February 2026 Report

The Australian Dollar rose from USD 0.6989 to USD 0.7116 meaning that USD investment returns are better than AUD investment returns. Stock markets mostly rose (total returns including dividends):

US Dollar Indices

MSCI World Index (gross): 1.31%

S&P 500: -0.76%

HFRI Hedge Fund Index: 0.41% (forecast)

Australian Dollar Benchmarks

ASX 200: 4.33%

Target Portfolio: -0.17% (forecast - depends on HFRI result).

Australian 60/40 benchmark: 1.27%

In currency neutral terms we gained 1.31%. But in Australian Dollar terms we lost 0.33% and in US Dollar terms we gained 1.48%. So we beat the USD benchmarks but underperformed the AUD benchmarks. We were quite close to the target portfolio. It was the first down month for the S&P 500 since April 2025! February is a seasonally negative month for both the S&P 500 and our own portfolio.

The target portfolio has been flat for several months now as the rise in the Australian Dollar and.a fall in venture capital offset gains in other asset classes:

The SMSF underperformed, losing 1.83%. Unisuper  returned 0.92% and PSS(AP) 1.37%. 

Here is a report on the performance of investments by asset class:

The asset class returns are in currency neutral terms as the rate of return on gross assets and do not include investment expenses such as margin interest, and so the total differs from the Australian Dollar returns on net assets mentioned above. Performance was very mixed with a huge rate of return for futures. Hedge funds slightly edged futures out in terms of contribution. Gold had the worst rate of return and detracted the most.

Things that worked well this month:

• Four investments made more than AUD 10k: L1 Global Long Short (GLS.AX, 26k), Tribeca Global Resources (TGF.AX, 22k), Australian Dollar Futures (14k), Winton Global Alpha (11k). Eleven investments hit new high profit marks including GLS, TGF, and Winton. For TGF the previous peak was in 2022. Cadence Opportunities hit a new peak, with the previous peak in 2021!

What really didn't work:

• Three investments lost more than AUD 10k: Pershing Square Holdings (PSH.L, 24k), gold (15k), and Regal Investment Fund (RF1.AX, 15k). Because of timing issues, the price of the PMGOLD gold ETF fell, while the price of gold rose in US Dollar terms for the month. This wasn't because of the rise in the Australian Dollar. The USD price of gold when converted into AUD rose from AUD 7,000 to AUD 7,413! Ratherm there was a 9% fall in the USD price of gold on the last day of January. But the ASX closed before that happened.

We moved towards our target allocation. Our actual allocation currently looks like this:

 

About 68% of our portfolio is in what are often considered to be alternative assets: real estate, art, hedge funds, private equity and credit, gold, and futures. A lot of these are listed investments or investments with daily liquidity, so our portfolio is not as illiquid as you might think.

Moominmama receives employer superannuation contributions every two weeks. We also make monthly concessional contributions to Moominmama's superannuation to reach the annual cap on contributions. There will still be capital calls from Aura Venture Fund II and III. I am receiving monthly pension payments from both Unisuper and our SMSF totalling AUD 5,150 per month. I made non-concessional contributions of AUD 30k Unisuper and AUD 20k to our SMSF. I am thinking to max out the total possible contributions before I probably hit the transfer balance cap at the end of this financial year and can't make any further non-concessional contributions. There is a twist that complicates things. The transfer balance cap is expected to be raised by AUD 100k next year. I was very active in the market, making the following investment and trade moves this month:

• I bought 5k shares of Regal Partners (RPL.AX) on a dip.
• I bought 10k shares of Hearts and Minds (HM1.AX) on the same dip in the market. 
• I bought 4k shares of WAM Capital (WAM.AX) to round out our position to 110k. This was funded really from the gain in our Australian Dollar Futures. When futures rise, the cash in your account increases and vice versa...
• I bought 10k more shares of Cadence Opportunities (CDO.AX). 
• I did two profitable trades in gold and used the proceeds to buy 5k shares of Wilson Alternative Assets (WMA.AX). This should help rebalance our portfolio a little towards real assets. Then I did an unprofitable trade in gold...
• I sold 50 shares of Berkshire Hathaway (BRK/B). I'm a bit disappointed that it is below where I bought it in last year's market correction. This helped rebalance our portfolio a little away from US stocks. 
• I sold 1,000 shares of the ASX 200 ETF, IOZ.AX. This helped rebalance our portfolio towards the target portfolio and together with the BRK/B sale fund the following: 
• I bought 2000 shares of ZIM. I was planning on this being a longer term trade, but I ended up getting out after one day!
• So, instead I bought 500 additional shares of Pershing Square Holdings (PSH.L). 
• I sold more than 23k shares of Regal Investment Fund (RF1.AX). The market price was near the NAV now.
• I then bought 350k shares of the US Residential Property Fund, URF.AX. They now say that they will try to sell all property by the end of the year. This should close the gap between NAV and the market price. Risk is that the Australian Dollar rises a lot in the interim reducing NAV. This also helped rebalance the porfolio.
• I also bought just over 10k shares of the Cordish-Dixon Private Equity Fund III (CD3.AX). I liked the recent presentation on fund performance and think it is really undervalued. 
• I invested USD 3,750 in another start up with Unpopular Ventures.
• I made a new investment in 500 shares of the Alerian MLP ETF. This also helped rebalance towards real assets.

Here are the income and spending accounts * for this month:

Other income includes Moominmama's salary, a refund Moominpapa received and employer superannuation contributions. There was a larger than normal transfer into superannuation as I made the non-concessional contributions mentioned above. Spending was almost AUD 30k. This was the highest monthly spend since January 2015 when we bought our house and paid stamp duty! This was a high month due to school fees and a big "professional" expenditure by Moominpapa. As a result dissaving was AUD 23k for the month, which is just at the 4% rule limit. Because we lost AUD 24k investing, net income was AUD -18k. As a result of all this, net worth decreased by AUD 49k to AUD 8.608 million.

* Results are shown separately for retirement and non-retirement accounts as well as housing, which nowadays doesn't have much activity. The grey shaded rows are additional notes. Total investment income is split into investment income before exchange rate moves and the contribution of exchange rates. Other income is non-investment income including salaries, employer superannuation contributions, and net tax returns. Investment income is shown pre-tax. Tax credits include franking credits on Australian Dividends and imputed tax on industry superannuation returns and and actual SMSF tax. These are taken away from investment income to get changes in actual net worth. Inheritances include gifts from relatives. Saving is from non-investment income, transfers, and inheritances.