Institutional Monthly Update

Performance Review

Plato Australian Shares Enhanced Index Composite (gross of fees and expenses) outperformed the S&P/ASX300 Accumulation Index by 0.29% in July. The largest contributors to active performance included overweight positions in Ampol, AMP and HUB24 as well as underweight positions in Liontown and Pro-Medicus. However, overweight positions in Codan, Megaport, Zip Co and Ventia as well as an underweight position in Commonwealth Bank detracted from relative performance. The strategy has tracked 0.84% p.a. ahead of its benchmark since inception and delivered an information ratio of 0.9.

 

Plato Australian Shares Core Composite (gross of fees and expenses) underperformed the S&P/ASX300 Accumulation Index by 0.14% in July. The largest contributors to active performance included overweight positions in Ampol and HUB24 as well as underweight positions in Liontown, Pro-Medicus and Nextdc. However, overweight positions in Codan, Ventia, Elsight and SRG Global as well as an underweight position in Commonwealth Bank detracted from relative performance. The strategy has tracked 1.95% p.a. ahead of its benchmark since inception and delivered an information ratio of 1.3.

 

Plato Australian Shares Tax-Exempt Composite (gross of fees and expenses) outperformed the S&P/ASX200 Accumulation Index (post franking credits) by 0.01% in July whilst achieving greater than 20% lower carbon intensity exposure than the benchmark. The largest contributors to active performance included overweight position in Ampol as well as underweight positions in Lynas, PLS Ltd, Pro-Medicus and Fortescue. However, overweight positions in Rio Tinto, QBE Insurance and Codan as well as underweight positions in South32 and Woodside detracted from relative performance. The strategy has tracked 1.42% 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 0.46% in July. The largest contributors to active performance included underweight positions in Lynas, PLS Ltd, Pro-Medicus, Fortescue and Liontown. However, overweight positions in QBE Insurance, Codan and Evolution as well as underweight positions in Woodside and South32 detracted from relative performance. The strategy has tracked 1.60% p.a. ahead of its benchmark since inception and delivered 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 0.18% in July. The largest contributors to active performance included overweight positions in Ampol, Viva Energy and Fisher & Paykel Healthcare as well as underweight positions in Goodman and Lynas. However, overweight positions in Codan and Sims as well underweight positions in Commonwealth Bank, NAB and Woodside detracted from relative performance. The strategy has delivered a 20% higher Sharpe ratio than that of the market since inception and has tracked 0.29% p.a. ahead of its benchmark since inception.

 

Plato Australian Defensive Income Composite (gross of fees and expenses) underperformed the S&P/ASX200 Accumulation Index (post franking credits) by 0.04% in July. The largest contributors to active performance included an overweight position in Ampol as well as underweight positions in Pro-Medicus, Liontown, Goodman and PLS Ltd. However, overweight positions in Codan, QBE Insurance, Sims, NRW and Helia detracted from relative performance.

 

Plato Global Shares Core Composite (gross of fees and expenses) returned -0.94% in July, underperforming the benchmark by 0.02%. The largest contributors to active performance included overweight positions in Draegerwerk AG and QinetiQ as well as an underweight position in Tesla. However, overweight positions in KLA Corporation, Lam Research and Applied Materials detracted from relative performance. The strategy has tracked 2.14% p.a. ahead of its benchmark since inception.

 

Plato Global Shares Low Carbon Enhanced Composite (gross of fees and expenses) delivered a significant reduction in carbon exposure, reducing both carbon intensity and carbon footprint by approximately 75% versus the index. The Fund posted a total return of -0.46%, outperforming the benchmark by 0.45%. The attribution due to the funds carbon exposure provided a tailwind for relative performance. At the sector level positive stock selection was driven by exposures in Financial and IT companies. At the stock level the most significant contribution was from an overweight to UK Industrial, QinetiQ and the underweight to recent index addition, Space Exploration (SpaceX).

 

The Plato Global Shares Income Composite (gross of fees and expenses) returned -0.67% in July, outperforming the benchmark by 0.24%. In July, dividend paying companies outperformed their non-paying counterparts, providing a tailwind for the fund. Strong stock selection within the IT sector reversed, resulting in it being the main detractor to relative performance. This was offset by positive contributions from other sectors, including Industrials, Communication Services and Consumer Discretionary. At the stock level the most positive contribution was from the underweight to struggling US Consumer Discretionary company, Tesla.

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 Australian Defensive Income Composite, 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.