attachment/02645b79 3005 4874 afa5 11e0c0299497
Walter Scott Global Equity Fund Macquarie Professional Series George Dent Client Investment Manager Murdo Maclean Investment Manager October 2016
FOR LICENSED ADVISER USE ONLY - NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Important information
This information is confidential and is provided to licensed financial advisers, professional investors and investment researchers only. It is not to be distributed to, or disclosed to, retail clients. This information has been prepared by Macquarie Investment Management Australia Limited (ABN 55 092 552 611 AFSL 238321) (Macquarie), the issuer of units in the Funds referred to in this presentation (collectively the ‘Funds’). Macquarie has appointed Walter Scott & Partners Limited (Walter Scott) as investment manager of the Walter Scott Global Equity Fund and the Walter Scott Emerging Markets Fund. Walter Scott is an investment management firm authorised and regulated in the United Kingdom by the Financial Conduct Authority in the conduct of investment business. Walter Scott is a wholly-owned subsidiary of The Bank of New York Mellon Corporation. The Walter Scott Global Equity Fund (Hedged) (Hedged Fund) invests in the Walter Scott Global Equity Fund, managed by Walter Scott. Macquarie Investment Management Global Limited (ABN 90 086 159 060 AFSL 237843), part of Macquarie Investment Management, implements the currency hedging for the Hedged Fund. The information in this presentation is provided for general information purposes only and is not, and should not be construed as, an advertisement, an invitation, an offer, a solicitation of an offer or a recommendation to participate in any investment strategy or take any other action, including to buy or sell any product or security or offer any banking or financial service or facility by any member of the Macquarie Group. This presentation has been prepared without taking into account any person’s objectives, financial situation or needs. Recipients should not construe the contents of this presentation as financial, investment or other advice. It should not be relied on in making any investment decision. In deciding whether to acquire or continue to hold an investment in a Fund, an investor should consider the Fund’s product disclosure statement. The product disclosure statement is available on our website at macquarie.com.au/pds or by contacting us on 1800 814 523.
Past performance information is for illustrative purposes only and is not a reliable indicator of future performance. Future results are impossible to predict. This presentation may contain opinions, conclusions, estimates and other forward-looking statements which are, by their very nature, subject to various risks and uncertainties. Actual events or results may differ materially, positively or negatively, from those reflected or contemplated in such forward-looking statements. In preparing this presentation, reliance may have been placed, without independent verification, on the accuracy and completeness of information available from external sources. To the maximum extent permitted by law, no member of the Macquarie Group nor its directors, employees or agents accept any liability for any loss arising from the use of this presentation, its contents or otherwise arising in connection with it. Other than Macquarie Bank Limited (MBL), none of the entities noted in this presentation are authorised deposit-taking institutions for the purposes of the Banking Act 1959 (Commonwealth of Australia). The obligations of these entities do not represent deposits or other liabilities of MBL. MBL does not guarantee or otherwise provide assurance in respect of the obligations of these entities, unless noted otherwise.
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 2
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PAGE 3
Portfolio update Research insights - Japan
FOR LICENSED ADVISER USE ONLY - NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Why Walter Scott?
Long-term investing
High quality companies
Investment experience
Potential for long-term compound returns
Focus on quality companies with high earnings growth
Stable investment team with deep experience
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 6
Walter Scott Global Equity Fund performance As at 30 September 2016
Walter Scott Global Equity Fund (net) %
MSCI World ex Australia %
Year to date
1.5
0.2
Q3 2016
0.0
2.0
One year
2.8
1.9
2015*
13.1
11.8
Three years
12.2
13.4
Five years
15.4
17.3
Ten years
5.7
4.2
Since inception (21 March 2005)
7.3
5.9
Simple return
Compound annual growth rate
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI. Portfolio figures are shown net of fees. Past performance is not a reliable indicator of future performance. *For period from 1 January to 31 December.
PAGE 7
Walter Scott Global Equity Fund attribution Contributors and detractors for the quarter
Company
Sector
Country
Health care main relative detractor on sector level
Top five Komatsu
Industrials
Japan
EOG Resources
Energy
US
Shin-Etsu Chemical Materials
Japan
Taiwan Semiconductor
IT
Taiwan
Adobe
IT
US
Novo Nordisk
Health Care
Denmark
Cognizant Technology Solutions
IT
US
Tractor Supply
Consumer Discretionary
US
CR Bard
Health Care
US
Roche
Health Care
US
Tractor Supply, largest operator of retail farm stores in US, purchased in August
Bottom five
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI, Factset.
PAGE 8
Walter Scott Emerging Markets Fund performance As at 30 September 2016
Walter Scott Emerging Markets Fund (net) %
MSCI Emerging Markets Index %
Year to date
12.2
10.3
Q3 2016
3.3
6.1
One year
13.5
7.2
2015*
0.6
- 4.3
Three years
5.9
6.3
Since inception (23 June 2011)
6.5
4.8
Simple return
Compound annual growth rate
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI. Portfolio figures are shown net of fees. Past performance is not a reliable indicator of future performance. *For period from 1 January to 31 December.
PAGE 9
Walter Scott Emerging Markets Fund attribution Contributors and detractors for the quarter
Consumer Staples largest relative detractor • Overweight sector • Stocks detracting from performance
Top Glove sold in January and repurchased in July - Walter Scott’s disciplined approach
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI, Factset.
Company
Sector
Country
Naver Corp
IT
South Korea
Largan Precision
IT
Taiwan
Aac Technologies
IT
Hong Kong
Tencent Holdings
IT
Hong Kong
Taiwan Semiconductor
IT
Taiwan
Infosys
IT
India
LG Household & Healthcare
Consumer Staples
South Korea
Universal Robina
Consumer Staples
Philippines
Hikma Pharmaceuticals
Health Care
UK
Want Want
Consumer Staples
Hong Kong
Top five
Bottom five
PAGE 10
Extended research trip - 2016 50 company meetings (12 owned) – from start-ups to large cap
Pipeline of investment ideas has never been stronger FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 11
Bottom-up investment approach Investment themes
1 3
Ageing and shifting consumption patterns
Supply chain disruption
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Walter Scott and Partners Ltd
2 4
‘Monozukuri’ and ‘Takumi’
Long-awaited consolidation
PAGE 12
Why Walter Scott?
Long-term investing
High quality companies
Investment experience
Potential for long-term compound returns
Focus on quality companies with high earnings growth
Stable investment team with deep experience
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 13
Investment Specialists Anthony Cochran VIC
Fred Guimbeau WA SA
Matthew Potter NSW ACT
National Sales Manager P (03) 9635 8306 M 0410 332 870 E [email protected]
Business Development Manager P (08) 9224 0695 M 0438 137 723 E [email protected]
Business Development Manager P (02) 8232 6443 M 0404 884 399 E [email protected]
Edmund Nasser QLD
Anastasios Moralis VIC TAS
Business Development Manager P (07) 3233 5092 M 0402 228 433 E [email protected]
James McCurley NSW ACT
Business Development Manager P (03) 9635 8311 M 0413 050 903 E [email protected]
Aristi Kitsakis VIC WA Adviser Relations Executive P (03) 9635 8272 E [email protected]
Sam Bishop QLD
Adviser Relations Executive P (02) 8232 7198 E [email protected]
Adviser Relations Executive P (07) 3233 5221 E [email protected]
Stephanie Pereira NSW
Michelle Nguyen VIC SA TAS
Adviser Relations Executive P (02) 8237 3045 E [email protected]
Adviser Relations Executive P (03) 9635 8045 E [email protected]
macquarie.com/advisers/managed-funds FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 15
Significant risks of the Funds Investment risk
The Fund has exposure to share markets. The risk of an investment in the Fund is higher than an investment in a typical bank account or fixed income investment. Amounts distributed to unitholders may fluctuate, as may the Fund’s unit price. The unit price may vary by material amounts, even over short periods of time, including during the period between a redemption request being made and the time the redemption unit price is calculated.
Market risk
Share markets can be volatile, and have the potential to fall by large amounts over short periods of time. The investments of the Fund are likely to have a broad correlation with share markets in general, and hence poor performance or losses in domestic and/or global share markets are likely to impact negatively on the overall performance of the Fund.
Concentration risk
The Fund may have exposure to a small number of key investments. This may result in the returns of the Fund being dependent on the returns of individual companies and industry sectors. This concentration of exposures may increase the volatility of the Fund’s unit price, and increase the risk of poor performance. It may also result in the Fund’s returns differing significantly from its benchmark.
International investments risk
The Fund invests in a range of international securities, and in companies that have exposure to a range of international economies. Global and country specific macroeconomic factors may impact the Fund’s international investments. Governments may intervene in markets, industries, and companies; may alter tax and legal regimes; and may act to prevent or limit the repatriation of foreign capital. Such interventions may impact the Fund’s international investments.
Security specific risk
Securities and the companies that issue them are exposed to a range of factors that affect their individual performance. These factors may cause an investment’s return to differ from that of the broader market. The Fund may therefore underperform the market and/or its peers due to its security specific exposures.
Emerging market risk (Applicable for Walter Scott Emerging Markets Fund only)
The Fund has exposure to emerging markets. Emerging markets are generally considered riskier than developed markets due to factors such as lower liquidity, the potential for political unrest, the increased likelihood of sovereign intervention (including default and currency intervention), currency volatility, and increased legal risk. Emerging market investments therefore may experience increased asset price volatility, and face higher currency, default and liquidity risk.
More information on the risks of investing in a Fund is contained in the relevant Product Disclosure Statement, which should be considered before deciding to invest in a Fund.
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 17
FOR LICENSED ADVISER USE ONLY - NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Important information
This information is confidential and is provided to licensed financial advisers, professional investors and investment researchers only. It is not to be distributed to, or disclosed to, retail clients. This information has been prepared by Macquarie Investment Management Australia Limited (ABN 55 092 552 611 AFSL 238321) (Macquarie), the issuer of units in the Funds referred to in this presentation (collectively the ‘Funds’). Macquarie has appointed Walter Scott & Partners Limited (Walter Scott) as investment manager of the Walter Scott Global Equity Fund and the Walter Scott Emerging Markets Fund. Walter Scott is an investment management firm authorised and regulated in the United Kingdom by the Financial Conduct Authority in the conduct of investment business. Walter Scott is a wholly-owned subsidiary of The Bank of New York Mellon Corporation. The Walter Scott Global Equity Fund (Hedged) (Hedged Fund) invests in the Walter Scott Global Equity Fund, managed by Walter Scott. Macquarie Investment Management Global Limited (ABN 90 086 159 060 AFSL 237843), part of Macquarie Investment Management, implements the currency hedging for the Hedged Fund. The information in this presentation is provided for general information purposes only and is not, and should not be construed as, an advertisement, an invitation, an offer, a solicitation of an offer or a recommendation to participate in any investment strategy or take any other action, including to buy or sell any product or security or offer any banking or financial service or facility by any member of the Macquarie Group. This presentation has been prepared without taking into account any person’s objectives, financial situation or needs. Recipients should not construe the contents of this presentation as financial, investment or other advice. It should not be relied on in making any investment decision. In deciding whether to acquire or continue to hold an investment in a Fund, an investor should consider the Fund’s product disclosure statement. The product disclosure statement is available on our website at macquarie.com.au/pds or by contacting us on 1800 814 523.
Past performance information is for illustrative purposes only and is not a reliable indicator of future performance. Future results are impossible to predict. This presentation may contain opinions, conclusions, estimates and other forward-looking statements which are, by their very nature, subject to various risks and uncertainties. Actual events or results may differ materially, positively or negatively, from those reflected or contemplated in such forward-looking statements. In preparing this presentation, reliance may have been placed, without independent verification, on the accuracy and completeness of information available from external sources. To the maximum extent permitted by law, no member of the Macquarie Group nor its directors, employees or agents accept any liability for any loss arising from the use of this presentation, its contents or otherwise arising in connection with it. Other than Macquarie Bank Limited (MBL), none of the entities noted in this presentation are authorised deposit-taking institutions for the purposes of the Banking Act 1959 (Commonwealth of Australia). The obligations of these entities do not represent deposits or other liabilities of MBL. MBL does not guarantee or otherwise provide assurance in respect of the obligations of these entities, unless noted otherwise.
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 2
View in full screen
1
Move mouse over slide and select the Full Screen button.
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
2
To close the full screen, click the two arrows at bottom right.
PAGE 3
Portfolio update Research insights - Japan
FOR LICENSED ADVISER USE ONLY - NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Why Walter Scott?
Long-term investing
High quality companies
Investment experience
Potential for long-term compound returns
Focus on quality companies with high earnings growth
Stable investment team with deep experience
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 6
Walter Scott Global Equity Fund performance As at 30 September 2016
Walter Scott Global Equity Fund (net) %
MSCI World ex Australia %
Year to date
1.5
0.2
Q3 2016
0.0
2.0
One year
2.8
1.9
2015*
13.1
11.8
Three years
12.2
13.4
Five years
15.4
17.3
Ten years
5.7
4.2
Since inception (21 March 2005)
7.3
5.9
Simple return
Compound annual growth rate
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI. Portfolio figures are shown net of fees. Past performance is not a reliable indicator of future performance. *For period from 1 January to 31 December.
PAGE 7
Walter Scott Global Equity Fund attribution Contributors and detractors for the quarter
Company
Sector
Country
Health care main relative detractor on sector level
Top five Komatsu
Industrials
Japan
EOG Resources
Energy
US
Shin-Etsu Chemical Materials
Japan
Taiwan Semiconductor
IT
Taiwan
Adobe
IT
US
Novo Nordisk
Health Care
Denmark
Cognizant Technology Solutions
IT
US
Tractor Supply
Consumer Discretionary
US
CR Bard
Health Care
US
Roche
Health Care
US
Tractor Supply, largest operator of retail farm stores in US, purchased in August
Bottom five
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI, Factset.
PAGE 8
Walter Scott Emerging Markets Fund performance As at 30 September 2016
Walter Scott Emerging Markets Fund (net) %
MSCI Emerging Markets Index %
Year to date
12.2
10.3
Q3 2016
3.3
6.1
One year
13.5
7.2
2015*
0.6
- 4.3
Three years
5.9
6.3
Since inception (23 June 2011)
6.5
4.8
Simple return
Compound annual growth rate
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI. Portfolio figures are shown net of fees. Past performance is not a reliable indicator of future performance. *For period from 1 January to 31 December.
PAGE 9
Walter Scott Emerging Markets Fund attribution Contributors and detractors for the quarter
Consumer Staples largest relative detractor • Overweight sector • Stocks detracting from performance
Top Glove sold in January and repurchased in July - Walter Scott’s disciplined approach
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Source: Walter Scott, MSCI, Factset.
Company
Sector
Country
Naver Corp
IT
South Korea
Largan Precision
IT
Taiwan
Aac Technologies
IT
Hong Kong
Tencent Holdings
IT
Hong Kong
Taiwan Semiconductor
IT
Taiwan
Infosys
IT
India
LG Household & Healthcare
Consumer Staples
South Korea
Universal Robina
Consumer Staples
Philippines
Hikma Pharmaceuticals
Health Care
UK
Want Want
Consumer Staples
Hong Kong
Top five
Bottom five
PAGE 10
Extended research trip - 2016 50 company meetings (12 owned) – from start-ups to large cap
Pipeline of investment ideas has never been stronger FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 11
Bottom-up investment approach Investment themes
1 3
Ageing and shifting consumption patterns
Supply chain disruption
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
Walter Scott and Partners Ltd
2 4
‘Monozukuri’ and ‘Takumi’
Long-awaited consolidation
PAGE 12
Why Walter Scott?
Long-term investing
High quality companies
Investment experience
Potential for long-term compound returns
Focus on quality companies with high earnings growth
Stable investment team with deep experience
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 13
Investment Specialists Anthony Cochran VIC
Fred Guimbeau WA SA
Matthew Potter NSW ACT
National Sales Manager P (03) 9635 8306 M 0410 332 870 E [email protected]
Business Development Manager P (08) 9224 0695 M 0438 137 723 E [email protected]
Business Development Manager P (02) 8232 6443 M 0404 884 399 E [email protected]
Edmund Nasser QLD
Anastasios Moralis VIC TAS
Business Development Manager P (07) 3233 5092 M 0402 228 433 E [email protected]
James McCurley NSW ACT
Business Development Manager P (03) 9635 8311 M 0413 050 903 E [email protected]
Aristi Kitsakis VIC WA Adviser Relations Executive P (03) 9635 8272 E [email protected]
Sam Bishop QLD
Adviser Relations Executive P (02) 8232 7198 E [email protected]
Adviser Relations Executive P (07) 3233 5221 E [email protected]
Stephanie Pereira NSW
Michelle Nguyen VIC SA TAS
Adviser Relations Executive P (02) 8237 3045 E [email protected]
Adviser Relations Executive P (03) 9635 8045 E [email protected]
macquarie.com/advisers/managed-funds FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 15
Significant risks of the Funds Investment risk
The Fund has exposure to share markets. The risk of an investment in the Fund is higher than an investment in a typical bank account or fixed income investment. Amounts distributed to unitholders may fluctuate, as may the Fund’s unit price. The unit price may vary by material amounts, even over short periods of time, including during the period between a redemption request being made and the time the redemption unit price is calculated.
Market risk
Share markets can be volatile, and have the potential to fall by large amounts over short periods of time. The investments of the Fund are likely to have a broad correlation with share markets in general, and hence poor performance or losses in domestic and/or global share markets are likely to impact negatively on the overall performance of the Fund.
Concentration risk
The Fund may have exposure to a small number of key investments. This may result in the returns of the Fund being dependent on the returns of individual companies and industry sectors. This concentration of exposures may increase the volatility of the Fund’s unit price, and increase the risk of poor performance. It may also result in the Fund’s returns differing significantly from its benchmark.
International investments risk
The Fund invests in a range of international securities, and in companies that have exposure to a range of international economies. Global and country specific macroeconomic factors may impact the Fund’s international investments. Governments may intervene in markets, industries, and companies; may alter tax and legal regimes; and may act to prevent or limit the repatriation of foreign capital. Such interventions may impact the Fund’s international investments.
Security specific risk
Securities and the companies that issue them are exposed to a range of factors that affect their individual performance. These factors may cause an investment’s return to differ from that of the broader market. The Fund may therefore underperform the market and/or its peers due to its security specific exposures.
Emerging market risk (Applicable for Walter Scott Emerging Markets Fund only)
The Fund has exposure to emerging markets. Emerging markets are generally considered riskier than developed markets due to factors such as lower liquidity, the potential for political unrest, the increased likelihood of sovereign intervention (including default and currency intervention), currency volatility, and increased legal risk. Emerging market investments therefore may experience increased asset price volatility, and face higher currency, default and liquidity risk.
More information on the risks of investing in a Fund is contained in the relevant Product Disclosure Statement, which should be considered before deciding to invest in a Fund.
FOR LICENSED ADVISER USE ONLY NOT FOR DISTRIBUTION TO RETAIL INVESTORS
PAGE 17
