The Fund of the Month based on our customers' investment choices in July 2010 was the Wholesale Imputation Fund from BT Investment Management.
Brokerage on this fund is discounted to 0.25% until 11am, 10 September 2010
We've asked BT Investment Management a few questions to learn more about the fund.
July 2010 snapshot of the Wholesale Imputation Fund's performance
The portfolio has been flat over the month because the market faces short-term cyclical headwinds, however the portfolio is positioned for growth in industrial, transport and logistics sector and will meet its dual objectives of capital growth and income over the coming period.
Our overweight position in Qantas was the main contributor to returns. The airline introduced a price rise during the month, vindicating the underlying strength of both the brand and the corporate travel market. The stock was also helped by Singapore airlines’ strong profit result reported during the month.
An underweight in Woolworths also contributed to performance over the month as the market reacted negatively to the retailer’s slower sales growth which was significantly weaker than its key competitor Coles reflecting a continuation of the resurgence in the Coles business.
The portfolio’s overweight in Westpac was another contributor to returns with favourable Basel III regulations and a successful US$3bn corporate bond issue seeing the stock perform strongly (+13.0%).
The main detractor over the month was the portfolio’s underweight in Intoll as the stock jumped on receiving a takeover offer. Another detractor to performance over the month was our overweight in NewsCorp. The stock outperformed our market in US dollar terms however it underperformed in Australian dollar terms (-1.1%) because of the strength of the $A over the month. We continue to believe that the core earnings growth outlook for NewsCorp remains strong driven by its core cable network businesses.
What is the investment objective of the fund?
The Fund aims to provide a return (before fees, costs and taxes) that exceeds the S&P/ASX 300 Accumulation Index over the medium to long term. The suggested investment timeframe is five years or more.
What is the investment strategy of the fund?
BTIM seeks to deliver consistently superior performance by exploiting investment opportunities that arise due to the inefficient market pricing of securities. Our goal is to invest in strong businesses that are generating cashflow, but are currently valued incorrectly by the market.
What is the asset allocation?
| Financials ex Property | 27.2% |
| Materials | 24.3% |
| Consumer Staples | 7.6% |
| Energy | 10% |
| Consumer Discretionary | 6.9% |
| Telecommunication Services | 4.4% |
| Industrials | 10.1% |
| Property Trusts | 4% |
| Health Care | 2.5% |
| Information Technology | 0.5% |
| Utilities | 0.2% |
| Cash and other | 2.3% |
More information
Download the fund profile for information on the fund's performance, investment style and more.
