Friday, May 30, 2014

Man 3 Eclipse Update

Back in 2008 I invested in a capital guaranteed managed futures fund called Man 3 Eclipse. This didn't turn out to be a great investment but it wasn't that disastrous either. However, other investors it seems have not been impressed by the fund's underperformance and have redeemed their shares. As the fund got smaller, late last year the directors decided to stop investing in active investment strategies and switch to 100% deposits in Australian Dollars. The fund was issued for a fixed period  maturing on 29 April 2016. A feature of the fund was a ratchet that locked in profits under some conditions. Currently the value at maturity is guaranteed to be at least $1.0554 for every dollar invested. The actual net asset value per share is $1.0414.If we assume that the fund will earn 2% per annum from now on then the value at maturity will be about $1.08. But my understanding is that if you redeem shares early then you only get $1. So this is a guaranteed 4% rate of return per year assuming they can earn 2%. The main negative possibility is that fees chew up the interest yield. If they do then we still get back at least $1.0554. Based on that I will keep my money in the fund. It's only $8,000 anyway...

So far, my investment in the Winton Global Alpha fund is much more successful. It's up about 5% since I invested.

Monday, May 05, 2014

New Investment

A new investment - Cadence Capital Limited - another Australian listed investment company that basically runs a hedge fund in listed structure. They have long and short investments, potentially leverage or net cash, performance fees - all the standard hedge fund features. And it is exchange traded and pays franked dividends... They use a combination of fundamental and technical analysis. Currently the fund is selling for slightly less than net asset value but has performed very well in the past. It has strongly outperformed the Australian index even after fees. Initial position is 10,000 shares, but imagine that will increase over time. I estimate alpha relative to the ASX 200 of 9.43%, which is really high. Beta is 0.75.

Thursday, May 01, 2014

Moomin Valley Monthly Report April 2014

I was just thinking this morning that we need to increase net worth by $3,000 each month now just to compensate for inflation. 

The Australian Dollar was pretty stable this month. The MSCI World Index rose 1.00%, the S&P 500, 0.74%, and the ASX200 1.77%. We gained 0.89% in US Dollar terms or 0.80% in Australian Dollar terms. So we beat the world markets but not the Australian stock market. Net worth rose $15k to $1.163 million in Australian Dollars or $US15k to $US1.080 million. The monthly accounts (in AUD now) follow:

Other income is income not from investments or retirement contributions. It was normal this month at $13.5k. Spending was very high this month at $9.8k but after adjustments it was an average $5.8k. We saved only $3.7k from regular income. 

We gained $9.2k on investments. The asset class that did best this month was real estate and the worst private equity.