Switzer Dividend Growth Fund April 2019 Portfolio Update

Investment Objective

The Switzer Dividend Growth Fund (SWTZ) is an income-focussed exchange traded managed fund with a mix of yield and quality companies. The objective of the fund is to generate an above-market yield while maximising franking where possible and to deliver capital growth over the long-term. We select companies that, in aggregate, generate sustainable dividend income. The fund is characterised by a strong and diverse portfolio of companies that exhibit good cash flows and strong business models.
Performance Summary

Over the past 12 months, SWTZ has paid a distribution yield of 7.5%, or 9.9% including franking credits. Distribution yield is calculated as the distributions received over the 12 months to 30 April 2019 relative to the price at the beginning of the period.

Given its focus on income and capital preservation, over the long term we expect SWTZ to marginally underperform in rising markets and marginally outperform in falling markets. The portfolio performed well over the month, being up 2.9% against a market move of 2.4%.

Portfolio Commentary

The targeted cash level in the fund is usually 1.5-2%. At 30 April, cash was below this target at around 0.9%. The fund paid a 4.54c distribution (fully franked) on 16 April. The ex-date for this distribution was 1 April.

Activity was modest over the month. We sold some of our holdings in CSL and Charter Hall Group, both at a substantial profit. We trimmed our holding in CBA after a jump in the share price. CBA is the only major bank that will not pay a dividend this result season (it paid one earlier in the year). We exited our position in Magellan Financial Group after a very strong upward move in the share price.

We also increased our position in Unibail-Rodamco-Westfield (ASX:URW) as the company appears to have stabilised and is showing improving underlying growth. URW is the owner of some of the world’s best shopping centres and the company has an attractive yield.

URW share price

Source: Bloomberg

We have also added Lendlease to the portfolio. The company is a blue-chip property developer and has a huge work book. Over the last year, several contracts in its road building division encountered problems resulting in large losses. The share price subsequently fell from over $21 to below $13 and we see this as an opportunity. Importantly, the balance sheet remains sound and management has taken the initiative to wind down or sell the road division. We have added a modest position and will monitor the company’s progress.

Source: Lendlease

Market Commentary

Global markets again mostly pushed higher over April, led by the bellwether NASDAQ index up 4.7%. The German and Japanese markets were also higher by 7.1% and 5.0% respectively.
Whilst the bond market rally seems to have stabilised, interest rates remain near historical lows. The US earnings season has commenced and looks to have a positive skew at this stage. The

Chinese economy appears to have stabilised with leading indicators starting to turn positive. All these factors combined are giving investors confidence that the world’s equity markets can continue to rally.

Sector performance was very tight with the best performing sector, Financials, being 1.4% higher while the poorest performer, Materials, was down 0.4%. The month was mainly about individual company share price performance.

The best performing company in the portfolio was Reliance Worldwide (ASX:RWC) (+13.2%). The company’s share price was recently affected by a sell down by the Chairman, but now appears to have worked through this issue. Reliance also continues to make headway in its operations in the US and UK.

Reliance share price

Source: Bloomberg

Other companies whose share prices performed well included Star Entertainment (+8.6%), Coles (+6.4%) and James Hardie (+6.3%). There were no companies in the portfolio whose prices fell more than -5% for the month.

Portfolio Outlook

Given the strong rally post the large falls back in December, markets now look close to fair value in our view. The ongoing rally in bond markets implies that future growth is unlikely to be strong and low interest rates are likely to persist. The fund will focus on secure yield and growth companies where valuations appear reasonable.
The underlying earnings (and dividend) outlook for the companies in the fund remains solid. Moreover, their balance sheets remain very strong. These are both positive signs of the health of the portfolio. The fund participated in the Caltex buyback and intends to participate in the Woolworths buyback. These buybacks will help sustain the level of franking in the fund.
Interest rates remain low and economic activity, although slowing, appears to have stabilised and remains positive. While volatility in equity markets is expected to continue, indications are that inflation will remain largely benign giving confidence that the investment outlook remains favourable.

[sc name="post-disclaimer-swtz"]

http://damai.balikpapan.go.id/assets/css/scatter-hitam/ https://scatterhitam-slot.com https://tth.com.tc/ https://gna.university/ https://guiqac.gnauniversity.edu.in/ http://tourism.gov.eg/ powergaming88 http://e-office.utu.ac.id/asset/assets/plugins/gacor/ powergaming88 powergaming88 powergaming88 powergaming88 powergaming88 powergaming88 powergaming88 powergaming88 slot zeus nolimit city sv388 https://pariamantimur.pariamankota.go.id/assets/ https://sipatudia.bpsdm.sumbarprov.go.id/assets/mahjong/ slot jepang http://simokata.tabanankab.go.id/dist/img/thailand/ scatter hitam slot thailand link slot thailand 777 slot powergaming88 slot luar negeri slot gacor maxwin slot gacor hari ini slot gacor terbaru mahjong ways 2 slot thailand jp slot slot bni slot bri slot bsi slot danamon slot gopay slot server korea slot malaysia slot amerika slot rusia fan tan monopoly live lightning roulette mega ball sweet bonanza candyland mega sic bo mega baccarat andar bahar sbobet88 ktm303 slot dubai slot qris powergaming88 Slot Thailand Slot Zeus Pg Soft Starlight Princess Slot Gacor Maxwin Joker123 Sv388 Slot Thailand Slot Thailand Slot Qris slot thailand joker123 mahjong ways 2 888slot slot jepang slot thailand slot mahjong ways slot qris slot deposit dana slot dana nolimit city slot thailand sv388 slot888 slot kamboja http://labse.ce.undip.ac.id/sejarah/gacorx/ Slot Thailand Starlight Princess Mahjong Ways 2 Slot Maxwin slot thailand slot filipina slot88 slot thailand slot mahjong NEW SLOT POLA GACOR https://mandiri-gacor.angkolatimur.tapselkab.go.id/ jp slot slot ganas https://cheat-gacor.angkolatimur.tapselkab.go.id/ crazy time live slot qris https://sqris.angkolatimur.tapselkab.go.id/ slot akurat qris https://pragmaticplay.dharmasatyasarana.co.id/ https://dana.sidamaju.skom.id/ https://joker123.putramuko.co.id/ https://akun-pro-rusia.mariyadl.sch.id/ slot zeus server thailand server hongkong slot ovo slot gopay slot linkaja joker123 nolimit city sv388 starlight princess mahjong ways pg slot slot zeus sv388 idn slot https://joker123.elearningmansatuokit.sch.id/ slot server thailand slot thailand https://slot-thailand.itr.ac.id/ https://pn-watansoppeng.go.id/media/jui/server-thailand/ https://dinkes.hsu.go.id/wp-content/uploads/server-thailand/ nolimit city slot ovo slot gopay pragmati play starlight princess slot pg soft slot mahjong slot zeus digmaan slot mania slot zeus server thailand ying77 slot thailand judi bola live casino sv388 pg soft slot dana mahjong ways slot mania slot x500 ladangtoto slot server kamboja digmaan digmaan slot88 scv388 sabung ayam online slot live casino sicbo online slot thailand ladangtoto sv388 ladangtoto powergaming88 66kbet powergaming88 slot thailand ladangtoto slot thailand server thailand slot thailand slot thailand slot thailand slot gacor ladangtoto2 ying77 bet server thailand slot thailand ying77 slot88 ladangtoto ladangtoto slot maxwin sv388 sv388 slot gacor 66k bet slot dana sabung ayam inline slot mahjong slot toto slot server thailand slot gacor slot server thailand slot thailand situs slot wwg slot slot daftar judi slot online indonesia slot gacor slot mawin slot gacor slot thailand slot gacor slot gacor demo slot pragmatic sv388 slot88 pgsoft Daftar Judi Slot Online Indonesia Paling Gacor di Indonesia Daftar Situs Judi Slot Online SLOT88 lucky neko slot gacor slot88 slot kakek slot maxwin slot thailand Slot Mahjong Ways 2 Mudah Jackpot Paus di PG Soft Hari ini 2023 Lucky Neko Situs Slot Gacor Pgsoft Hari Ini SITUS SABUNG AYAM SV388 ONLINE DAFTAR LINK LOGIN APK AGEN SV388 Bot Verification

Verifying that you are not a robot...