Investment approach

To deliver the strongest possible returns in each of our funds relative to the different level of risk/exposure and volatility each fund targets.

Your Fund Managers have developed three systematic algorithms that each pursue a different return objective constrained by the target exposures and volatility each strategy is built to bear.

Each fund uses some combination of Trend Following/Momentum and Mean Reversion across a wide range of strategy objectives and timeframes. The significant differences in the return profiles of each fund and the volatility they experience derive mostly from the level of investment exposure each fund is willing to tolerate.

At opposite extremes:

• The Aggressive Fund has maximum long exposure of 320% (very rare – back-tested exposure exceeds 250% about once per year). Maximum short exposure of 275% (short exposure exceeds 100% less than once per year in back-testing). The average gross exposure (long exposure plus short exposure) is 115% – though average net exposure in >50% long. Back-tested annualised volatility is 27.8% ~1.6x that of the S&P500 over the testing period.
• The Conservative Fund never uses leverage, does not short and historically carries average cash holdings of 19.9%. Back-tested volatility (1 January 2000 – 31 August 2025) is 14.1%, about half of the S&P500 (in AUD) over the same period.

The Aggressive Fund is the most wide-ranging strategy. Currently operating across Australian, Canadian, Hong Kong and US markets, The Aggressive Fund will go anywhere it can find an edge that is systematisable and repeatable that can be executed with sufficient liquidity at the small scale the fund operates.

The Long/Short Global Fund operates a more scalable investment strategy with a primary focus on the largest, most liquid names in the Australian, Canadian and US markets. 

The Conservative Fund is primarily exposed to the largest, most liquid Exchange Traded Funds in the world, augmented by exposure to very large capitalisation US listed businesses (usually >USD20B).

The Aggressive Fund and The Long/Short Global Fund are absolute return products with the level of performance fee scaling (see Information Memoranda) depending on the level of performance delivered. For both funds, the highest performance fee level begins when results exceed 18% annualised. Each of these funds nominally compare their performance to Vanguard’s “MSCI Index International Shares ETF (VGS)“, the product your managers feel is best for global equities exposure.

The Conservative Fund benchmarks against the S&P500 as it is the most representative alternative given substantially all exposures in the fund are to US markets.

Each fund charges a modest management fee to cover operating costs as well as the significant computing/data/software costs involved in developing the inputs and outputs required to run a systematic trading operation.

The Aggressive Fund and The Long/Short Fund charge 5 basis points per month. The Conservative Fund charges 3.75 basis points per month.

As noted above, The Aggressive Fund and The Long/Short Global Fund operate a scaled absolute Performance Fee. Once 18% p.a. annualised has been achieved, 30% (plus GST) is earned. Shortfalls against a 12% p.a. target are carried forward to future periods.

The Conservative Fund charges 15% (plus GST) of outperformance above 9% p.a.

Comprehensive outlines of the Performance Fees are available in the respective Information Memorandums of each fund.

Administrative costs (accounting/taxation etc) will be recouped from each fund as incurred but are expected to be very low.
For FY2025 the administrative cost burden for both The Aggressive Fund and The Long/Short Global Fund was below 2 basis points.