The Manager will use the research recommendations provided by Euroz Securities as a primary screen to identify suitable investment opportunities. Due to the geographic location of its research team, the majority of stocks covered have a presence in Western Australia.
A range of parameters are used to assess value, but a key input to the analysis is the expected growth potential of the company.
The recommendations of Euroz Securities are then subject to review by the Westoz team. This involves an internal proprietary analysis of the company. Westoz will also select stocks for its own analysis outside of the Euroz Securities portfolio.
After completing the above analysis, a set of stock recommendations will be presented to the Manager’s Investment Committee.
The Investment Committee will review the recommendations and put them in the context of the overall equity environment. It will then review the Company’s current Portfolio in light of the information presented to it and adjust holdings in the Portfolio to ensure the targeted performance is achieved.
The Investment Committee can also use a variety of instruments to achieve its performance objectives. Where they are allowed, short positions may be held where a compelling reason exists. Derivatives may also be used to generate additional income in the Portfolio or to protect the Portfolio from market downturns.
Risk Control
Performance of the Portfolio will be generated from investment in suitable stocks. However, diversification of holdings will be used to limit the risk where the actual performance of individual stocks does not meet expectations. Risk control features of the Portfolio will include:
No one stock will represent more than 20% of the total Portfolio Value at the time of acquisition.
No investment will represent more than a 20% stake in the issued securities of a company.
It is anticipated that the Portfolio will consist of between 10 and 25 stocks, although more or less may be held depending on the number of securities identified that are expected to meet the performance expectations.
Where suitable stocks can not be identified, the portfolio may invest in cash. Whilst unlikely over the medium term, the Portfolio may consist from time to time of significant cash deposits.
Any short positions will not represent more than 20% of the total Portfolio Value.
Leverage may be employed in the Portfolio, but total exposure will not exceed 120% of the Portfolio Value.
Any breach of these risk control measures will be reported to the Company by the Manager and the Company will determine the appropriate action to remedy the breach.
Permitted Investments
Subject to the conditions of the Australian Financial Services licence held by the Manager, the Manager may invest in the following types of investments:
- Listed Securities;
- rights to subscribe for or convert to Listed Securities (whether or not such rights are tradeable on a securities exchange);
- Listed Securities for the purpose of short selling;
- warrants or options to purchase any investment and warrants or options to sell any investment;
- discount or purchase of bills of exchange, promissory notes or other negotiable instruments accepted, drawn or endorsed by any bank or by the Commonwealth of Australia, any State or Territory of Australia, or by any corporation of at least an investment grade credit rating granted by a recognised credit rating agency in Australia;
deposits with any bank or corporation declared to be an authorised dealer in the short-term money market;
- debentures, unsecured notes, loan stock, bonds, promissory notes, certificates of deposit, interest bearing accounts, certificates of indebtedness issued by any bank or by the Commonwealth of Australia, any State or Territory of Australia, or any Australian government authority, or, if authorised by its Directors, a corporation of at least an investment grade credit rating granted by a recognised credit rating agency in Australia;
units or other interest in cash management trusts; and
- any other investment, or investment of a particular kind, approved by the Board in writing.
The Manager intends to seek further authorisations under its Australian Financial Services licence to allow it to invest in other types of investments, including, without limitation, futures or derivative contracts over Australian share market indices.
The Manager will use the research recommendations provided by Euroz Securities as a primary screen to identify suitable investment opportunities. Due to the geographic location of its research team, the majority of stocks covered have a presence in Western Australia.
A range of parameters are used to assess value, but a key input to the analysis is the expected growth potential of the company.
The recommendations of Euroz Securities are then subject to review by the Westoz team. This involves an internal proprietary analysis of the company. Westoz will also select stocks for its own analysis outside of the Euroz Securities portfolio.
After completing the above analysis, a set of stock recommendations will be presented to the Manager’s Investment Committee.
The Investment Committee will review the recommendations and put them in the context of the overall equity environment. It will then review the Company’s current Portfolio in light of the information presented to it and adjust holdings in the Portfolio to ensure the targeted performance is achieved.
The Investment Committee can also use a variety of instruments to achieve its performance objectives. Where they are allowed, short positions may be held where a compelling reason exists. Derivatives may also be used to generate additional income in the Portfolio or to protect the Portfolio from market downturns.
Risk Control
Performance of the Portfolio will be generated from investment in suitable stocks. However, diversification of holdings will be used to limit the risk where the actual performance of individual stocks does not meet expectations. Risk control features of the Portfolio will include:
No one stock will represent more than 20% of the total Portfolio Value at the time of acquisition.
No investment will represent more than a 20% stake in the issued securities of a company.
It is anticipated that the Portfolio will consist of between 10 and 25 stocks, although more or less may be held depending on the number of securities identified that are expected to meet the performance expectations.
Where suitable stocks can not be identified, the portfolio may invest in cash. Whilst unlikely over the medium term, the Portfolio may consist from time to time of significant cash deposits.
Any short positions will not represent more than 20% of the total Portfolio Value.
Leverage may be employed in the Portfolio, but total exposure will not exceed 120% of the Portfolio Value.
Any breach of these risk control measures will be reported to the Company by the Manager and the Company will determine the appropriate action to remedy the breach.
Permitted Investments
Subject to the conditions of the Australian Financial Services licence held by the Manager, the Manager may invest in the following types of investments:
- Listed Securities;
- rights to subscribe for or convert to Listed Securities (whether or not such rights are tradeable on a securities exchange);
- Listed Securities for the purpose of short selling;
- warrants or options to purchase any investment and warrants or options to sell any investment;
- discount or purchase of bills of exchange, promissory notes or other negotiable instruments accepted, drawn or endorsed by any bank or by the Commonwealth of Australia, any State or Territory of Australia, or by any corporation of at least an investment grade credit rating granted by a recognised credit rating agency in Australia;
deposits with any bank or corporation declared to be an authorised dealer in the short-term money market;
- debentures, unsecured notes, loan stock, bonds, promissory notes, certificates of deposit, interest bearing accounts, certificates of indebtedness issued by any bank or by the Commonwealth of Australia, any State or Territory of Australia, or any Australian government authority, or, if authorised by its Directors, a corporation of at least an investment grade credit rating granted by a recognised credit rating agency in Australia;
units or other interest in cash management trusts; and
- any other investment, or investment of a particular kind, approved by the Board in writing.
The Manager intends to seek further authorisations under its Australian Financial Services licence to allow it to invest in other types of investments, including, without limitation, futures or derivative contracts over Australian share market indices.