Any managed fund posting outperformance of 24.3 per cent net in its first full year of operations in Australia, and achieving this in a year when equity markets are thrown into turmoil, has likely put itself in line to win an award.
In the case of the Acadian Australian Equity Long Short Fund, it has propelled Acadian Asset Management into the winner’s circle of the Hedge Funds (Long Short Australia Equities) category of this year’s awards.
It took out the inaugural hedge fund category award ahead of fellow finalists Portfolio Partners for its High Growth Shares Trust and JANA for its Australian Share Long Short Trust.
Acadian’s 130/30 fund was created in late February 2006 out of an Australian-based joint venture in 2005 between Boston-based Acadian Asset Management and Colonial First State.
Acadian Australia Asset Management chief executive Chris Clayton said it was a “small new fund in Australia but with the backing of a parent company that has a 20-year track record of successfully managing global equities”.
“The breadth of our investment universe, our ability to consider not just the stocks in our benchmark, has enabled the fund to do very well in both its shorts and its longs in 2007.”
He said the fund, which had funds under management of $850 million as at last December, experienced “nine months of outperformance during 2007 and only three months of underperformance”.
“We certainly had our best period leading up to August, although we didn’t have too bad a time through the back end of the year, even with all the market turmoil.”
It was also a “year of two halves” for Portfolio Partners’ High Growth Shares Trust, according to senior investment manager Richard Dixon.
The fund did 23.8 per cent on a net basis for 2007, compared to just under 8 per cent on a net basis by its benchmark ASX 200 Accumulation Index, Dixon said.
“We probably got three-quarters of the year’s excess return in the second six months of the year, when the volatility in the market had “really hit home”.
He said a disproportionate component of the trust’s excess returns last year came from its short selling, or “somewhere in the vicinity of 7 per cent of our 9.5 per cent excess”.
JANA’s Australian Share Long Short Trust also turned in its best performance over the “last three or four months” of 2007, according to investment specialist Matthew Newham.
“The market volatility really kicked in from about August, and that’s when long-short investing really was able to show its true colours.”
The fund had an “absolute return” of 23.4 per cent compared to the benchmark ASX 300 return of 16.22 per cent, he said, which he attributed to an “exceptional performance” from its three underlying managers.
— Liam Egan
