https://pengana.com/wp-json/pen/performance?fund_code=PENVGT&date=30/09/2024&aggregation_code=Class%20A
CLOSE
BACK

OUR FUNDS

CLOSE

Axiom International Fund

An option of HEDGED or UNHEDGED portfolios of dynamic and growing companies undergoing positive change, within a robust ethical framework.

September 2024 - Monthly REPORT

September Report

SUMMARY

  • Global equities were volatile in September but ended the month higher in local currency terms as inflation continued to slow, bringing the prospect of a soft landing across the global economy.
  • The US began to reduce interest rates, while central banks of other developed economies made further cuts.
  • The Portfolio returned -1.5% in September, while the benchmark delivered +0.1%.

Join Fund Manager Bradley Amoils as he discusses the Fund’s current portfolio holdings, the factors influencing recent performance, and some of the market variables the investment team is considering moving forward. Register here.

PORTFOLIO

Top Holdings (alphabetically)

Alphabet Inc
United States
Communication Services
Alphabet Inc. operates as a holding company. The Company, through its subsidiaries, provides web-based search, advertisements, maps, software applications, mobile operating systems, consumer content, enterprise solutions, commerce, and hardware products.
Amazon.com Inc
United States
Consumer Discretionary
Amazon.com, Inc. is an online retailer that offers a wide range of products. The Company products include books, music, computers, electronics and numerous other products. Amazon offers personalized shopping services, Web-based credit card payment, and direct shipping to customers. Amazon also operates a cloud platform offering services globally.
Apple Inc
United States
Information Technology
Apple Inc. designs, manufactures, and markets personal computers and related personal computing and mobile communication devices along with a variety of related software, services, peripherals, and networking solutions. Apple sells its products worldwide through its online stores, its retail stores, its direct sales force, third-party wholesalers, and resellers.
Hitachi Ltd.
Japan
Industrials
Hitachi Ltd. engages in the manufacture and sale of electrical equipment. It operates through the following segments: Digital Systems & Services, Green Energy & Mobility and Connective Industries. The Digital Systems & Services segment includes digital solutions, IT products and ATM. The Green Energy & Mobility segment services includes energy solution and railway system. The Connective Industries segment services includes building systems, lifestyle, measurement and analysis systems, industrial and distribution solutions, water/environmental solutions and industrial equipment. The company was founded by Namihei Odaira in 1910 and is headquartered in Tokyo, Japan.
Meta Platforms Inc
United States
Communication Services
Meta Platforms, Inc. operates as a social technology company. The Company builds applications and technologies that help people connect, find communities, and grow businesses. Meta Platform is also involved in advertisements, augmented, and virtual reality.
Microsoft Corp
United States
Information Technology
Microsoft Corporation develops, manufactures, licenses, sells, and supports software products. The Company offers operating system software, server application software, business and consumer applications software, software development tools, and Internet and intranet software. Microsoft also develops video game consoles and digital music entertainment devices.
Netflix Inc
United States
Communication Services
Netflix, Inc. engages in providing entertainment services. It also offers activities for leisure time, entertainment video, video gaming, and other sources of entertainment. It operates through the United States and International geographic segments. The company was founded by Marc Randolph and Wilmot Reed Hastings on August 29, 1997 and is headquartered in Los Gatos, CA.
NVIDIA Corp
United States
Information Technology
NVIDIA Corporation designs, develops, and markets three dimensional (3D) graphics processors and related software. The Company offers products that provides interactive 3D graphics to the mainstream personal computer market.
Taiwan Semiconductor Manufactu
United States
Information Technology
Taiwan Semiconductor Manufacturing Company, Ltd. manufactures and markets integrated circuits. The Company provides the following services: wafer manufacturing, wafer probing, assembly and testing, mask production, and design services. TSMC's ICs are used in computer, communication, consumer electronics, automotive, and industrial equipment industries.
Visa Inc
United States
Financials
Visa Inc. operates a retail electronic payments network and manages global financial services. The Company also offers global commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities.

Sector Breakdown

Capitalisation Breakdown

Region Breakdown

PERFORMANCE

PERFORMANCE SINCE STRATEGY INCEPTION

NET PERFORMANCE FOR PERIODS ENDING 30 Sep 20246

Pengana Axiom International Fund

The Class was established in 1 July 2017. From June 2021 Axiom was appointed as the investment manager for the Fund.

1M 1Y 2Y 3Y
Since
Axiom Appointed
June 20211
5Y
Since Fund
Inception
July 20172
Since Strategy
Inception
July 20043
Fund: APIR (HOW0002AU)1,2

Managed by Axiom from June 2021
-1.5% 27.3% 23.6% 4.3% 9.0% 11.2% 10.8%
Current Strategy (Partial Simulation)4

Axiom Global Equity Strategy
12.7% 13.4% 8.6%
Index5 0.1% 22.5% 21.4% 9.6% 10.9% 11.6% 12.2% 8.2%

Swipe horizontally to see all columns

PERFORMANCE SINCE STRATEGY INCEPTION

NET PERFORMANCE SINCE INCEPTION6

COMMENTARY

Equity market volatility continued in September upon initial fears that the global economy was slowing faster than had been previously expected. Share prices rebounded later in the month after the US began to reduce interest rates, with further monetary easing in the Eurozone, Canada, Switzerland and Sweden.  Global equities ended the month higher in local currency terms but a weaker US dollar detracted from returns in Australian dollar terms.

Inflation continued to slow across the major developed economies. The US core Personal Consumption Expenditure (PCE) Price Index, an inflation measure closely watched by the Federal Reserve (Fed), accelerated slightly in August, although the headline measure fell. This is not expected to prevent the Fed reducing interest rates further in November and December. This helped push the US dollar down 0.9% relative to a basket of its major trading partners’ currencies in September. The US consumer remains resilient, with retail sales accelerating further in August.

Economic data in Europe was mixed, with Eurozone activity levels indicating that the economy was again contracting. However, European retail sales continued to accelerate, increasing 0.8% year-on-year in July.

Manufacturing activity levels in China signalled a return to contraction in August, as broader economic data in the country continued to disappoint investors. Consumer spending is sluggish, while the highly indebted property market remains a drag on economic growth.

The Fund continues to overweight information technology, consumer discretionary and communication services, while underweighting financials, materials and energy. Strong stock performance in industrials, the overweight position in consumer discretionary and the zero weighting to energy drove relative returns. However, this was offset by weaker stock performance in consumer discretionary and information technology.

The Fund’s strongest contributor to relative returns in September was its overweight position in the US-based provider of critical infrastructure for data centres and communication networks, Vertiv. It rebounded upon the announcements of data centre capacity expansion.

US-based multinational technology group Meta Platforms also contributed to relative returns during September, when intra-quarter advertising spending continued to track ahead of earlier expectations.

Japan-based multinational Hitachi, which has large digital systems, power and renewable energy businesses, also outperformed. This reflected accelerating electricity consumption by AI-driven data centres and increasing investment in electricity grids globally.

The Fund’s overweight positions in Denmark-based Novo Nordisk and US-based Eli Lilly detracted from relative returns. The pharmaceutical giants underperformed after weekly pharmacy script data for GLP-1 weight-loss drugs slowed in September.

Netherlands-based ASML, which supplies manufacturers of advanced semiconductors with extreme ultraviolet lithography (EUV) photolithography machines, also detracted from relative returns. This followed chip makers Intel and Samsung Electronics, both large spenders on the wafer fab equipment used in semiconductor manufacturing, reducing their capital expenditure.

The Fund trimmed its positions in the stock and also reduced its holding in Japan-based technology company Tokyo Electron due to falling capital investment in wafer fab equipment. Weak demand in global smartphone and PC markets are expected to further curtail their customers’ 2025 capital expenditure.

The Fund increased its position in Hitachi, as analysis of global power demand from the buildout of AI infrastructure indicated that Hitachi’s market opportunity is underestimated. The company’s power grid business is well positioned to exceed current consensus earnings expectations, justifying a higher exposure to the stock in the Portfolio.

US-based Equinix is a global data centre and interconnection services provider that offers space, power, connectivity, security and support to its customers. We expect data centre demand to remain robust as it continues to benefit from ongoing AI innovation.

US-based TJX Companies is the largest global off-price retailer, whose brands include TK Maxx in Australia. We believe that it can benefit from secular growth as it expands in the US and internationally by increasing market share and growing volumes. TJX should benefit from ongoing retail disruption as consumers pivot to value outlets and higher borrowing costs impact more indebted retailers.

The Fund exited its remaining position in e.l.f. Beauty, as tracked channel data continued to indicate demand growth was falling below market expectations.

The position in Dutch technology group STMicroelectronics was fully exited, as the Fund selectively reduced its semiconductor exposure. Furthermore, its auto exposure appears less attractive following profit-warnings across the industry.

MSCI upgraded the ESG rating of Mexican multinational beverage and retail company Femsa to ‘AA’ from ‘A’. This reflects changes in the company’s leadership, which addresses concerns regarding the influence of controlling shareholders.

MSCI also upgraded Japan-based industrial group Keyence to ‘A’ from ‘BBB’ following improvements in its corporate governance practices which are now in-line with those of its global peers. A remuneration and nominations committee was established in September, which is expected to bolster the oversight of executive pay practices and board succession planning.

PROFILE

Platform Availability

  • Asgard eWrap
  • BT Investment Wrap
  • BT Panorama
  • BT Superwrap
  • Colonial First Wrap -IDPS
  • Centric IDPS
  • Hub24
  • IOOF Grow Wrap
  • Macquarie Wrap -IDPS
  • Macquarie Wrap -Super
  • Mason Stevens – IDPS
  • Mason Stevens – Super (Hedged)
  • Netwealth
  • Powerwrap

STATISTICAL DATA2

PORTFOLIO SUMMARY
VOLATILITY7
13.2%
NUMBER OF STOCKS
43
BETA8
0.96

FEATURES

  • APIR CODE HOW0002AU
  • REDEMPTION PRICEA$ 3.5635
  • FEES * Management Fee: 1.35% p.a
  • Minimum initial investment $10,000
  • FUM AT MONTH END A$ 342.73m
  • STRATEGY INCEPTION DATE 1 July 2004
  • BenchmarkMSCI All Country World Total Return Index (net, AUD)

Fund Managers

Bradley Amoils

Managing Director/Portfolio Manager

Andrew Jacobson

CEO/Chief Investment Officer

Description

The Pengana Axiom International Fund invests in companies that are dynamically growing and changing for the better, more rapidly than generally expected and where the positive changes are not yet reflected in expectations or valuation.

The Global Equity Strategy seeks dynamic growth by concentrating its investments in global developed markets, and may also invest in companies located in emerging markets.

The investment manager is Axiom Investors, a Connecticut-based global equity fund manager formed in 1998 with over US$19billion in assets under Management.

EXPLORE OUR FUNDS

Harding Loevner International Fund
Harding Loevner International Fund
Axiom International Fund
Axiom International Fund
Axiom International Fund (Hedged)
Axiom International Fund (Hedged)
Australian Equities Fund
Australian Equities Fund
High Conviction Property Securities Fund
High Conviction Property Securities Fund
Global Small Companies Fund
Global Small Companies Fund
WHEB Sustainable Impact Fund
WHEB Sustainable Impact Fund
Emerging Companies Fund
Emerging Companies Fund
High Conviction Equities Fund
High Conviction Equities Fund
Pengana International Equities Limited (ASX: PIA)
Pengana International Equities Limited (ASX: PIA)
Private Equity Trust (ASX: PE1)
Private Equity Trust (ASX: PE1)
Pengana Global Private Credit Trust (ASX:PCX)
Pengana Global Private Credit Trust (ASX:PCX)
Alpha Israel Fund
Alpha Israel Fund
Pengana Diversified Private Credit Fund
Pengana Diversified Private Credit Fund

Prior to June 2021, the Axiom Global Equity Strategy performance (shown in the shaded area) includes the strategy performance simulated by Pengana from the monthly gross returns of the Axiom Global Equity strategy. This simulation was done by: 1) the conversion of US-denominated gross returns to AUD, 2) applying the fee structure of the stated class. The simulation does not include the Pengana ethical screen. From June 2021 the strategy performance is the performance of the Pengana Axiom International Ethical Fund.

1. Axiom was appointed fund manager as of 5 May 2021. June 2021 represents the first full month of Axiom managing the Fund.
2. Inception date 1 July 2017. Figures shown are calculated from the continuous performance of both the current and previous strategies. For performance see row labelled Fund: APIR (HOW0002AU) in the table above which is the continuous performance of both the current and previous strategies.
3. Axiom Global Equity Strategy inception 1 Jul 2004.
4. Prior to June 2021, the Axiom Global Equity Strategy performance (labeled ‘Strategy (Partial Simulation)’ and shown in the shaded area) includes the strategy performance simulated by Pengana from the monthly gross returns of the Axiom Global Equity strategy. This simulation was done by: 1) the conversion of US-denominated gross returns to AUD, 2) applying the fee structure of the stated class. The simulation does not include the Pengana ethical screen. From June 2021 the strategy performance is the performance of the Pengana Axiom International Ethical Fund.
5. MSCI All Country World Total Return Index in AUD.
6. Performance for periods greater than 12 months are annualised. Net performance figures are shown after all fees and expenses, and assume reinvestment of distributions. No allowance has been made for buy/sell spreads. Please refer to the PDS for information regarding risks. Past performance is not a reliable indicator of future performance, the value of investments can go up and down.
7. Annualised standard deviation since inception.
8. Relative to the MSCI All Country World Total Return Index in AUD.
*For further information regarding fees please see the PDS available on our website.