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Managers Comments for August 2011
VOLATILITY: THE NEW NORMAL
Porter Capital’s Prime Momentum fund (MTM) returned +0.23% for August. The benchmark S&P/ASX200 Accumulation Index lost -1.91% for August. MTM therefore outperformed the S&P/ASX200 (after management fees) by +2.22% for the period. Total return for MTM since inception (August 2010) is +5.16% versus the benchmark return of +1.50% for the same period.
There has been nowhere to hide over the past month in equity markets. The Federal Reserve saying there “are significant downside risks to the economic outlook” and the ongoing debt issues in Europe has motivated investors to continue to take risk off the table and therefore cash out of global equity markets. Due to this, momentum remains negative and we continue to hold the portfolio in the defensive cash position (100%) which we initiated early in May.
Volatility is the new normal. The days of the buy and hold strategy being viable are long gone. Dynamic, active and disciplined portfolio management is essential in the current environment to preserve capital when markets are unfavourable and to make the most of markets when conditions eventually turn positive. We continue to hold a defensive cash position for investors until this is the case.
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About the manager
Porter Capital Management is a professional funds manager offering innovative, system-based investment solutions to institutions, financial advisors and individual investors.
For further information
Phone: 1300 13 44 22
Web: www.portercapital.com.au
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| Return % * |
1m |
6m |
1yr |
Inc.** |
| Prime Momentum (MTM) |
0.23
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-8.21
|
5.01
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5.16
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| S&P ASX200 Accumulation |
-1.91
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-8.98
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1.92
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1.50
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| * Returns are after management + administration fees and before performance fees. ** Since inception of product (11th August 2010) |
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This product is for investors seeking...
Protection of Capital in a downturn: Moves to 100% cash in difficult economic conditions
Systematic Investment Process: A purely systematic and unemotional process which enforces discipline, objectivity and accountability during difficult investment cycles
Diversification: Low correlation to core fundamental equity managers and major indicies
A Strategy suitable for superannuation funds
Interests that are aligned with their own and a manager compensated on performance
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Key Portfolio Features
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Benchmark
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S&P/ASX200 Accumulation Index
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Suggested Timeframe
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3 - 5 years
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Typical Number of Stocks
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0 - 20
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Investment Fee
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1.30%
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Performance Fee
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20% of outperformance
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Historical Portfolio Turnover
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Medium
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Style
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Growth
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Investment Universe
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S&P/ASX200
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Process
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Quantitative
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| This report provides general information only and does not take into account the investment objectives, financial circumstances or needs of any person. To the maximum extent permitted by law, Porter Capital Management (PCM), its directors and employees accept no liability for any loss or damage occurred as a result of any action taken or not taken on the basis of the information contained in the report or any omissions or errors within it. Before making an investment decision you should consider the latest Product Disclosure Statement and Financial Services Guide and assess whether the product and/or service is appropriate for you. It is advisable that you obtain professional independent financial, legal and taxation advice before making any financial investment decision. PCM does not guarantee the repayment of capital or payment of income, or the performance of its investments. |
