Why to eye quant funds: Meme Capital Management
[[{"fid":"28625","view_mode":"default","fields":{"format":"default"},"type":"media","attributes":{"alt":"Why to invest in quantitative funds: Meme Capital","class":"media-element file-default"}}]]
Investors might be missing out on attractive returns and opportunities, which a lot of brokers are unaware of, unless investors have some exposure to quantitative style funds, according to Meme Capital Management.
Meme Capital's chief investment officer, Greg Jude, employed quantitative analysis to pick ex-ASX top 20 stocks that were going up and outperforming.
He held about 90 stocks, some of which did not have any broker research, simply because he picked stocks based on upward movements.
"We can measure those things quantitatively, as we have numbers that we assign to those things, where we compare stocks, one stock to another, a stock to an index, a stock to its peers. And therefore we automatically gravitate to those stocks that are simply doing best in the market," he said.
He said he developed a systematic set of rules in pyramiding stock selection, based on both risk and return.
"The system identifies when we need to pay attention to stocks, or when we need to pay attention at all. For instance, the stocks that are going down and underperforming simply don't enter the universe for us."
As a result of the portfolio construction process, the Meme Australian Share fund made its way into the top 20 performing managed funds in Australia. Year-on-year it returned over 33 per cent, according to the Money Management Investment Centre (MMIC). Meanwhile, over the last three years, it produced over 22 per cent per annum.
Jude said the portfolio just followed the rules and parameters he set and the results just essentially spoke for themselves.
"It's unashamedly bottom-up. It's not thematic at all. So we didn't decide a year ago that gold was going to do what it's done, we just automatically, by virtue of the strategy, take positions in the stocks that are presenting opportunity to us.
"We might find in hindsight that we were holding a lot of material stocks, which we are at the moment. Not the big end of town, not the BHPs and Rios, the smaller stocks that are performing well," Jude said.
Recommended for you
Statutory NPAT at Pacific Current has almost halved in FY25 to $58.2 million as the result of an investment restructure.
Being able to provide certainty about redemptions is worth fund managers pursuing when targeting the retail market even if it means sacrificing returns, according to Federation Asset Management.
Regal chief investment officer Philip King will step down from listed investment company VGI Partners Global Investments after the LIC reported a loss of $17.6 million for FY25.
Real asset commentators have shared what advisers should be considering when conducting their due diligence on the assets and how they can mitigate illiquidity for retail clients.
