On 31 July this year, 10% of the Intelligent Investor Value Fund’s net assets were invested in Photon shares, based on the last traded price of $1.02. As of 31 August, those shares were trading at $0.098. All else being equal, you would expect the unit price to be down 9% for the month. We expected volatility such as this when we launched the fund – the small number of stocks and relatively large positions tends to mean a volatile unit price. We’re not, however, delivering it.
When we publish the unit price in the next couple of days it will, once again, show almost no change. The abysmal Photon performance has been offset by a stellar reporting season from the rest of the portfolio. The best performers have been Australian Vintage Group (up 36%), Prime Infrastructure (up 29%), Centrebet (up 27%) and ARB Corp (up 21%). MAp, 1300 Smiles, RHG and Spark Infrastructure all delivered results in line with or better than our expectations.
I’m not sure whether to be upset with the one mistake we’ve made or content that the rest of the portfolio is performing exceptionally well. Both, I guess.