Fund Objective: The Rivkin Global Equity Fund aims to produce positive average annual returns while seeking to maintain a level of volatility lower than that of the MSCI World ex Australia 100% Hedged to AUD Index over the same investment period.
30 November 2020 Unit Price – A$0.9721
Welcome investors to the monthly update for the Rivkin Global Equity Fund (GEF) for November 2020. Broadly speaking, November was a good month for equities in the U.S, however individual stock performance was concentrated in specific areas of the market, the reasons which we discuss below. Nevertheless, the GEF had a very good month, with the Fund increasing in value by 11.49% during the month of November, concluding with a NAV price of 0.9721.
| PORTFOLIOS | GEF |
|---|---|
| Latest Month | 11.49% |
| QTD | 6.67% |
| Calendar YTD | 0.61% |
| Financial YTD | 17.96% |
| 12m | 3.96% |
| Inception | -1.80% |
Monthly Commentary
There were two major events for the month, the first being the U.S Presidential election, while the second was several news announcements relating to the roll out of Covid-19 vaccines. Beginning with the US election, and while the results were closer than expected, the result was in line with prior polling, with Joe Biden declared the presumptive winner. Despite Donald Trump failing to formally concede at this point and pushing his case of voter fraud in several key swing states, a change in the US Presidency seems all but guaranteed. This has been met by optimism from equity investors, clearly excited by a return to a more predictable administration.
However, it was the announcement by Pfizer on Monday the 9th that the FDA had endorsed the safety and efficacy of their Covid-19 vaccine that led to sharp moves in specific areas of the market. As effective vaccines are perceived as a key requirement in enabling economies to reopen, it was the stocks that would directly benefit from this occurring that rallied. Such stocks tended to be the ones sold off the heaviest earlier in the year, such as travel, banking, energy, and property stocks. At the major GICS level, the top performing sectors from the S&P500 for the month were energy (+26.57%), and financials (+16.75%).
The announcement by Pfizer has since been followed by two other major pharmaceutical companies announcing that their vaccines are due for release, with the UK being the first major western country to authorize one for use. This week, the UK will begin its initial roll out of the Pfizer/BioNtech vaccine, with health care workers and the elderly in care homes amongst the first groups to receive it.
In terms of the current positioning of the portfolio, we have maintained a relatively aggressive weighting to equities over this time, with the cash weighting of the fund decreasing further from 13.6% at the end of October to just 6.5% by the end of November. Much of this went to the US Momentum portfolio, with many stocks in the portfolio doing particularly well in November. Top performers for the month include Moderna (+126.4%), Pinduoduo (+54.3%) and Tesla (+46.3%).
In terms of the current sector exposure in the GEF, the information technology, health care, and consumer discretionary sectors remain our highest weightings at 34.5%, 20.0% and 19.0% respectively.
Looking ahead, and December tends to be a positive time for stocks, particularly the last two weeks of the year, which is commonly known as the ‘Santa Claus Rally’. More so, we expect to see additional fiscal stimulus in the US early in the new year once the transition to a new administration occurs.
If you have any questions regarding the above or your investments with Rivkin in general, please call us on 02 8302 3605.
Performance
NAV Price Chart
Monthly Returns
Portfolio Composition
Sector Breakdown
Top 10 Stock Holdings
Strategy Weighting
Fund Description & Information
The Fund invests predominantly in listed Global companies listed on developed market exchanges whose characteristics satisfy one or more of the strategies that occupy the portfolio. These strategies include: Momentum, being securities that are enjoying positive price trends; Quality, being companies with robust earnings profiles that are priced favourably versus their peers; and Defensive, being securities that provide a combination of characteristics including fixed income or high yield returns, negative or low short-term correlation to risk markets like equities or outcomes that we consider to be market-neutral. The Fund operates within the context of a rules-based framework that encourages a disciplined, long-term approach to equity exposure among developed global markets.
Important Disclaimer
The Rivkin Global Equity Fund is available to wholesale investors only. Past performance is not a reliable indicator of future performance. The value of your investment may rise and fall, and you may not receive the amount originally invested.
Contact
Thomas Silitonga – Director, Rivkin Asset Management
[email protected] – +612 8302 3605
