ASSOCIATE GLOBAL PARTNERS LIMITED We are pleased to provide you with a summary report on the performance of the WCM Quality Global Growth Equity Strategy (the Strategy) in November 2022.
The Strategy1 delivered a return of -0.28% during the month, compared with the benchmark MSCI All Country World Index return of 2.93%. The Strategy has delivered returns in excess of the benchmark MSCI All Country World Index over three, five and 10 years, and since inception.
Notes: 1. WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) have the same Portfolio Managers and investment team, the same investment principles, philosophy, strategy and execution of approach as those used for the WCM Quality Global Growth Strategy however, it should be noted that due to certain factors including, but not limited to, differences in cash flows, management and performance fees, expenses, performance calculation methods, and portfolio sizes and composition, there may be variances between the investment returns demonstrated by each of these portfolios and the WCM Quality Global Growth Strategy Composite (the Composite) in the future. As WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) have only been in operation for a relatively short period of time, this table makes reference to the Composite to provide a better understanding of how the team has managed this strategy over a longer period. Performance is net of fees and includes the reinvestment of dividends and income. 2. Composite inception date is 31 March 2008. 3. Benchmark refers to the MSCI All Country World Index (with gross dividends reinvested reported in Australian Dollars and unhedged). 4. Value Added equals Composite Performance minus Benchmark performance. 5. Annualised.
The Strategy is conveniently available via four investment structures to accommodate the differing preferences of individual investors. You can read the full investment update for each of these products on the links below:
- WCM Global Growth Limited (ASX:WQG)
- WCM Quality Global Growth Fund (Quoted Managed Fund) (ASX:WCMQ)
- WCM Quality Global Growth Fund (Managed Fund) (Unhedged)
- WCM Quality Global Growth Fund (Managed Fund) (Hedged)
Global equity markets continued their rally from mid-October's lows, posting another strong month in November. While central banks including the US Federal Reserve and the Bank of England increased policy rates by 0.75%, lower-than-expected inflation numbers in the US provided investors with optimism that a slowdown in the monetary tightening cycle may be imminent. The likelihood that widespread lockdown protests in China and its commitment to higher vaccination rates would lead to a change to China's zero COVID-19 policy was another element contributing to the strength in markets. This more optimistic sentiment towards China was a factor behind the outperformance of emerging markets relative to developed markets over the course of the month. In terms of sectors, basic resources saw the largest gains while Energy and Health Care, two of the strongest sectors year to date, lagged the market. At a factor level, value outperformed growth. The Australian dollar was stronger in November, reducing the returns for unhedged portfolios.
Portfolio performance attribution analysis for the month showed that from a sector perspective, the largest positive contribution came from the zero allocation to Energy. Sector positioning weighing on performance included the underweight position in Materials and overweight exposure to Technology. Stock selection detracted from relative performance, most notably in the Technology, Financials and Industrial sectors. Stock selection was the strongest in the Consumer Staples sleeve of the portfolio.
The severe sell off in growth stocks over the past 12 months has presented many opportunities for the investment team at WCM. This has been particularly the case in the Technology sector where several names, previously considered too richly valued, have recently been added to the portfolio.
However, the new additions to the portfolio have not been limited to high-growth technology stocks only. Expanding moat business with aligned corporate cultures can be found in relatively less dynamic industries too. One such example and a recent addition to the portfolio is Illinois-based Arthur J Gallagher & Co (AJG) which operates in the boring but essential business of insurance brokerage. Its moat stems from sticky customer relationships, scale, service breadth and brand safety. AJG's moat is expanding via technology investments, compounding data and analytics expertise and ongoing merger and acquisition activity.
DISCLAIMER: AGP Investment Management Limited (AGP IM) (ABN 26 123 611 978, AFSL 312247) is a wholly owned subsidiary of Associate Global Partners Limited (AGP) (ABN 56 080 277 998), a financial institution listed on the ASX (APL). AGP IM has prepared this material for general information purposes only for WCM Global Growth Limited, a listed investment company (ASX: WQG).
AGP IM is the responsible entity for WCM Quality Global Growth Fund (Quoted Managed Fund) (ARSN 625 955 240) (ASX: WCMQ) and WCM Quality Global Growth Fund (Managed Fund) (ARSN 630 062 047).
Contango International Management Pty Limited (CIML) (ABN 33 617 319 123) is the investment manager for WQG and is an authorised representative of AGP IM. WCM Investment Management, LLC (WCM) is the underlying manager and applies its WCM Quality Global Growth Equity Strategy (the Strategy), excluding Australia, in managing each of WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund)(the Funds). WCM does not hold an AFSL. WQG and CIML are part of the AGP Group.
Any references to 'We', 'Our', 'Us', or the 'Team' used in the context of the portfolio commentary, is in reference to WCM Investment Management, as investment manager for the Strategy or CIML as investment manager for WQG.
Even though the Strategy, excluding Australia, is applied to each of WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) certain factors including, but not limited to, differences in cash flows, fees, expenses, performance calculation methods, portfolio sizes and composition may result in variances between the investment returns for each portfolio. The performance of the Strategy is not the performance of the portfolios and is not an indication of how WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) would have performed in the past or will perform in the future.
The material should not be viewed as a solicitation or offer of advice or services by WCM, AGP or AGP IM. It does not contain investment recommendations nor provide investment advice. It does not take into account the objectives, financial situation or needs of any particular individual. Investors should, before acting on this material, consider the appropriateness of the material.
Neither AGP IM, AGP, their related bodies corporate, entities, directors or officers guarantees the performance of, or the timing or amount of repayment of capital or income invested in the Funds or that the Funds will achieve its investment objectives. Past performance is not indicative of future performance.
Any economic or market forecasts are not guaranteed. Any references to particular securities or sectors are for illustrative purposes only and are as at the date of publication of this material. This is not a recommendation in relation to any named securities or sectors and no warranty or guarantee is provided that the positions will remain within the portfolio of the funds. Any securities identified and described are for illustrative purposes only and do not represent all of the securities purchased, sold or recommended for client accounts. The reader should not assume that an investment in the securities identified was or will be profitable.
Investors should seek professional investment, financial or other advice to assist the investor determine the individual tolerance to risk and needs to attain a particular return on investment. In no way should the investor rely on information contained in this material.
Investors should read the Product Disclosure Statements (PDS) of the Funds or any relevant offer document in full before making a decision to invest in these products.
WCM Quality Global Growth October 2022 NTA Statement & Portfolio Update
WCM Quality Global Growth September 2022 NTA Statement & Portfolio Update
Live Webinar | An update on the WCM Quality Global Growth Strategy
WCM Quality Global Growth August 2022 NTA Statement & Portfolio Update
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Contango Asset Management Limited published this content on 12 December 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 December 2022 23:02:01 UTC.
