BEST AUSTRALIAN SHARE FUNDS
This category always has a big field of winners and placegetters and this year three funds tied for first place, including one of last year’s winners, Greencape Broadcap. The other winning funds are Greencape High Conviction, which was equal second last year, and Macquarie High Conviction. Greencape Broadcap invests in a portfolio of 25 to 70 high-quality stocks that reflect the managers’ best ideas from large, mid and small capitalisation stocks.
“Greencape Broadcap’s expert investors are highly adept at uncovering and acting upon investment opportunities on the back of unwavering and creative research,” says Morningstar analyst Tim Wong.
“Founders David Pace and Matthew Ryland are among the best stock pickers in the Australian market in our view.
“This strategy isn’t the cheapest around, given the additional performance fee.
But ultimately this is a relatively small blemish on one of the finest Australian equity strategies available,” says Wong.
On top of its 0.95% annual fee it also charges 15% on any performance in excess of the S&P/ASX 300 Index (net of fees). Greencape High Conviction came second last year. Its thorough fundamental process results in a growth-leaning portfolio of about 35 to 40 stocks, says Wong.
Morningstar gives both the Greencape funds a gold rating. Macquarie High Conviction aims to outperform the S&P/ ASX 200 Accumulation Index over the medium to long term, providing capital growth and some income, usually holding 25 to 30 securities. Zenith, one of the judges for the awards, gives the fund a highly recommended rating. “Macquarie’s investment philosophy is based on four key tenets: every company has a price; the market is efficient in the long run but can be inefficient in the short term; undervalued companies will only re-rate once expectations are met or exceeded; and fundamental research is the best way to forecast future earnings,” says a Zenith June 2017 report into the fund. “Zenith has a high regard for Macquarie’s investment personnel and capabilities,” says the Zenith report. “Macquarie’s approach to fundamental research is strong, incorporating detailed financial modelling and an extensive company visitation program.”