Atrium Risk Targeted Growth 9 Portfolio
As at 31 December 2024
Features
Information
^Liquidity dependent on underlying holdings. Varies from daily to weekly.
Ratings & awards
A rating is only one factor to be taken into account when deciding whether to invest.
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Investment objective
To seek to maximise returns while managing portfolio volatility such that it does not exceed the upper risk limit of 9% p.a. over rolling three (3) year time periods.
Investment strategy
Atrium's focus is on the level of risk within the portfolio. We seek to allocate to investments across a broad range of asset classes based on an assessment of their value and contribution to total risk and return.
Atrium can dynamically adjust the allocation to asset classes on an ongoing basis. By doing this, we seek to build a portfolio that can withstand changes in underlying market volatility.
The aim is to deliver a risk level in the Investment Portfolio that is consistent with the investment profile selected.
Building portfolios that smooth out volatility
Atrium’s Risk Targeted investment approach aims to offer investors a smoother investment journey. By challenging conventional thinking and allocating to a wide array of investments, we construct truly diversified portfolios that seek to maximise opportunity and manage risk.
During market downturns we focus on minimizing losses to help investors achieve consistent growth over the long-term with less volatility. This is important to us because we care about the entire investment journey, not just the destination.
Our disciplined process is underpinned by three core principles that have enabled us to effectively pursue our investment objectives over a long time horizon.
Focus on risk first
Seek consistency of returns
Seek to preserve capital
Source: Atrium, for illustrative purposes only. This graph is not a guarantee of future performance and undue reliance should not be placed upon it.
Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
SQM Research is an investment research firm that undertakes research on investment products exclusively for its wholesale clients, utilising a proprietary review and star rating system. Information contained in this document attributable to SQM Research must not be used to make an investment decision. The SQM Research rating is valid at the time the report was issued, however it may change at any time. While the information contained in the rating is believed to be reliable, its completeness and accuracy is not guaranteed. The SQM Research star rating system is of a general nature and does not take into account the particular circumstances or needs of any specific person. Only licensed financial advisers may use the SQM Research star rating system in determining whether an investment is appropriate to a person’s particular circumstances or needs. You should read the product disclosure statement and consult a licensed financial adviser before making an investment decision in relation to this investment product. SQM Research receives a fee from the Fund Manager for the research and rating of the managed investment scheme.
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Source: Atrium Investment Management, Colonial First State. Performance as at the date of this report. Inception date is 9 November 2016. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed. Performance figures relate to the model portfolios managed by Atrium. Individual investor portfolio performance may be different from the results above and will differ among clients depending on the timing of their investment and the level of variation from the models. Performance is after fees and costs, assumes reinvestment of all distributions, is calculated using the highest annual fee tier, and does not take into account some or all of the rebates you may receive. Return objectives are internal return objectives which are measures that Atrium considers internally when managing the portfolio. Internal return objectives are not performance benchmarks and are not features set out in the PDS. Please refer to the managed account’s Product Disclosure Statement (PDS) for more information on returns.
Performance
| Since inception (% p.a.) | 10 Years (% p.a.) | 7 years (% p.a.) | 5 years (% p.a.) | 3 years (% p.a.) | 1 year | 6 months | 3 months | 1 month | |
|---|---|---|---|---|---|---|---|---|---|
| Portfolio | 6.18% | 5.57% | 5.27% | 4.11% | 12.88% | 6.85% | 5.05% | 0.62% | |
| Objective | 6.25% | 6.29% | 6.47% | 7.66% | 8.87% | 4.36% | 2.16% | 0.72% |
Objective refers to the Return objective as stated in the Key Facts table.
Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
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Understanding our Risk Targeted investing approach
Atrium is a multi-asset investor that challenges conventional thinking and practices with a proven Risk Targeted approach that preserves and grows wealth for clients. Risk Targeted investing is a dynamic approach to generating investment returns in a more consistent manner while controlling overall portfolio risk. We give our investors the confidence to stay invested through the ups and downs of financial markets, providing peace of mind on your wealth building journey.
Building portfolios that smooth out volatility
When constructing portfolios, our focus is on managing risk through our allocation to a wide array of investments. In this way, Atrium aims to build portfolios that are less susceptible to market volatility and therefore deliver more consistent return outcomes.
Illustrative Only
Case study: COVID-19
The first quarter of 2020 was a volatile period for markets as the COVID-19 pandemic started to spread around the globe. In line with our Risk Targeted investment philosophy, our portfolios focused on managing risk to limit drawdowns (i.e. the loss of investor capital), and on delivering more consistent returns for investors over the long-term. While returns were lower over the quarter as a result of the sharp market decline, the Atrium portfolios benefited from our genuine diversification, our dynamic asset allocation approach and a more defensive positioning entering this volatile period.
Portfolio performance (Feb 2020 - Apr 2020)
| Feb 2020 | -2.7% |
| Mar 2020 | -8.2% |
| Apr 2020 | 2.3% |
ASX performance (Feb 2020 - Apr 2020)
| Feb 2020 | -7.7% |
| Mar 2020 | -20.7% |
| Apr 2020 | 8.8% |
Volatility & Sharpe Ratio
| 10 Years | 7 Years | 5 Years | 3 Years | |
|---|---|---|---|---|
| Volatility (% p.a.) | - | 6.33 | 6.74 | 5.55 |
| Sharpe Ratio | - | 0.59 | 0.48 | 0.16 |
What is volatility?
Volatility measures the fluctuations, or changes, in the price of an asset or market index. Assets with higher volatility generally have greater price changes, both positive and negative, and so higher volatility is generally an indication of higher risk.
What is the Sharpe Ratio?
The Sharpe Ratio measures returns relative to the volatility, or risk, that was taken to achieve that return. The higher the ratio, the better the risk-adjusted performance has been - in other words, the investment risks taken have delivered better returns to the portfolio.
Maximum drawdown since inception
What is maximum drawdown?
Maximum drawdown measures the largest fall in an asset's or market's price, from a peak to its subsequent lowest point. Maximum drawdown is an indicator of downside risk specifically - that is, it reflects the greatest loss of capital an investor may have experienced over the time period.
Performance in positive & negative markets since inception
Portfolio - Average monthly return
ASX200 - Average monthly return
What is up/down capture?
Up capture measures how an asset has performed in periods where the market return was positive, whereas down capture measures how the asset has performed in periods of negative market returns. Together, these measures provide an indication of how the asset has performed in both positive and negative market environments.
How we manage risk in portfolios
Sequencing risk
Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
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Asset allocation
| Rates & credit | 4.38% | |
| Cash | 7.98% | |
| Australian equities | 23.91% | |
| International equities | 37.77% | |
| Listed infrastructure | 3.04% | |
| Liquid alternatives | 22.92% |
Atrium aims to achieve its investment objectives by investing across a range of asset classes on a global basis that provide exposure to different risk factors.
Each asset is included in the Portfolio for its ability to contribute to returns on a stand alone basis.
The investment universe comprises of 3 broad categories - Preservers, Growth Drivers and Diversifiers.
 | PreserversAssets that protect the portfolio during periods of heightened equity market volatility and preserve capital, such as cash, government bonds and high quality investment grade bonds. |
 | Growth DriversAssets that are expected to deliver higher rates of return over time with higher levels of associated volatility (risk). This predominantly comprises equities but also includes other assets that are highly correlated to equities such as listed property and infrastructure. |
 | DiversifiersAssets that generate additional real returns, with performance that is typically uncorrelated to the growth drivers and preservers within the portfolio.Importantly, they are a source of portfolio diversification away from equity market and interest rate risks, such as liquid alternatives and private markets. |
Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
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Top holdings
| Holding | Weight | Capital Position |
|---|---|---|
| BETA GBL SHARES ETF ETF UNITS | 11.74% | Equities |
| CASH POSITION | 7.98% | Cash |
| ANTIPODES GLOBAL FUND - LONG ONLY CLASS I | 5.76% | Equities |
| FAIRLIGHT GLOBAL SMALL AND MID CAP (SMID) FUND - FOUNDATION CLASS | 5.14% | Equities |
| CROWN DIVERSIFIED MACRO SEGREGATED PORTFOLIO SERIES | 5.00% | Liquid alternatives |
| CROWN ATRIUM SEGREGATED PORTFOLIO SERIES 1 USD | 4.78% | Liquid alternatives |
| HYPERION GLOBAL GROWTH COMPANIES FUND - CLASS C | 4.48% | Equities |
| BETA SP500 EQUAL ETF ETF UNITS | 4.47% | Equities |
| MAN ALTERNATIVE RISK PREMIA - CLASS A SHARES (AUD) | 4.46% | Liquid alternatives |
| VANGUARD INTERNATIONAL SHARES ETF | 4.00% | Equities |
Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
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Market update
Equities rose in the December quarter, the fifth consecutive quarterly gain, to close out a strong year. The US market outperformed, helped by ongoing strong returns in Information Technology. Australian equities actually fell slightly over the quarter. Government bond yields rose sharply in major markets in December. The Australian dollar fell sharply, and the gold price slid slightly from record highs earlier in the quarter.
US equities gained 2.4% in the quarter with notable contributions from:
• Automobile stocks led the market for the quarter, with Tesla gaining 54%, partly reflecting Elon Musk’s involvement in the Trump political campaign.
• Energy and the Banking Sector were also supported by the election result. Although the exact policy stance is unclear, both stand to benefit from a deregulation focus under Republicans.
• Gold and Copper-related stocks were hit hard, partly reflecting the strong US dollar, and falling commodity prices.
The Australian market underperformed the US market in December and over the quarter.
• Significant weakness was seen in Real Estate, which continues to suffer under higher funding rates, and in particular the Materials Sector, where market leader BHP fell by almost 14% over the quarter, driven by commodity prices, and uncertainty as to whether Chinese authorities have done enough to support their economy and property sector.
• Gains were seen in the Financial Sector, although the major Banks were mixed over the quarter.
US 10-year bond yields rose over the quarter. The rise commenced following the Federal Reserve’s rate cut in September, and this continued through October. The US election result saw some further selling pressure in early November, pushing yields higher, before a further push higher in yields through December as the markets started to factor in some possibility that the Fed may need to hike rates, rather than cutting further as previously assumed. Australian bond yields rose, generally moving in line with the much larger US market.
As bond yields rose, one notable victim was the Australian dollar which fell very sharply in December (-5.2%), leaving it almost 11% lower over the quarter.
Performance
The Portfolio ended the year strongly, with global equities, liquid alternatives and rates and credit exposure all contributing positively to returns over the month, while Australian equities was the only major detractor.
The global equities allocation was the key driver of performance, benefitting primarily from a large fall in the Australian dollar against other major currencies, with the Hyperion Global Growth Companies Fund in particular delivering another stellar return. The Vanguard FTSE Emerging Markets ETF was also a strong performer as that segment of the market recovered over the month, while our global listed infrastructure and the Betashares S&P 500 Equal Weight ETF exposure were the only major detractors.
The direct Australian equities sleeve was negative over the month, detractors included Car Group Limited and National Australia Bank.
Our Diversifiers were positive in aggregate over the month, with our currency manager the key standout taking advantage of the stronger US dollar, while our systematic strategies were also very strong performers after a difficult prior few months.
Portfolio changes
Over the month we reduced some our global active equity exposure including Hyperion Global Growth which has been performing exceptionally well recently and re-allocated some proceeds towards our passive equity exposure, primarily via the Betashares S&P 500 Equal Weight ETF, which provides a diversified exposure to the smaller cyclical end of the large cap index and offers a compelling opportunity at this point in the cycle. The weakness over the month provided another attractive entry point.
Over the month we took advantage of cheap option prices to extend our S&P 500 put options into February 2025, providing downside protection should equity markets decline.
Outlook
Global equity markets ended the year on a high, with the US market in particular the standout performer. As we look into the new year, the key risk is whether inflation will return in the US (after heading lower over 2024) and whether domestic inflation will move within the RBA target band allowing the Reserve Bank of Australia to catch up to global counterparts and lower interest rates. Other risk factors include the impacts of a second Trump Presidency on both global growth and inflation and other geopolitical headwinds.
With the improving macroeconomic backdrop and sentiment over 2024, our decision to increase our weighting to global equities through the year has been rewarded with solid calendar year performance. The Portfolio remains well diversified with an array of return levers. While we continue to hold equity exposure above our longer-term averages with a preference for global over domestic equities, we remain cognisant of the risks of elevated investor bullishness – notably around “US exceptionalism” (US Mega Cap Tech stocks).
Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
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Important Information:
The information in this document (Information) has been prepared and issued by Atrium Investment Management Pty Ltd (ABN 17 137 088 745, AFSL 338 634) (Atrium). This information is provided for the use of licensed and accredited financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products. The Information is of a general nature only and does not take into account the objectives, financial situation or needs of any person. No liability is accepted for any loss or damage as a result of any reliance on the Information. Past performance is not a reliable indicator of future performance. Future performance and return of capital is not guaranteed.
The Trust Company (RE Services) Limited (ABN 45 003 278 831, AFSL 235 150) is the Responsible Entity of the Colonial First State Separately Managed Account (ARSN 618 390 051) (CFS SMA). Investments in the Colonial First State Separately Managed Account are only available on FirstWrap Plus. Investors should consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) before making any investment decisions. Applications for a portfolio in the CFS SMA can only be made pursuant to the application form attached to the relevant product disclosure statement or IDPS guide (CFS SMA Offer Documents). Please refer to the CFS SMA Offer Documents for important information concerning an investment in the CFS SMA.
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