Investment Process
Jaguar Funds aim to provide investors with risk-adjusted returns from the Australian stock market throughout a range of market cycles superior to and having a low correlation with major stock and bond indices.
The investment manager employs a Long Short equity strategy using the investment process MVRTM to exploit pricing inefficiencies between related securities. The company does not seek to capitalize on inherent speculation and will focus principally on companies within the Australian S&P/ASX100 Index.
MVR™ is used to screen for potential buys and short-sales worthy of a qualitative check. MVR™ is a sequentially based screening process, ranking stocks first on Earnings & Price Momentum, followed by Value and then by Return. An optimiser is used to screen for industry (GIC) exposure before selecting the portfolio. Growth, value adjustments may be made depending upon the market cycle at that time.
Central to the Investment Manager’s strategy is the active selection of appropriate stocks in which to invest (and the determination of how much to invest). The Investment Manager’s knowledge derived from experience in the Australian and International markets will assist in applying MVR™ and evaluating each opportunity on a risk return basis. The Investment Manager will perform a qualitative check on each potential investment as determined by MVR™
Factors relevant to the Investment Managers qualitative check in assessing stock specific risk and returns include:
Return Analysis: Is history a guide to the future? What is the trend in Return on Equity?
Operating Environment: Does the potential investment operate in an attractive industry or does it have a unique position?
Sustainability of Performance: What about mean reversion risk, changes in industry, world changes, and the pitfalls of success?
Investment opportunities: Are investments by the company likely to earn above the cost of capital and how is the company positioned regarding its capital expenditure cycle?
Management: Can management be relied upon, what are management objectives, performance and structural considerations?
Linkages to share price: What upside, downside potential is there in the share price, and what is the market already discounting?
The register of the company: Are insiders buying/selling and what are substantial shareholders doing?
Industry Classification: The relationship of a potential investment to other investments in the Portfolio?
Past performance is no indication of future results.
