’s Asset Consultant and Private Wealth partners while managing relationships with major key accounts. His appointment reflects PM Capital’s commitment to delivering tailored, high-quality service that meets the evolving needs of clients.

“Ben’s deep industry knowledge and approach to client relationship management further demonstrates our commitment to providing outstanding support to our key accounts,” said Luke Cheetham, Director of Distribution. “His expertise will strengthen our ability to anticipate and meet the needs of our clients as it relates to global investing, while supporting our growth objectives.”

Warnes shared his enthusiasm for the new role, noting, “I am thrilled to join a business with a long-term track record of delivering for its clients. I am looking forward to working with this high performing team, building on our growth ambitions and continuing to deliver strong results for our clients.”

Warnes’ appointment underscores PM Capital’s focus on elevating client service and further expanding its reach within critical market segments.

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The PM Capital Global Companies Fund (‘Fund’) is now only one of two out of 28 investment products in its Zenith category to be rated ‘Highly Recommended’.

The rating upgrade equates to Zenith giving the Fund a score of greater than 80 out of 100 across a combination of factors including: investment team; portfolio management; product structure; and PM Capital as an organisation.

In its Review, Zenith says the Fund’s high conviction and contrarian investment approach is differentiated, and that Zenith continues to rate the PM Capital Global Companies Fund team highly.

Zenith concludes: “As a result, the Fund is one of Zenith’s preferred choices within the Zenith International Shares – Global Equities Long/ Short sector.

“Relative to Zenith’s assigned benchmark and the RBA Cash Rate, the Fund has materially outperformed since inception.”

Zenith also highlighted the Fund’s after-tax return potential: “Holding all else equal, the Fund may be more appealing to investors who are high marginal tax rate payers as it will result in superior after-tax return outcomes.”

The Fund’s Portfolio Manager, Paul Moore, said: “Zenith has a detailed approach to its research so to be rated ‘Highly Recommended’ is an honour.

“We provide opportunities significantly different to those provided by the index and more traditional benchmark-aware global equity funds.”

The Fund is available on all major platforms. The ASX-listed PM Capital Global Opportunities Fund (ASX:PGF) also uses the global equities strategy utilised by the Fund. 

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Jarod Dawson

Australian investors are leaving “a lot of opportunities on the table” by restricting themselves to domestic fixed income securities when they can least afford to, says Jarod Dawson, Portfolio Manager of the PM Capital Enhanced Yield Fund (EYF).

Mr Dawson said: “With official interest rates at a record low of 0.75% in Australia, investors more than ever need to look globally to access the best risk/ reward opportunities – ie to identify the true anomalies in global fixed income markets.

“If you don’t, you may be exposing yourself to more volatility and less return than you need to in what people typically think is a relatively safe sector.”

“Australia makes up such a small fraction of global fixed income markets that unless you’re investing capital globally, you’re really leaving a lot of opportunities on the table.”

Research house Zenith Investment Partners has just reiterated its “Recommended” rating on EYF, which targets a return in excess of the RBA’s official cash rate, with a regular income stream, and an emphasis on capital preservation and low volatility.

Mr Andrew Yap, Zenith’s Head of Multi-Asset and Australian Fixed Income, said of EYF: “Underpinning our conviction is our high regard for its long-standing portfolio manager that has the skills and experience to successfully manage the fund, with strong support provided by the broader PM Capital team, and their demonstrated track record of successfully navigating the fund through a range of market conditions, consistently delivering upon its performance objectives.”

Mr Dawson said: “We don’t think just getting a broad exposure to fixed income markets is effective. It’s really about picking the eyes out of what we think are the absolute best fixed interest investments around the world. And then when we find them, we put a meaningful amount of capital into them.”

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Paul Moore

PM Capital Global Opportunities Fund (ASX: PGF) and its subsidiary, PM Capital GO 2025 Limited (GO 2025) have jointly issued a Prospectus for the Offer of a next-generation Listed Investment Company (‘LIC’) security: ‘PTrackERS’, which stands for Portfolio Tracking Exchangeable Redeemable Securities (Converting Security).

A first of its kind innovation in the LIC space, PTrackERS have been developed to improve LIC investor outcomes and choice.

The Offer is made via a 1:1 Entitlement to PGF shareholders, plus a General and Broker Firm Offer. The Issue Price is $1.40 per PTrackERS, to raise a minimum of $105 million and a maximum of $491 million.

The Chairman of PGF and GO 2025, Andrew McGill, said: “GO 2025 is unique in the Australian market, combining the skills of an exceptional global equities investment manager, PM Capital, with a highly innovative offer structure that gives investors more control, choice and flexibility.

“PM Capital is in its 20th year of applying its global investing philosophy and process, and has one of the most deeply experienced global equities teams in Australia. In 2017, PM Capital’s global equities strategy applied to funds ranked first for performance in their peer group from 1 year all the way out to 9 years.

“PTrackERS provide access to the management experience of PM Capital, along with a significant benefit – the choice for sellers to redeem in the future based on NTA, thereby providing a redemption safety net if the securities are trading on market at a discount to NTA.

“This is a first of its kind benefit for investors in listed investment companies.

The Chief Investment Officer and Chairman of PM Capital, Paul Moore, said:

“Australians are citizens of the world. Given our outward focus and desire to experience the best the world can offer, it still surprises me that Australians keep such a large proportion of their assets in Australian equities rather than global equities.

“PM Capital GO 2025 provides an efficient and flexible way to take advantage of what we see as the best global opportunities to build wealth – with a long-term perspective.

“We believe our benchmark-unaware philosophy and process suits GO 2025’s aims and structure, allowing us to seek market anomalies that can provide attractive long-term returns.”

GO 2025’s Investment Strategy, and that of its parent PGF, is consistent with that of PM Capital’s unlisted managed investment scheme, the PM Capital Global Companies Fund and other associated global mandates. Across these funds and mandates PM Capital was ranked first in its peer group over 5, 6, 7, 8 and 9 years returns to 31 December 20171.

Since inception the PM Capital Global Companies Fund has doubled the annual returns of the MSCI World Net Total Return Index (AUD)2. PGF’s portfolio, also managed using a consistent global investment strategy, has generated a total return3 of 75% since inception. PM Capital was awarded the Money Management/Lonsec – 2018 Fund Manager of the Year – Equities (Long/ Short category).

GO 2025 is a step forward for LICs

‘GO 2025’ stands for ‘Global Opportunities’, reflecting its focus on global securities, and the year 2025, which is when its ASX-listed securities, the PTrackERS, provide holders the choice to either convert into PGF shares or redeem based on NTA.

The 7 year conversion/ redemption right reflects PM Capital’s recommended investment time frame of seven years plus across its global equities strategies.

It is the first time this type of security has been offer by an LIC.

Major factors which can negatively affect LIC investor returns:

• significant establishment costs resulting in day 1 investable assets being materially below the IPO price;
• even strongly performing LICs can trade away from their underlying net tangible asset (NTA) value, creating uncertainty for investors as to whether they can obtain the underlying value of their securities;
• growth in a LIC’s capital can lead to a dilution of NTA per share for existing holders making NTA performance vary from the investment manager’s performance;
• Locked-up capital creating low alignment between shareholders and the LIC investment manager, and
• Uncertain dividend policy.

PTrackERS by GO 2025 have been designed to address the above concerns. With PTrackERS:

• PM Capital is paying all Offer costs. On day 1, PTrackERS investable assets will equal the Issue Price (NTA will not include any soft intangible receivables from the investment manager. This is extremely rare with LICs);
• a selling holder has the choice of selling on market or redeeming based on NTA on 30 June 2025. This feature should also act as a catalyst for PTrackERS to trade closer to NTA;
• PTrackERS are non-dilutive to NTA before tax plus franking credits for both PGF and GO2025;
• other LICs lock-up capital, whereas PTrackERS gives investors the choice in 7-years’ time to redeem or stay. This makes the investment manager truly aligned and accountable for investment performance and communication, and
• a clear dividend policy that intends to target a distribution yield of between 3% and 4% per annum.

With PTrackERS the benefits of traditional LICs outlined below remain:

• PTrackERS will be traded on the ASX (Code: P25PA) consistent with shares of LICs;
• the Investment Manager can, due to the seven year time frame, genuinely invest for the long term without the distraction of daily capital flows, and
• dividends can be franked where franking credits are available.

Higher levels of alignment between investors and the Investment Manager

PM Capital is strongly aligned to the GO 2025 and PGF investment strategy:

• The Investment Manager, PM Capital, and its staff are, in aggregate, the largest holders in GO 2025’s parent, PGF, with a co-investment representing approximately 8.9% of PGF’s issued capital (amounting to an investment of over $40 million);
• If the Offer is fully subscribed, PM Capital will be required to pay approximately $15 million in fees and costs on behalf of the Issuers; and
• If investors do not believe they have had a good investment experience, they can redeem PTrackERS on 30 June 2025, and in doing so remove a source of PM Capital’s management fees revenue.

Broker Syndicate

Morgans Financial Limited is the Lead Arranger and Joint Lead Manager to the Offer. Morgan Stanley Australia Securities Limited and Ord Minnett Limited are the other Joint Lead Managers.

The Co-Managers to the Offer include Baillieu Holst Limited, Bell Potter Securities Limited, Kimber Capital Pty Ltd, Patersons Securities Limited, and Shaw and Partners Limited.

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“We’re delighted he has come on board given his wide knowledge, particularly in the technology and communications space. He will add significant expertise in detecting investment anomalies around the world.”

Mr Huey was most recently an Investment Analyst at Platinum Asset Management, a role he held for over 21 years. He covered Asia from 1996-2000, the technology sector globally from 2000-2014, and South East Asia, Korea and Taiwan from 2014 to the present.

Initially, Mr Huey will be concentrating on the information technology, communications services and healthcare sectors for PM Capital.

Mr Moore said: “As a senior member of the investment team, in addition to his sector focus, Doug will contribute broadly across our investment and peer review process.”

Mr Huey said: “PM Capital finds long term anomalies using deep research, then invests with high conviction. This philosophy and process provides the best opportunity the best chance of delivering strong investment returns.

“PM Capital has one of a handful of global funds in Australia that can claim to have navigated long term market cycles. Market experience and instinct matter going forward.”

PM Capital has been managing global equities since 1998.

As at 31 December 2017, PM Capital-managed global mandates ranked first for performance in their Morningstar global equities peer group over 5, 6, 7, 8 and 9 years.*

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Kevin Bertoli

The PM Capital Asian Companies Fund (‘Fund’) is now available on Netwealth platforms, giving more investors the opportunity to take advantage of a differentiated approach to the world’s fastest-growing region.

The Netwealth inclusion coincides with the Fund achieving compound investment performance of 16.6% per annum since inception, beating the relevant industry benchmark by 7.6% per annum.*

Portfolio Manager of the Fund, Kevin Bertoli, said: “It’s time to pay particular attention to Asia. It will be the epicenter of global growth over the next decade.

“The quality of the opportunity subset has improved considerably. It’s no longer just low commodity industries and companies, nor is it a China-only play.

“You can no longer view Australia as a proxy for Asia. As the Asian region shifts from capital and resource intensive fixed asset development toward a consumer driven economy, owning Australian mining companies as a proxy for Asia is not going to give you exposure to this evolution.

“The changing economic structure in Asia requires investors to rethink their approach. A hand-picked portfolio of securities is required, centred on genuine long term opportunities.”

“The Fund gives unrestricted exposure to the world’s fastest growing region. It’s highly focused, holding 15 – 35 stocks, rather than being built around index or country exposures. Instead, we build the portfolio based on our fundamental, bottom-up investment process.”

The PM Capital Asian Companies Fund has been added to Netwealth’s Wrap and Super public menu, joining the PM Capital Global Equities, Enhanced Yield and Australian Companies Funds. It is already available on platforms including CFS FirstWrap, Macquarie Wrap and Hub24.

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Paul Moore

PM Capital has been awarded a new global equities mandate by Alpha Fund Managers.

Alpha has cited PM Capital’s Global Companies Fund’s “long term track record and high conviction approach” when awarding the mandate.

PM Capital has been appointed to provide investment expertise to Alpha’s diversified ‘fund of fund’ international equities strategy.

William Wang, Head of Funds Management at Alpha Fund Managers, said: “We found PM Capital’s high conviction, concentrated style and long term track record particularly attractive.

“Its ability to successfully and consistently add value over the long term fits well with our belief that benchmark unaware investment managers can generate above market returns over the medium to long-term.

“PM Capital’s style characterised by exploiting anomalies in the market also blends well with our other mandated managers.”

Paul Moore, Portfolio Manager of the Fund, said: “We see an alignment of philosophies with Alpha, particularly given its commitment to long term investment.

“We are looking forward to providing Alpha’s clients with the benefits we can derive from finding and exploiting market anomalies around the world.”

PM Capital has a Global Equity strategy ranked number one for performance by Morningstar in its peer group over 1,3,5,7 and 8 years.* The PM Capital Global Equities Fund has produced annualised returns 4.6% above the relevant benchmark since inception.**

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Mr Noone will be responsible for sales in Queensland across PM Capital’s suite of funds. He brings more than 20 years’ experience in client relationship management across investments, advice and platforms.

James was previously Head of Sales and Marketing at Financial Advice Matters (FAM) and also sat on its Investment Committee. This followed roles at Colonial, Aviva and TAL.

Ben Skilbeck, PM Capital’s Chief Executive Officer, said: “James brings real depth of experience and understanding, and is well known in the Queensland market. His appointment highlights the importance PM Capital places on assisting Queensland-based financial advisors and investors.

“The appointment follows Rebecca Morgan joining PM Capital as our Melbourne-based Sales Director in February. These appointments indicate our confidence in the role we can play in improving investor outcomes through our patient and insightful investment approach.”

Mr Noone said: “My appointment shows the commitment PM Capital has towards the Queensland market. PM Capital’s investment process is tried and tested over the last eighteen years, building long term wealth alongside its co-investors.”

PM Capital has a Global Equities strategy ranked #1 for performance by Morningstar in its peer group over 1, 3, 5, 7 and 8 years*. The Asian Companies Fund’s performance was ranked first in its peer group since the date of its inception. The Australian Companies Fund was ranked number one and the Enhanced Yield Fund number two in their sectors over one year.

——-

*Source: Morningstar Direct. As at 30/6/17, PM Capital’s Global Companies Fund ranked #1 in its Morningstar Australian Open-Ended Equity World Large Blend peer group of 214 over 1 year.

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Paul Moore

The PM Capital Australian Companies Fund (‘Fund’) is now available on Netwealth platforms, giving its investors an innovative way to access the Australian equities market.

The Netwealth inclusion coincides with the Fund achieving an investment performance ranked number one out of 318 products in its sector for the year to 30 June 2017*.

The Fund joins the other PM Capital products in providing investors with market-leading returns. Funds and/or mandates using PM Capital’s Global Equities investment strategy were not only ranked first among the peer group funds for the 1 year to June 2017, but also ranked number one over 3, 5, 7 and 8 years. The Asian Companies Fund’s performance was ranked first in its peer group since the date of its inception and the Enhanced Yield Fund was ranked number 2 in its sector for the year.

Portfolio Manager of the Australian Companies Fund, Uday Cheruvu, said: “We use a handpicked portfolio of 15-25 companies to create long term wealth. The Fund gives access to a unique portfolio of Australian equities with the ability to also obtain a small proportion of global exposure powered by domestic and international market insights. This means that the Fund provides opportunities in the Australian market significantly different to those provided by the index and more traditional benchmark aware Australian equity funds.”

The Australian Companies Fund has been added to Netwealth’s Wrap and Super public menu, joining the PM Capital Global Equities and Enhanced Yield Funds. It is already available on platforms including Macquarie Wrap and BT Wrap.

Founder and Chairman, Paul Moore, said: “Performance has been strong across the entire PM Capital product suite, including the Australian Companies Fund. I hope these kinds of results are seen as testament to our investment philosophy and process that we have and always will employ, irrespective of market circumstances.”

Since its inception, the Australian Companies Fund has produced total returns of 513.6%, compared with 282.6% for the benchmark S&P/ ASX 200 Accumulation Index. This has meant that $20,000 invested in the Fund at inception has now grown to $122,717 (end June), versus $76,519 if held in an index fund.

Mr. Cheruvu said: “The Australian equities market is highly concentrated, with more than half of the benchmark S&P/ ASX200 Accumulation Index in banks and resource-related companies. This makes it extremely difficult for managers to add value over the long term when they have to hold stocks that they may not like in order to remain close to the index.

“However, for us, if we don’t like a stock, we don’t invest in it. Our exposure to sectors and stocks is determined solely by our conviction in the risk/ reward opportunities that we identify within portfolio guidelines.”

PM Capital’s flagship product, the Global Companies Fund, has produced annualised returns 4.7% above the relevant benchmark since inception.

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Paul MoorePaul Moore

A new survey by PM Capital shows investors struggle to take a long-term approach to meet their expectations, while also having a very optimistic view towards global equity markets.

PM Capital has surveyed 214 financial advisers at a series of investment forums events in Sydney, Melbourne, Brisbane, Adelaide and Perth, representing thousands of end investors.

According to the survey, only 15% of financial advisers say their typical client considers a long-term investment horizon to be over 10 years, while nearly two thirds (64%) cite five to 10 years as the time frame horizon for long-term goals.

At the same time, more than 60% of respondents think global equity markets will be 10-20% higher two years from now.

Australians are one of the longest living populations in the world with average age expectancy currently 80.9 years for men and 84.8 for women, according to the World Health Organisation.

PM Capital’s founder and Chief Investment Officer, Paul Moore, said investors’ relatively optimistic near term expectations combined with investment horizons that may be inconsistent with life expectancy in retirement, risked resulting in unfulfilled financial goals.

Mr Moore said: “Equity markets in general have delivered strong investment returns over the past five to eight years. Passive investing has produced adequate returns over this period and investors are betting this will continue. However, with the secular reduction in interest rates in developed markets over the past 30 years coming to an end, we think select stock picking is going to be more important than ever to generate acceptable returns.

“Australians need multi-decade funding to have a financially secure retirement. Their objectives are most likely going to be achieved by extending their investment horizon and finding a means to invest in a selectively picked portfolio of companies likely to deliver strong earnings growth. With this mindset, investors are able to look pass any short-term price fluctuations on their path to retirement goals.

“Passive investing is not going to do the job. Passive asset allocation – a combination of cash, bonds and property – is going to give investors future returns of 2% to 3% at best. Passive investment in equities may give you 4% to 6%. Once fees and the net return are taken away from passive investment in a typical blend of major asset classes, the return is likely to be 3% or 4% – not enough for retirees to meet their objectives. That’s why we believe investors need credible, high-conviction fund managers.

“Investors need to look away from the crowd, to do something different, to search for market anomalies, to improve the likely returns from equities over the long term,” Mr Moore said.

With the aim to build long term wealth, PM Capital manages both equity and fixed income portfolios by using a focused, patient and considered approach to find simple investment ideas. The recommended investment period for its equity funds is 7+ years.

The survey also found that more than 75% of investor clients are not looking to change their asset allocation.

As at September 2016, SMSFs held 30% fund assets in direct Australian shares, 25% in cash and term deposits, and 15% in direct Australian property according to the ATO. The remaining 30% of SMSF assets were held in trusts and other managed investments, as well as 12 other categories.

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