Posted by Aston Hill Sales & Marketing TeamPortfolio Manager Vivian Lo (of Aston Hill Growth & Income Fund and Aston Hill Global Growth & Income Fund) explains 'liquid alternatives' and dicusses why it is important for investors to look beyond the traditional 60-40 stocks/bonds portfolio... click here to read the feature.
Expect to see and hear a lot more about alternative investing in the coming year, says Vivian Lo of Aston Hill Asset Management, as some of the strategies become increasingly accessible for Canadian investors.
Q: What is alternative investing and why is there a shift to alternative mutual funds (seemingly) all of a sudden?
I think it’s important to first define what ‘alternatives’ mean. In the world of investing, it can encompass any investment other than equities, bonds or cash. So really, ‘alternatives’ is a pretty large category. The traditional vehicle for investors in alternatives is the hedge fund. Typically though, alternatives broadly refer to hedge funds, private equity, and ‘real’ assets such as real estate, agriculture, timber and infrastructure.
Posted by Steve Vannatta & Joanne Hruska
OPEC confirmed yesterday that it will not be cutting oil production output, with the Iranian delegate saying their intention is to remove inefficient non-OPEC supply from the market. It’s our view that this news will open the door to mid-$60 level crude prices for the first half of 2015. For the remainder of 2014, the market should remain balanced. However, as refiners ramp up runs to meet winter distillate demand, there remains a seasonal expectation of a global stock draw. The core over-supply of distillate, which we expect to be 1-2 MMbbl/d, will likely come in Q1 2015 and continue through to the spring refinery maintenance period.
The decision not to cut suggests OPEC has maintained its collective ceiling of 30 MMbbl/d. Recent OPEC production was approximately 30.7 MMbbl/d so adherence to the target would suggest a production cut of approximately 700 Mbbl/d. Given the cartel has been over-producing from its target since April 2014, we think this will initially lead the market to be more skeptical.
To hear more from the Aston Hill energy and resources portfolio managers, click here to watch Joanne Hruska on BNN yesterday when she discussed OPEC, crude oil prices and her perspective on various break-even points for oil producers around the world.
Posted by John Kim
The markets received a big boost on Friday, with news out of the Peoples Bank of China that it had lowered the 1 year lending rate by 40bps to 5.6% (the first rate cut since July 2012). This news certainly helped risk assets, especially the beleaguered resource sector. But the question remains: is this sustainable? The answer will likely come this Thursday at the OPEC meeting where members will discuss possibly cutting production in order to support oil prices. There has been increased speculation recently surrounding whether the Saudis will support a cut in oil prices or allow prices to stay low.
On the North American front, last week saw the resurgence of the resource sector with Materials, primarily Gold, and Energy, pushing the TSX up by 1.8%. Gold remains the safety trade driving the TSX The story was similar in the U.S., where Materials and Energy helped the S&P 500 gain 1.2% for the week.
Posted by Andrew Hamlin & Vivian LoWe thought it would be constructive to share our high-level thoughts on the markets as we head into year-end. Below is our current outlook:
The macro data coming out of the U.S. signals that the economy remains strong; job openings and labour turn over (JOLTS Report) is at a 13 year high and “voluntary separations” (quitting your job to find another job) is at 60% indicating confidence in the U.S. employment market. In addition, as oil prices drop, consumers directly benefit. Considering that 70% of GDP in the U.S. is consumer-based, this can be very positive for the economy. To put it into perspective, a savings of 1 cent at the pump equals a billion dollars added back into consumers’ pockets and gas prices have moved on average 50 cents – that is $50bn savings! We view this as a significant embedded stimulus and we continue looking at retailer and restaurant stocks as two industries that will directly benefit from lower gasoline prices. In terms of a possible stock market derailment, while valuation might be stretched as we reach all-time highs in the U.S. market, some investors are looking to raise cash and lock in their gains as we approach year-end, so we could see minor pullbacks. While we don’t see this being too much of an issue longer term, we’ve positioned the Aston Hill Growth & Income Fund relatively defensively in case this scenario plays out.
Posted by Aston Hill Sales & Marketing Team
The Aston Hill Growth & Income Fund is the proud recipient of the 2014 Lipper Award for Best Fund over 3 Years: Alternative Strategies. The award recognizes Portfolio Managers Andrew Hamlin and Vivian Lo’s continued commitment to active management. The Aston Hill Growth & Income Fund is a balanced fund that utilizes alternative strategies to generate low volatility returns. Such alternative strategies allow the managers to go beyond traditional long-only portfolio management using additional tools such as short-selling and derivatives including options strategies (puts/calls). Their management style offers clients the potential for enhanced downside protection during times of market volatility while still participating in market gains.
Also referred to as ‘Liquid Alternatives’ these alternative investment strategies are a principle theme across Aston Hill’s suite of mutual fund products. Click here to learn more about the Aston Hill Growth & Income Fund and visit our Liquid Alternative Education Centre to learn more about this rapidly growing asset class.
The AHF Credit Opportunities Fund is generally available to investors that can meet a certain minimum amount of money to invest. The minimum initial investment for residents in any province or territory in accordance with applicable securities laws is set out below:
All provinces and territories $125,000 or $25,000(1)
BC, NB, NS and NL Only: $5,000(2)
(1) A minimum purchase of $25,000 is available to residents who meet certain requirements.
(2) A minimum purchase of $5,000 is available to residents who meet certain requirements and reside in BC, NB, NS and NL by way of the prescribed OM.
Investors should contact their investment dealer or Financial Advisor for more information.
If you can comfortably invest the minimum dollar amount required in your province or territory, please accept the disclaimer below to learn more about the AHF Credit Opportunities Fund.
Disclaimer: Information pertaining to AHF Credit Opportunities Fund is not to be construed as a public offering of securities in any jurisdiction of Canada. The offering of units in the AHF Credit Opportunities Fund is made pursuant to its offering memorandum only to those investors in jurisdictions of Canada who meet certain eligibility requirements. Please read the offering memorandum carefully before investing.
The Aston Hill Opportunities Fund is generally available to investors that can meet a certain minimum amount of money to invest. The minimum initial investment for residents in any province or territory in accordance with applicable securities laws is set out below:
All provinces and territories $150,000 or $5,000(1)
(1) A minimum purchase of $5,000 is available to residents who meet certain requirements. Investors should contact their investment dealer or Financial Advisor for more information.
If you can comfortably invest the minimum dollar amount required in your province or territory, please accept the disclaimer below to learn more about the Aston Hill Opportunities Fund.
Disclaimer: Information pertaining to Aston Hill Opportunities Fund is not to be construed as a public offering of securities in any jurisdiction of Canada. The offering of units in the Aston Hill Opportunities Fund is made pursuant to its offering memorandum only to those investors in jurisdictions of Canada who meet certain eligibility requirements. Please read the offering memorandum carefully before investing.
Dec 22, 2014 16:09 EST