Microsoft Word - Media Release Lonsec and Atchison award SMI new ratings MEDIA RELEASE

19 May 2015

Lonsec and Atchison award SMI new ratings

The rapidly-growing, $295 million fixed-income boutique, Smarter Money Investments, has been awarded two new research ratings from Lonsec and Atchison Consultants for their Active Cash ("Investment Grade") and Higher Income ("Recommended") strategies.
In May Lonsec assigned Smarter Money Active Cash an "Investment Grade" rating, which it says "indicates Lonsec has conviction the financial product can generate risk-adjusted returns in line with relevant objectives". Highlighting the product's strengths, Lonsec noted that Smarter Money Active Cash has a "high quality and driven investment team" and had developed a "strong track record since inception in February 2012".
Smarter Money Active Cash was, in fact, the No. 1 ranked product in Lonsec's "enhanced cash" universe in terms of post-fee returns over the last 3 years. According to Lonsec's analysts Sam Morris and Libby Newman, Smarter Money Active Cash also had a high Sharpe Ratio, which measures risk- adjusted returns, of 4.6 times over the 12 months to 31 March 2015 compared to its peer group's Sharpe Ratio of 2.9 times (the fund's 3.9 times Information Ratio, which measures risk-adjusted returns relative to an index, was also better than the peer group average of 1.4 times over the same horizon). A confidential copy of the Lonsec report can be downloaded here (Lonsec.pdf).
SMI's Co-Chief Investment Officer, Darren Harvey, said "Lonsec's rating is welcome and now sits alongside Smarter Money Active Cash's existing evaluations from Mercer (confidential), Atchison Consulting (Highly Recommended), and Australia Ratings (A)".
In a second rating development, Atchison Consultants awarded Smarter Money Higher Income a "Recommended" rating in May with principal Jake Jodlowski finding that the fund had "outperformed the Bloomberg AusBond Floating Rate Note Index by 0.7% per annum" compared to the average Morningstar Australian income multi-strategy manager's outperformance of only 0.2% per annum.
According to Atchison, a "Recommended" rating means the "manager's product has consistently outperformed the median manager across our assessment criteria", and that they "expect the manager to perform ahead of a reasonably appropriate risk and return objective...over a full investment cycle." The author of the report, Mr Jodlowski, was formerly head of funds management at IOOF.
The Atchison report states that Smarter Money Higher Income had "generated an information ratio of 3.6, adding material value against the broader market as measured by the Bloomberg AusBond FRN Index", and noted that the average peer fund produced "an information ratio of 0.3 over the same period", which was "1.2 points lower" than Smarter Money Higher Income.
Confidential copies of the two reports can be downloaded here (Lonsec.pdf) and here (Atchison.pdf).

ENDS

For more information, contact: Rob Morton
Head of Investment Products
Smarter Money Investments
M 0416 238 181
E rob.morton@smitrust.com.au

About Smarter Money Investments

Smarter Money Investments Pty Limited (SMI) is an independent fixed-income manager established in 2011 as

a joint venture between Coolabah Capital Investments Pty Ltd, which is owned by SMI's investment team, and

the ASX listed Yellow Brick Road Holdings Limited (ASX Code: YBR), which assists with product and distribution.

SMI's comparative advantages are in active cash management, active bond selection, and minimising credit and

interest rate duration risks. SMI believes that there is a significant role for liquid active cash and low duration fixed-interest to play in both individual and institutional portfolios. This is a summary only: you can read more at the full SMI by clicking here.

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