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Australian Unity Acorn Microcap Trust |
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Rebate |
4.00%
as additional units |
| Minimum
Investment |
$1,000 |
About
the Fund
The first
of its kind, the Fund is one of Australia’s few
specialist funds to focus solely on microcap stocks.
Microcaps are defined as the companies falling
outside the top 250 companies, that is, smaller
companies on the Australian Stock Exchange (ASX)
ranked by market capitalisation.
These companies are generally under-researched and
the Fund’s investment manager aims to uncover
significant investment opportunities for capital
growth over the long-term.
Who is
the investment manager?
Acorn Capital Limited (Acorn Capital) manages the
microcap Australian shares portfolio of the Fund.
Australian Unity Funds Management Limited and Acorn
Capital manage the Fund’s cash.
What
does the Fund invest in?
The Fund gains exposure to microcaps by investing in
the Acorn Capital Wholesale Microcap Trust, which
primarily invests in microcap Australian companies
listed or soon to be listed on the ASX.
The Fund generally invests between 80-100% of its
assets in Australian shares, with up to 20% able to
be invested in cash and similar investments.
What
is the Fund’s investment process?
Acorn Capital’s experienced team of analysts use a
disciplined investment process to select stocks in an
under-researched sector of the market.
The Acorn Capital team narrows the microcap investment
universe down from more than 1,800 to a portfolio of
typically between 65 and 80 stocks. Through this process,
Acorn Capital aims to exploit the undervaluing of stocks
that arise from information gaps about microcaps, and to
identify opportunities for long term capital growth.
Acorn Capital’s portfolio construction takes the following
approach:
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Australian Unity Acorn Microcap Trust |
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APIR Code |
AUS0115AU |
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Inception date |
December
2002 |
|
Minimum Initial Investment |
$1,000 |
|
Minimum Additional Investment |
$500 |
|
Minimum Regular Saving Plan |
$100
per month |
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Entry/Contribution Fee |
4.10% |
|
Minimum Withdrawal Amount |
$1,000 |
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Exit/Withdrawal Fee |
Nil |
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Management Costs |
2.50%
pa |
|
Buy/Sell Spread |
Buy:
0.05% Sell: Nil |
|
Income Distributions |
Annually |
Identification of the eligible universe
The identification of eligible microcap stocks involves
excluding from the microcap universe all companies that:
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Are currently suspended; |
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Typically have a market
capitalisation of less than $5 million; or |
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For other reasons are
impractical investments. |
This initial screen effectively removes over
500 companies from the eligible universe.
Identification of the approved list
Identification of the research and the subsequent Approved
list is achieved by applying investment criteria to the
eligible universe.
Acorn Capital categorises companies as either mature or
developing.
Research into these two groups demands different analytical
approaches. Mature Companies are ranked on factors including
price, earnings, liquidity and profit. Developing companies
are screened with an emphasis on appraising the management’s
history, balance sheet value and potential to generate
earnings in the future.
The screening reduces the eligible research list investment
population to around 300 companies-those considered worthy
of additional research.
An evaluation of company management is then undertaken which
may require visits to evaluate physical facilities, followed
by the preparation of future earnings and cash flow
estimates, or, in the case of developing companies, an
assessment of the value of intellectual property,
exploration, etc.
Acorn Capital’s research focus includes:
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The quality of management; |
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Outlook in respect of the
external environment- cyclical factors; |
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Business strategy; |
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Competitive strengths; |
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Profit and cash flow (current
and forecast) |
This step of the process identifies the
Approved list of investments of typically between 120 and
150 stocks.
The final step in the investment process is to build the
fund portfolio, typically expected to hold between 65 and 80
stocks. The portfolio is constructed around specific risk
controls and constraints designed to appropriately manage
portfolio risk.
Trading and execution are of the utmost importance to
successful investment management of microcap portfolios;
given the sectors wide bid/ask spreads and the possibility
of substantial market impact.
Acorn Capital has adopted a trading strategy designed to
minimise market impact while seeking to maximise potential
investor returns.
Derivatives
Acorn Capital may use derivatives in the management of the
funds, but will generally not use derivatives for gearing
purposes or speculative activities.
More information
The Fund’s
performance and unit prices are available to view at:
www.australianunityinvestments.com.au/amt
Important information
This investment product is issued by Australian
Unity Funds Management Limited ABN 60 071 497 115, AFS
Licence No 234454. This information is intended only to
provide a broad summary of this financial product.
Investment decisions should not be made upon the basis of
its past performance or distribution rate, since future
returns will vary. You should refer to the current Product
Disclosure if you wish to know more about this product. The
information provided here was current at the time of
publication only. |
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