Hyperion High Conviction Large Cap Report

Global equity indices fell sharply during December, as geopolitical concerns, a slowing Eurozone and global monetary tightening continued to weigh on markets. In the U.S., the S&P 500 returned -9.0% after the Federal Reserve raised its benchmark lending rate range by 25bps and the U.S. government entered a partial shutdown, following political disagreement on its federal funding plans. In Europe, the FTSE 100, Euro STOXX 50 and German DAX all finished lower, returning -3.5%, -5.2% and -6.2% respectively, after weeks of protests led French President Emmanuel Macron to announce fiscal stimulus measures which could see the country’s fiscal deficit exceed the European Union’s 3% limit. In addition, U.K. Prime Minister Theresa May postponed the parliamentary vote on her Brexit deal. Australia’s S&P/ASX 300 Accumulation Index was the best performing developed global index, returning -0.2%. Energy (+6.5%), materials (+6.1%), and communication services (+5.5%) were the best performing sectors, whilst utilities (-4.5%), industrials (-0.9%) and health care (-0.5%) were the worst performers. Global bond yields fell during December. Bulk commodity prices generally rose during the month, with thermal coal and iron ore prices trading higher.Coking coal and oil declined. The U.S. Dollar rose against most of the G10 currencies except against the Euro, Japanese Yen and Swedish Krona.

Market Outlook

Approaching the holiday period, December was a relatively quiet month in terms of portfolio news. Notably, Trade Me Group Limited (TME-AU) entered into an agreement under which funds advised by Apax Partners will acquire 100% of its shares for NZ$6.45 per share. As we move into 2019, the domestic market will set its focus on the upcoming February reporting season.

We remain confident that the companies in the portfolios will achieve attractive rates of revenue, EPS and DPS growth over the next five years, well ahead of the broader market.

Portfolio
(%)
    Benchmark*
(%)
Excess
Performance (%)
  1 month-3.37-0.23-3.14
  3 month-11.81-8.41-3.40
  1 year0.49-3.063.55
  3 years p.a.3.816.65-2.84
  5 years7.825.602.22
* Benchmark is the S&P/ASX 300 Accumulation Index.
Performance is gross of fees and expenses.
Past performance is not a reliable indicator of future performance

OBJECTIVE: MEDIUM TO LONG-TERM CAPITAL GROWTH AND INCOME BY INVESTING IN HIGH CALIBRE AUSTRALIAN COMPANIES PRIMARILY LISTED WITHIN THE S&P/ASX 300, AT THE TIME OF INVESTMENT.

 

 

 

Hyperion named AUSTRALIAN FUND MANAGER OF THE YEAR in the Morningstar 2016 Awards, Australia. 

The information in this document was prepared by Hyperion Asset Management Limited (‘Hyperion’), ABN 80 080 135 897 AFSL 238 380, for wholesale investors. The information is not intended as a securities recommendation or statement of opinion intended to influence a person or persons in making a decision in relation to investment. This document does not take account of any person’s objectives, financial situation or needs and before acting, an investor should consider the appropriateness of the investment having regard to their objectives, financial situation and needs. Any opinions or forecasts reflect the judgment and assumptions of Hyperion and its representatives on the basis of information at the date of publication and may later change without notice. This document is provided to the recipient only and must not be copied or passed on to any other person without the consent of Hyperion Asset Management Limited. Past performance is not an indicator or guarantee of future performance. Investment performance is presented gross of investment management fees and other expenses, including custody. Hyperion Asset Management Limited believes the information contained in this communication is reliable, however, no warranty is given as to its accuracy and persons relying on this information do so at their own risk. To the extent permitted by law, Hyperion disclaims all liability to any person relying on the information in respect of any loss or damage (including consequential loss or damage) however caused, which may be suffered or arise directly or indirectly in respect of such information contained in this communication. Figures provided as at 31st December 2018. Morningstar Awards 2016 (c). Morningstar, Inc. All Rights Reserved. Awarded to Hyperion Asset Management for Fund Manager of the Year, Domestic Equities – Large Caps Category Winner and Domestic Equities – Small Caps Category Winner, Australia.
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