Rivkin GEF – Performance Report – September 2020

Last update - 5 October 2020 By Rivkin

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 September 2020 Unit Price – A$0.9107

Welcome investors to the monthly update for the Rivkin Global Equity Fund (GEF) for September 2020. In line with weakness across broader equity markets, the GEF declined 2.23% for the month of September, with the NAV price finishing the month at 0.9206. The GEF held up better than the broader market, with the S&P500 declining by 3.92% over the same period, and follows five months of gains, as markets recover from the sharp decline between February and March.

PORTFOLIOS GEF
Latest Month -2.23%
QTD 10.58%
Calendar YTD -5.68%
Financial YTD 10.58%
12m 2.08%
Inception -7.94%

Monthly Commentary

For US equity markets, September was the first negative month since March, and follows five months of positive gains as equity markets recover from the pandemic induced decline between February and March. Markets remain rather sensitive to the US political landscape, with the Presidential election now less than one month away. This was evident late on Friday when President Trump confirmed he had tested positive to Covid-19, which led to a sharp sell-off for US futures. More so, wrangling between the Republicans and Democrats over the next round of fiscal stimulus has come to a standstill, with the size and details of the next package now expected to be confirmed after the election results are known. This will no doubt delay the economic recovery currently underway. In Australia, Treasurer Josh Frydenberg delivered the 2021 Federal budget in Parliament on Tuesday night, which has been largely well received. Cuts to personal income tax, originally scheduled for 2022, will now be backdated to July 2021, and will provide an additional $12 billion to Australian taxpayers. In additional, asset write-offs and a large infrastructure spend will aim to boost investment.

Regarding the current portfolio composition, we have taken a slightly more defensive stance with the GEF, as say compared to the AEF. As of the month end of September, we currently hold 22.0% of capital in cash, leaving just 78% invested in equities. We have achieved this by trimming our US Momentum stocks, which tend to be much more volatile than the broader market, with the overall strategy going from 37.6% to 26.5% weighting over the course of the month. The quality strategy remains fully invested, while we have slightly reduced our discretionary stocks as well. This is in response to not only the very strong rally over the past five months, which now appears to be faltering somewhat, but also the increased risk of volatility coming into the US election in early November. Equity markets dislike uncertainty, and with Trump recently contracting Covid-19, and talks of the election results potentially ending up in the high court, there is plenty of reasons for equity markets to wobble over the coming weeks.

In terms of the current portfolio composition, the bulk of equities are across three sectors, being information technology (29.9%), consumer discretionary (21.1%), and health care (18.1%), while our top 10 positions account for 30.9% of our equity market exposure.

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

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