Hyperion Flagship Investments posts worst performance period
Hyperion Flagship Investments has blamed an underweight position in resources for the fund recently posting its worst period of investment performance relative to the market.
The portfolio underperformed the market by 8.8 per cent over the June quarter and 8.6 per cent for the 12 months to June 2008. The S&P 500 declined by 13.7 per cent in Australian dollar terms during the quarter.
In an announcement to the Australia Securities Exchange this morning, Hyperion said the mining sector’s lack of a competitive advantage, high-risk nature and return volatility were the reasons it chose to be underweight in mining companies.
It added that, “Over the past 12 months, shareholders have regrettably seen a decline in NAV [net asset value] per share of 29.9 per cent. The difference in the performance as compared to the portfolio return is primarily due to the dilutive effect of the large placement undertaken in October 2007 at a 7.25 per cent discount to the NAV.”
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