Institutional Monthly Update

Performance Review

Plato Australian Shares Enhanced Index Composite (gross of fees and expenses) outperformed the S&P/ASX300 Accumulation Index by 0.23% in March. The largest contributors to active performance included overweight positions in Virgin Money UK, Perseus Mining, Ramelius Resources and Northern Star as well as an underweight position in Arcadium Lithium. However, overweight positions in Pilbara Minerals, Aristocrat Leisure, Cettire and Cochlear as well as an underweight position in Newmont detracted from relative performance. The strategy has tracked 0.77% p.a. ahead of its benchmark since inception and delivered an information ratio of 0.8.

Plato Australian Shares Tax-Exempt Composite (gross of fees and expenses) underperformed the S&P/ASX200 Accumulation Index (post franking credits) by 0.11% in March whilst achieving greater than 20% lower carbon intensity exposure than the benchmark. The largest contributors to active performance included overweight positions in Evolution Mining, Northern Star and QBE Insurance as well as underweight positions in Transurban and Fortescue. However, an overweight position in Westpac as well as underweight positions in Newmont, Santos, Virgin Money UK and Life360 detracted from relative performance.The strategy has tracked 1.48% p.a. ahead of its benchmark since inception and delivered an information ratio of 0.8.

Plato Australian Shares Income Composite (gross of fees and expenses) underperformed the S&P/ASX200 Accumulation Index (post franking credits) by 0.05% in March. The largest contributors to active performance included were overweight positions in Ramelius Resources, Perseus Mining, Northern Star and QBE Insurance as well as an underweight position in Transurban. However, underweight positions in Newmont, Santos, Virgin Money UK, Life360 and Resmed detracted from relative performance. The strategy has tracked 1.72% p.a. ahead of its benchmark since inception, with an information ratio of 0.9.

Plato Australian Shares Low Volatility Income Composite (gross of fees and expenses) underperformed the S&P/ASX300 Accumulation Index (post franking credits) by 0.32% in March. The largest contributors to active performance included overweight positions in Perseus Mining, Santos, Brambles and NIB as well as an underweight position in Pilbara Minerals. However, overweight positions in Collins Foods, Deterra Royalties, Spark NZ and Cochlear as well as an underweight position in Goodman Group detracted from relative performance. The strategy has delivered a 20% higher Sharpe ratio than that of the market since inception and has tracked 0.09% p.a. above its benchmark since inception in March 2013.

Plato Global Shares Low Carbon Enhanced Composite (gross of fees and expenses) delivered a significant reduction in carbon exposure, reducing both carbon intensity (-75%) and carbon footprint (-74.6%) versus the index. The Fund posted a total return of +3%, in line with a strong benchmark. Low carbon intensive names broadly performed in line with the benchmark for March. The Fund’s largest positive contribution to active return came from exposures in the Industrials, Financials and Real Estate sectors. The weakest sectors were Energy, Utilities and Consumer Staples.  Over this period, our benchmark MSCI World was driven by large-cap names with small cap names the biggest drag on the benchmark.

The Plato Global Shares Income Composite (gross of fees and expenses) returned +2.4%, although still trailing a strong benchmark. The Fund continued to generate strong excess income.  From a country perspective, the drivers were Finland and Sweden. At the sector level, income came from Financials and Industrials. The strength of the market was driven by large-cap names, with small cap names the biggest drag on the benchmark. The sectors which were the biggest contributors to the Fund’s active return were Consumer Discretionary, Real Estate and Consumer Staples. Industrials, Energy and Financials were the biggest drags.

The Plato Global Alpha Strategy (gross of fees and expenses) delivered a return of 3.97% (after fees) in March versus the MSCI World benchmark of 3.02%. The Fund has generated a return of 22.70% p.a. (after fees) since inception, outperforming the MSCI World benchmark by 12.56% p.a., and beating the benchmark in 89% of rolling quarters. The upside capture is 123% and the downside capture is 77%. Unprofitable Tech and High Growth/Low Margin companies struggled while Cyclicals, Energy, and Infrastructure ramped alongside high strong Sentiment names. Our long positions were the key drivers of the strong alpha over the month. Key stock contributors over the last twelve months include NVIDIA, Broadcom, and Eli Lily up 234%, 116% and 135% respectively.

DISCLAIMER

This communication is prepared by by Plato Investment Management Limited (‘Plato’) (ABN 77 120 730 136, AFSL 504616) as the investment manager of the Plato Australian Shares Enhanced Index Strategy, Plato Australian Shares Tax-Exempt Strategy, Plato Australian Shares Income Strategy, Plato Australian Shares Low Volatility Income Strategy, Plato Global Low Carbon Strategy, Plato Global Shares Income Strategy. The information in this communication is intended for wholesale investors only. This communication is for general information only. It is not intended as a securities recommendation or statement of opinion intended to influence a person or persons in making a decision in relation to investment. It has been prepared without taking account of any person’s objectives, financial situation or needs. Any persons relying on this information should obtain professional advice before doing so. Past performance is for illustrative purposes only and is not indicative of future performance.

Any opinions and forecasts reflect the judgment and assumptions of Plato and its representatives on the basis of information available as at the date of publication and may later change without notice. Any projections contained in this presentation are estimates only and may not be realised in the future.

Unauthorised use, copying, distribution, replication, posting, transmitting, publication, display, or reproduction in whole or in part of the information contained in this communication is prohibited without obtaining prior written permission from Plato. Pinnacle Investment Management Group Limited (‘Pinnacle’) ABN 22 100 325 184 and its associates may have interests in financial products and may receive fees from companies referred to during this communication.