Research house Lonsec has awarded “Recommended” ratings to the Altius Bond Fund and the Altius Sustainable Bond Fund.
Both Funds seek to provide investors with regular income distributions while preserving capital. The Funds have the same benchmark and investment style; however, the Altius Sustainable Bond Fund also excludes companies from its investment universe if their primary business activity involves armaments, uranium, gambling, tobacco production, pornography, alcohol production, or production or sale of thermal coal.
The “Recommended” rating indicates that ““Lonsec has strong conviction the financial product can generate risk adjusted returns in line with relevant objectives. The financial product is considered an appropriate entry point to this asset class or strategy.”
In particular, Lonsec noted as strengths “the stability and experience of the team” and that the “Investment Advisory Board (IAC) adds value and weight to macro views”.
Lonsec also said in its review that: “The Funds seek to shift between cash and Australian bonds at various times during the cycle in an effort to protect capital. This product might be suited to investors who would like to effectively outsource the decision between cash and bonds to a fixed interest specialist or as an active satellite blended with a strategic allocation to defensive assets.
“Advisers should note the Manager has significantly greater leeway in duration positioning than more benchmark aware Australian Fixed Interest funds, so at times could outperform (or underperform) either Australian Bond funds or Australian Cash funds by a significant margin depending on its positioning.”
The review also commented on Altius’s joint venture with Australian Unity Investments:
“Similar to other boutique managers with institutional backing, Altius’ partnership with Australian Unity Investments provides it with a range of non-investment support services. This arrangement is beneficial for tightly run teams like Altius, allowing it to focus on core investment operations. Lonsec observes Australian Unity Investments adopts a ‘partner for life’ mentality, giving some comfort towards its commitment to the partnership.
“Despite being a boutique fund manager, Lonsec is pleased with the independent risk monitoring function performed by AUI. Lonsec believes post- trade compliance conducted by an external party can enhance the overall integrity of the process.”
Bill Bovingdon, chief executive officer of Altius, said that the rating underlines the role that bonds funds can play in investor portfolios.
“Investors continue to be concerned about how to generate yield and income in the current market environment, with volatility an ever-present issue.
“Well-managed, nimble bond funds have a useful role to play in helping create income throughout all market cycles.
“We are particularly pleased that Lonsec has recognised the flexibility of our approach to duration which is a key element of our investment philosophy,” Mr Bovingdon said.
Lonsec has also recently named the Altius Sustainable Bond Fund as a finalist in the innovation category of the Lonsec Awards. The winners will be announced as part of the 14th Annual Super Ratings Fund of Year Award being held on the 18th of October.
For more information please contact:
Mr Bill Bovingdon
Phone: 02 9112 4701
Altius Asset Management is a boutique fixed interest asset management business, responsible for more than $500 million in funds under management. The business was formed through a joint venture with Australian Unity in 2011.
The Altius Bond Fund and Altius Sustainable Bond Fund is issued by Australian Unity Funds Management Limited ABN 60 071 497 115, AFS Licence No. 234454. The information contained above is not based on the objectives, financial situation or needs of any particular investor. In deciding whether to acquire, continue to hold or dispose of the product you should obtain the Product Disclosure Statement available at australianunity.com.au/wealth or by calling our Investor Services team on 1300 590 488 and consider whether the product is appropriate for you. The information provided is current at the time of publication. Past performance is not a reliable indicator of future performance.
Investment decisions should not be made upon the basis of past performance or distribution rate or any ratings given by a rating agency, since each of these can vary. In addition ratings need to be understood in the context of the full report issued by the rating agency itself.
The Lonsec Ratings (assigned as follows: Altius Bond Fund— October 2016; Altius Sustainable Bond Fund— October 2016) presented in this document are published by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421445. The Ratings are limited to “General Advice” (as defined in the Corporations Act 2001 (Cth)) and based solely on consideration of the investment merits of the financial products. Past performance information is for illustrative purposes only and is not indicative of future performance. They are not a recommendation to purchase, sell or hold Australian Unity Funds Management’s (Fund Manager) products, and you should seek independent financial advice before investing in these products. The Ratings are subject to change without notice and Lonsec assumes no obligation to update the relevant documents following publication. Lonsec receives a fee from the Fund Manager for researching the products using comprehensive and objective criteria. For further information regarding Lonsec’s Ratings methodology, please refer to our website at: http://www.beyond.lonsec.com.au/intelligence/lonsec.