The Fund’s portfolio delivered a grossed-up income return of 0.53% during the month and 8.02% over the past 12 months, outperforming the Benchmark’s grossed-up income returns of 0.14% and 4.52%, respectively.
The Consumer Discretionary, Consumer Staples and Real Estate sectors rallied strongly during the month of June. A sharp drop in global oil prices significantly pulled down short-term inflation expectations and eased bond yields, driving a robust re-rating across these interest rate-sensitive sectors ahead of the financial year-end. These gains were partially offset by weakness in the Energy and Materials sectors, which extended a mid-month commodity sell-off as a stronger US dollar, easing Middle Eastern tensions and the sharp decline in crude prices weighed heavily on broader resource sentiment.
Within the Fund, the strongest contributors were Aristocrat Leisure Ltd (ALL) and Charter Hall Group (CHC). The key detractors of the portfolio relative to the Benchmark for the period were Wesfarmers Ltd (WES) and Pro Medicus Ltd (PME). ALL contributed positively following its mid-year Investor Briefing, where management reiterated its firm earnings guidance for the 2026 financial year and multi-year interactive revenue targets. Market confidence was further buoyed by operational data showing substantial compression in content porting timelines via targeted artificial intelligence (AI) initiatives. CHC also drove performance after declaring a strong 25.84 cent per security distribution for the half-year ended June. This full-year payout increase reinforced investor confidence in the underlying operational cash flows and resilience of its diversified property trusts.
Conversely, WES and PME were the primary detractors to relative performance for the period, solely due to the Fund’s lack of ownership in either stock. WES shares rose over the month, fuelled by surprisingly strong domestic retail spending data and a well-received Strategy Briefing Day. PME also staged a strong rally, driven by a series of high-value US contract renewals and a strategic healthcare AI partnership with Echo IQ.
The Australian economy showed modest growth but faced continued inflation pressures. GDP rose 0.3% in the March quarter and 2.5% over the year, reflecting subdued household spending, higher interest rates and weather-related disruptions to exports. Annual CPI inflation eased slightly to 4.0% in May, down from 4.2% in April, although underlying inflation remained elevated at 3.6%. The RBA left the cash rate unchanged at 4.35% on 16 June, citing persistent inflation risks despite signs of slowing economic activity.
Looking ahead, the broader market remains vulnerable to elevated volatility, with pockets of significant overvaluation persisting across certain sectors and securities. The Fund continues to apply a disciplined investment approach, focusing on high-quality, undervalued businesses with strong fundamentals. By maintaining a diversified portfolio and emphasising income-generating investments, the Fund is positioned to deliver attractive income and sustainable long-term returns, while targeting lower volatility than the Benchmark in an uncertain market environment.
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 is the Responsible Entity and Vertium Asset Management Pty Ltd is the investment manager of Switzer Dividend Growth Fund - Active ETF (ARSN 614 066 849) (the Fund).
Any references to ‘We’, ‘Our’, ‘Us’, or the ‘Team’ used in the context of the portfolio commentary, is in reference to Vertium Asset Management Pty Ltd, as investment manager for the Fund.
This material has been prepared for general information only. 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 must, 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 Fund or that the Fund 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 Fund.
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 Fund’s Product Disclosure Statement (PDS) and consider any relevant offer document in full before making a decision to invest in the Fund. The Fund’s Target Market Determination and other relevant information can be obtained by visiting www.associateglobal.com.
