Welcome to your growth story
Welcome to your growth story

Hyperion

Asset Management

Perhaps you’re familiar with Hyperion or perhaps you’ve never heard about us but are interested in building your wealth over the long term.

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YOUR GOALS

The search for investment returns


You’ve worked hard to build your savings. Your bigger lifestyle goals – perhaps an early retirement, a retirement filled with travel, or to help your kids – are the ends while your savings and investment plans are the means to those ends. You know you need to grow your savings but one of the toughest questions to answer is “where to invest?”.

But with so many shares and equities investment options locally and across the globe, you want to be sure you’ve made the right choice, a choice that generates real returns.

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BIG PICTURE

Macro headwinds all investors should understand


In choosing where to invest, you’ll want to be aware of the difference between information about the fundamentals of the company you’re considering investing in via their shares, and market noise. Fundamentals drive the long-term share price while market noise does not.

It’s tempting to put too much emphasis on noise. After all, it’s in the daily media and often sensationalised. Many investors make the mistake of trying to predict the long-term value of a company based on today’s “hot” news. Unless trading is your day job (or you’re a computer-based trading program), it’s hard for you to win, where winning includes both protecting your capital and generating significant investment returns.

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BENJAMIN GRAHAM

Benjamin Graham, the father of value investing, explained that in the short run, the stock market is like a voting machine - tallying up which firms are popular and unpopular. But in the long run, the market is like a weighing machine - assessing the substance of a company.

PAST PERFORMANCE

Will what's worked in the past work in the future?


You could now be thinking to yourself that buying and holding a low cost investment that tracks the index – like an ETF – could be a smart choice? After all, stock markets have historically risen over the long term making a buy-and-hold strategy of an index with low fees an appealing option.

Unfortunately, we suggest traditional index investing won’t get you there, even after fees.

Consider this. In the decades prior to the GFC, investment returns achieved by key global indices were boosted by strong global economic growth rates, and a significant reduction in interest rates which allowed businesses to borrow and expand. Consumers and governments also borrowed heavily, bringing forward consumption and investment, boosting economic growth.

However, we now face a very different economic outlook. Australian indices are dominated by banks, industrial companies and exposure to low quality materials and energy stocks. These are businesses ill-equipped to flourish in a less commodity intensive service and consumer-based economy with low barriers to disruptive new entrants.

Outside Australia, the major stock market indices are also likely to produce lower returns than achieved over the past few decades because of multiple structural headwinds - ageing populations, high debt levels, the disappearing middle class and increasing environmental constraints.

So, while index investing is cheap and easy, you’ll want to be aware that it has a high potential to leave you with lower returns than informed, selective stock picking.

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EXPERTISE

Finding Your Investment Partner


Like you, we’re afraid of losing out on the best long-term returns we can possibly achieve while staying highly focused on avoiding capital loss. That’s because we are also our own clients. If you weren’t already aware, the entire Hyperion team is invested alongside our clients in Hyperion’s products, and nowhere else.

Therefore, we know that there’s a lot at stake. We frequently sit across the table from our clients – be that individuals, their advisers, and the superannuation funds’ investment teams - we understand the impact good and bad investment decision can make. We never lose sight of the fact that we are investing the money of real people, and these real people’s long-term financial futures are in our hands.

In fact, we’re so driven by delivering returns, both for ourselves and our clients, that we’ve spent the past two and a half decades researching for the highest quality businesses, with the highest long-term growth potential. We’d like to think we’re pretty good at it, but we’ll let the evidence speak for itself.

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PEACE OF MIND

How We Aim To Future-Proof Your Investments


Much has been written about how only a handful of winners persist in a sea of underperforming fund managers. To be a consistent winner, we believe a rigorous research process is needed to get under the skin of businesses we’d like to invest in. Based on a deep understanding of the fundamentals allows us to identify those companies with the highest long-term growth potential and able to generate returns for our clients that are likely to be above the index and above the pack.

The ability to keep the turnover of our portfolios relatively low (typically it is in the 20-40% range) generally helps boost our clients’ after tax returns and assists in reducing transaction costs and fees. Our portfolio turnover is below the overall market’s turnover and the turnover of many active fund managers. Many active fund managers have high portfolio turnover because they are trying to chase short-term alpha, which is expensive.

The Hyperion’s Global Growth Companies Fund has a base management fee of 0.7% p.a. – lower than the vast majority of our peers. Our performance fee in the Hyperion Global Growth Companies Fund is 20% of outperformance against its benchmark, subject to high water marks and payable only on positive absolute returns, which means that we only do well when our clients do well.

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OUR COMMITMENT

Therefore, we at Hyperion commit to:

Standing firm to our successful investment philosophy of investment for the long-term via picking and holding the highest quality stocks

Striving to enhance our investment process at every opportunity. In fact, it’s embedded in our monthly investment reviews

Always aligning our interests with our clients through co-investing in our products – we call this eating our own cooking

Keeping our fees reasonable for the expertise we bring so your investment returns are maximised

Persistence Pays

Finding The "Unicorn" Fund Manager


Analysis from the US (SPIVA U.S. Year-End 2018 report) showed that fewer than 8% of US large-cap active fund managers, that is fund managers that actively selected stocks and constructed investment portfolios, outperformed the index over the last 15 years. Finding those persistent outperformers is a bit like finding a unicorn.

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Hyperion Broad Cap Composite (Australian Equities)

A$100,000 invested in the Hyperion Broad Cap Composite in 1996 would now be worth A.

▬▬ S&P/ASX 300 Accumulation Index

▬▬ Hyperion Broad Cap Composite

These are historical investment returns. Past performance is not a reliable indicator of future performance. Returns are gross of applicable fees, costs and taxes.

Source: Hyperion Asset Management.

What does persistent
outperformance look like?

This chart illustrates the magic of compounding superior returns after fees. Since October 1996, the Hyperion Broad-Cap Equities Composite has returned substantially more than S&P/ASX 300 Accumulation Index (after assumed fees of 0.95% per annum).

As at 31 March 2019, this strong long-term investment performance of the Hyperion Broad-Cap Equities Composite equates to average excess returns above the benchmark of 4.3% pa (pre-fees) over almost 23 years.

Applying the same investment process and philosophy to all our funds, Hyperion has produced net alpha since inception across its three key products. This isn’t a coincidence, it’s the result of our rigorous and meticulous investment research process.

Since October 2002, the Hyperion Small Growth Companies Fund has produced average alpha of 10.0% pa (pre-fees) and 7.9% pa (after fees).

Since inception in May 2014, the Hyperion Global Growth Composite has produced 9.9% pa alpha (pre-fees) and 7.7% pa (after fees).

This strong long-term performance has resulted in a ranking of first and second in the Morningstar league tables across Australian Equities and Small Cap Equities respectively over the 10 years to 30 June 2018. In addition, the Hyperion Global Growth Composite is currently ranked first over the longest relevant period (3 years) in the Global Equities category.

Awards We've Received

The Australian Fund Manager Foundation Awards 2018

Best Australian Based Global Equity Manager

Morningstar Awards 2016

Australian Fund Manager of the Year

Morningstar Awards 2016

Large Caps Category Winner

Morningstar Awards 2016

Small Caps Category Winner

What others say about us

With a track record spanning two decades, Hyperion manages $6 billion across its domestic small caps, domestic large caps and global growth funds. The global fund ranked number 1 in the last Morningstar survey and was issued a “recommended” rating from Zenith in February.

…highly successfully boutique fund manager Hyperion Asset Management."

Hyperion Global Growth Companies Fund

Growth of $100,000 invested at June 2014, as at 31 March 2019.

▬▬ Hyperion Global Growth Companies Fund

▬▬ Benchmark - MSCI World Index (AUD)

*Investment of $100K since June 2014, as at 31 March 2019. Returns are net of applicable fees, costs and taxes.

Source: Hyperion Asset Management.

Make It Happen

Invest in our unit trusts


Limited Window

Hyperion’s small cap and broad cap products are currently at capacity with existing clients’ investments and are closed to new investors.

However, we currently have capacity for new clients in the Hyperion Global Growth Companies Fund, a fund comprised of our best investment picks from across the globe.

Established in 2014 but using the same process we’ve followed successfully since 1996, the fund has attracted much attention from superannuation funds, institutional investors, advisers, clients and the media.

Hyperion Australian Growth Companies Fund

Growth of $100,000 invested at September 2002, as at 31 March 2019.

▬▬ Hyperion Australian Growth Companies Fund

▬▬ Benchmark - S&P/ASX 300 Accumulation Index

*Investment of $100K since September 2002, as at 31 March 2019. Returns are net of applicable fees, costs and taxes.

Source: Hyperion Asset Management.

Your Future

Success comes from action


Remember the proverb “a thousand mile journey starts with a single step”?

What if you had started your investment journey in 1996 with $100,000 and at the time were tossing up between investing in Hyperion’s first product, the Hyperion Australian Growth Companies Fund, and an ASX 200 index?

If you’d chosen Hyperion, your investment would be worth over approximately $1.5 million today* while the index investment would be worth almost half that or $630,334. That’s a big difference in the sort of life you would be leading today. Perhaps a life that now includes early retirement, providing for your children’s futures or freedom to explore your passions.

And in another ten years' time perhaps you’ll wish you started investing today.

To your success.

To Your Success


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