Long short fund lfs

[Joshuatree]

Prospectus (https://hotcopper.com.au/threads/4145065/)

This listed recently, shares issued at $2. Latest price $2.Demand great with re double plus original mkt cap. 70% in Aus, NZ.
Track record of re 30% plus return per annum.Fees on any profits 20% no hurdle.Timing is good volatility wise. Have a few indirectly.

L1 Capital hands back 'material' amount of capital to wholesale clients

"Melbourne-based equities investor L1 Capital is set to return hundreds of millions of dollars to clients.
Street Talk understands L1 Capital has started notifying some of its institutional clients that they should expect a cheque in the mail, in an effort to keep funds under management at less than $4 billion.
While L1 Capital has not said how much money will be returned, it did tell clients it was a "material" amount.
Street Talk understands it is worth hundreds of millions of dollars.
All of the money returned will be to institutional clients.
"For client confidentiality reasons, we are not disclosing the size or timing of these offsetting outflows, other than to say they are material and will enable us to stay below $4 billion in FUM," the manager told clients this week.
Returning capital is a rare move by an investment manager. It's also likely to create some tough conversations.
However, L1 Capital has already lined up new investors to take their place.
L1 Capital's outgoing clients will be replaced by a new batch of retail and high net worth investors, who together tipped in $1.33 billion for the firm's new listed investment company, L1 Capital Long Short Fund Ltd.
The listed company was initially seeking to raise up to $600 million before it was upsized to up to $1.35 billion.
More than two-thirds of the firm's capital is now expected to be from retail and high net worth investors, who typically pay higher fees to an investment manager than wholesale clients.
It will also be skewed towards L1 Capital's long/short strategy, which has returned 34.9 per cent a year after fees since inception.
It looks like a business decision for L1 Capital and its employee shareholders, headed by founders and co-CIOs Rafi Lamm and Mark Landau. Managing retail and high net worth money is more lucrative and less likely to head out the door in a hurry.
If there is a redemption, or a handful of redemptions, it is unlikely to cause big disruptions for the manager. That's not always the case when it comes to wholesale money. And, in turn, they will be better able to focus on three-to-five year performance, and less on the short term."

"It is not known which of L1 Capital's clients will be handed back their money.
Its biggest fund is a long-only Australian equities fund, which predominantly manages money for big domestic and offshore institutions such as Catholic Super, Sunsuper and HOSTPLUS, and recently opened to retail investors
owever, the current known ASX positions are CNU, NEC, BLD, QAN, BSL, MQA, NWS, MIN, ORG (can be found in the monthly/quarterly reports or on interview videos)."

[Joshuatree]

Cant changer the header, ticker is LSF on the ASX not LFS.

[Lego_Man]

Prospectus (https://hotcopper.com.au/threads/4145065/)

This listed recently, shares issued at $2. Latest price $2.Demand great with re double plus original mkt cap. 70% in Aus, NZ.
Track record of re 30% plus return per annum.Fees on any profits 20% no hurdle.Timing is good volatility wise. Have a few indirectly.

L1 Capital hands back 'material' amount of capital to wholesale clients

"Melbourne-based equities investor L1 Capital is set to return hundreds of millions of dollars to clients.
Street Talk understands L1 Capital has started notifying some of its institutional clients that they should expect a cheque in the mail, in an effort to keep funds under management at less than $4 billion.
While L1 Capital has not said how much money will be returned, it did tell clients it was a "material" amount.
Street Talk understands it is worth hundreds of millions of dollars.
All of the money returned will be to institutional clients.
"For client confidentiality reasons, we are not disclosing the size or timing of these offsetting outflows, other than to say they are material and will enable us to stay below $4 billion in FUM," the manager told clients this week.
Returning capital is a rare move by an investment manager. It's also likely to create some tough conversations.
However, L1 Capital has already lined up new investors to take their place.
L1 Capital's outgoing clients will be replaced by a new batch of retail and high net worth investors, who together tipped in $1.33 billion for the firm's new listed investment company, L1 Capital Long Short Fund Ltd.
The listed company was initially seeking to raise up to $600 million before it was upsized to up to $1.35 billion.
More than two-thirds of the firm's capital is now expected to be from retail and high net worth investors, who typically pay higher fees to an investment manager than wholesale clients.
It will also be skewed towards L1 Capital's long/short strategy, which has returned 34.9 per cent a year after fees since inception.
It looks like a business decision for L1 Capital and its employee shareholders, headed by founders and co-CIOs Rafi Lamm and Mark Landau. Managing retail and high net worth money is more lucrative and less likely to head out the door in a hurry.
If there is a redemption, or a handful of redemptions, it is unlikely to cause big disruptions for the manager. That's not always the case when it comes to wholesale money. And, in turn, they will be better able to focus on three-to-five year performance, and less on the short term."

"It is not known which of L1 Capital's clients will be handed back their money.
Its biggest fund is a long-only Australian equities fund, which predominantly manages money for big domestic and offshore institutions such as Catholic Super, Sunsuper and HOSTPLUS, and recently opened to retail investors
owever, the current known ASX positions are CNU, NEC, BLD, QAN, BSL, MQA, NWS, MIN, ORG (can be found in the monthly/quarterly reports or on interview videos)."


The problem i have is that those returns were generated when they were sub 200m - there's an element of "too good to be true" here. The LIC could be seen as a real cash grab and i doubt if returns will be anything close to what has been achieved historically. As a side anecdote in fact i was talking to a guy from Australia about them yesterday - his comment was "they're much better businessmen than they are investors".

The pace of growth that they've shown also inevitably results in teething problems. A multi-billion dollar firm is a different beast from a sub 500m boutique. Some make the transition successfully, others don't.

[Joshuatree]

Yes good point. I was a bit stunned to see the more than doubling the raising. Good thing its liquid and easily tradeable.

[Lego_Man]

Yes good point. I was a bit stunned to see the more than doubling the raising. Good thing its liquid and easily tradeable.

I also find it very cynical when funds hand back capital that's lower-fee paying, to then gorge themselves on retail money. These institutions will in many cases be investors who have supported them at an earlier stage of their development, but don't get to reap the long term rewards.

[Joshuatree]

this is a vote of confidence by management though

The Manager has agreed that its owners will reinvest in the Company all of the ir after-tax proceed sfrom any Performance Fees generated from the Company and these Shares will be escrowed for up to 10 years from listing; and

Mr Raphael Lammand Mr Mark Land au have each agreed to invest $5million into the Company under the Offer.

[Joshuatree]

Not a good month. Holding for when the panic at the disco eventually arrives.
Download Document 409.81KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSTYO6gq0z heZrOR%2Fke92GA%3D%3D)

[Joshuatree]

LSF being caned as growth stocks continue to race up and value stocks decrease. Any opinions as to why.? No flight to quality happening yet, bull mkt surging still in some sectors.

"The performance of the Long Short Fund has been impacted by the recent surge in ‘momentum’/’growth’ stocks and a continued drift in ‘value’ type stocks. Relative valuations of growth versus value stocks are at an historical extreme and we have positioned the portfolio to benefit as markets normalise."

[Lego_Man]

LSF being caned as growth stocks continue to race up and value stocks decrease. Any opinions as to why.? No flight to quality happening yet, bull mkt surging still in some sectors.

"The performance of the Long Short Fund has been impacted by the recent surge in ‘momentum’/’growth’ stocks and a continued drift in ‘value’ type stocks. Relative valuations of growth versus value stocks are at an historical extreme and we have positioned the portfolio to benefit as markets normalise."





30% is going to be hard to reach this year...

[Lego_Man]

Not a good month. Holding for when the panic at the disco eventually arrives.
Download Document 409.81KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSTYO6gq0z heZrOR%2Fke92GA%3D%3D)

June no better - down another 6%.

[Joshuatree]

Playing a longer game with this one giving it year. before i let my savage out. Set and forget until it starts dancing.

[Beagle]

Prospectus (https://hotcopper.com.au/threads/4145065/)

This listed recently, shares issued at $2. Latest price $2.Demand great with re double plus original mkt cap. 70% in Aus, NZ.
Track record of re 30% plus return per annum.Fees on any profits 20% no hurdle.Timing is good volatility wise. Have a few indirectly.

L1 Capital hands back 'material' amount of capital to wholesale clients
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Great concept but I find the fees grossly objectionable. 20% without any hurdle is blatant price gouging in my opinion. When you consider this is primarily an Australasian investment (70% in N.Z. or Australia) people are probably better picking their own longs and taking some protection on the downside through index futures or some other method. You might want to think about a 15% stop loss...

[Joshuatree]

I agree re the fees, said the same thing to myself. But if they do follow their past track record in returns i will be happy. Holding indirectly with the thought that the bull mkt may be ending soon and volatility is a strong likelihood, so a small slight hedge to our portfolio. Not something to look at and fret about daily or weekly.Planning on year then reviewing unless something calamitous happens with the s/p.

Stop losses are for traders,LSF is in our investment portfolio. i hardly ever use them for my small trading portfolio either but understand it being useful to some traders. I cant see the IRD going along with an "investment" stock with a stop loss on it but value your knowledge there Beagle.

[Beagle]

As far as I'm aware you're entitled to take reasonable measures to protect your capital...so I can't see any issue with utilizing a stop loss but as you say, its a small part of your overall portfolio so you might as well let it ride and see what happens. I agree 100% that we live in interesting times. That said a few experts on CNBC have been saying lately that the S&P 500 is trading on just over 16 times forward earnings so the tax cuts over there seem to have worked some magic...at least for now.

[Joshuatree]

Still tracking down in NTA as some may expect , with the Bull mkt intact. .Re 6 directors have bought shares in decent numbers on market in the last month.
NTA $1.66 s/p $1.68. low has been re $1.65

[Joshuatree]

One of the few stocks up today. Has its time come to shine? a good hedge for ones portfolio if volatility stays /increases.

[Joshuatree]

Been a dog and an embarrassment and brickbats to Craigs for one who pumped it as a low risk conservative investment. They have downgraded it.

But an interesting read with lots of info about the mkts and their current faves.Chorus is a strong pick(long) with spending on fibre peaking and gains ahead.
Download Document 996.85KB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSTYP4g25z BKZrOR%2Fke92GA%3D%3D)

[Joshuatree]

Took a punt today (instead of latitude), chart looking way better and their performance looks to be improving at last.We will see.
Monthly Investment Report September 2019 (https://online.asb.co.nz/ost/4A40B2331634F1CD2385ED91DB6DF846/companyannouncements/showannouncement/asx/lsf?issuercode=lsf&number=526021&ispdf=true)

[Joshuatree]

An easy 10% for me atpit. 18% so far this year. Qrtly below
Download Document 1.59MB (https://hotcopper.com.au/documentembed?id=uOMxKKzFkiWRTLKhOROKAxjvSTYP4Qi7w BOZrOR%2Fke92GA%3D%3D)

A good read up and research on ILU Iluka (the some of the parts).

[DarkHorse]

Hi JT interested to see your posts as I've just been looking into Regal's high performing long-short funds - esp as they now have an LIC on asx. Apart from also having highish fees, Regal do appeal for their long term track record under Philip King (see recent livewire interviews)... several of their funds went through the GFC finishing flat for 2008 (while asx was down c50%), likewise during 2011 downturn, and all have very good to excellent average long term returns.
Of course I'd be happy to hear any contrary views; still haven't made up my mind.

[Joshuatree]

Hi, ive heard Regal are one of the better funds with a great track record,as you say.LSF has a way to go to prove itself and is still in the red from its listing price.

[Joshuatree]

LSF Investor Conference Call - Presentation 33 pages 1.1MB (https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02173329)

[Tronald Dump]

Hi JT interested to see your posts as I've just been looking into Regal's high performing long-short funds - esp as they now have an LIC on asx. Apart from also having highish fees, Regal do appeal for their long term track record under Philip King (see recent livewire interviews)... several of their funds went through the GFC finishing flat for 2008 (while asx was down c50%), likewise during 2011 downturn, and all have very good to excellent average long term returns.
Of course I'd be happy to hear any contrary views; still haven't made up my mind.

FYI, Regal's offices were visited by ASIC yesterday under a search warrant, with an investigation being carried out into the trading of 'certain securities'.

Philip King of Regal has been subject to an ASIC enforceable undertaking in the past relating to trading in Ten Network shares.

Watch this space.

[Joshuatree]

https://www.smh.com.au/business/companies/asic-investigates-prominent-investor-regal-funds-management-20191126-p53e9f.html

[Joshuatree]

Latest NTA$1.7162
S/P $1.16 biggest discount ever i think. Why?

[younga]

Joshua tree, which company is this?

[Joshuatree]

Have a lazy scroll back youngster.

[Tronald Dump]

Latest NTA$1.7162
S/P $1.16 biggest discount ever i think. Why?

Something to do with the fact that investors don't know what's in the portfolio, plus the last time there was a market correction (late 2018) the fund lost 14% in 4 months and 26.6% in the year. (vs. -2.8% for the ASX200). So no evidence of ability to protect capital in a down market. In fact, evidence of no ability to protect capital in a down market.

[Tronald Dump]

Latest NTA$1.7162
S/P $1.16 biggest discount ever i think. Why?

NTA is down -16% this month so far.

FYI Regal's 'high performing' Atlantic fund was down -32% in February - god knows what March will be like.

[Tronald Dump]

LSF portfolio returned -22.9% in March, below the index. Regal Atlantic was down almost 60% in one month. Salt Long short lost 14%. So much for downside protection by ‘absolute return’ fund managers.