Allan Gray Australia Stable Fund

To meaningfully outperform cash, you need to be invested in growth assets, but some investors don’t want full exposure to the Australian sharemarket. That’s where the Allan Gray Australia Stable Fund can help. The Fund aims to outperform the Reserve Bank of Australia cash rate over the long term by investing predominantly in cash, but can boost returns by investing no more than 50% in the Australian listed securities. Rather than holding complicated investments, it’s simply a cash-heavy fund that invests in listed securities, like shares, when we believe the opportunity is right.

The Fund may suit you if:-

You're looking for a simple alternative to cash with potential for better returns
You want to preserve your purchasing power but wish to generate more returns than cash offers. The Fund’s cash-plus objective and limited exposure to shares may outperform cash over the long term.

You're a conservative investor wanting some stability
Although you want potentially higher returns than cash, you’re averse to losing capital. The Fund gives you exposure to the Australian sharemarket without being fully invested by limiting your exposure to shares to 50% of its assets. The Fund also helps you by investing in shares when the share price has fallen and there is better value in the market. This strategy can reduce risk, while increasing potential returns as share prices rise.

Why choose the Allan Gray Australia Stable Fund? 

To access sharemarkets with lower risk
We strongly believe investors need to be invested in shares to pursue long term returns, but not everyone is comfortable with the volatility this can bring. By investing predominantly in cash with selected exposure to the sharemarket, the Fund enables clients to potentially outperform cash with less risk than investing in the sharemarket alone. Exposure to shares will never exceed 50% of the portfolio and has historically averaged 30% since the Fund’s inception.

To outperform cash without too much complexity
We don't believe that beating cash should be complicated. This is why the Fund does not employ complex strategies such as long/short trading, options or derivatives. It simply invests in cash, term deposits and money market instruments and has limited exposure to selected domestic securities, like shares.

Time-tested contrarian investment philosophy
Our investment philosophy is simple – we take a contrarian approach, apply it consistently and invest for the long term. To give investors the benefit of this approach, our Stable Fund still incorporates our contrarian share ideas that we use in our Equity Fund while prioritising our long-term fundamental analysis.

If you are looking for a low-volatility fund
The Fund traditionally has lower volatility than other funds offering equity exposure because it is predominantly invested in cash. While our selective exposure to shares gives investors the potential to generate higher returns than cash, the Fund has much less volatility than a pure equity fund. Volatility is also reduced as a result of our contrarian approach, as its inherent countercyclical behaviour means we invest more in shares when we believe they are undervalued, then we reduce exposure as the market rises and we see less value. This helps to drive long-term real (above inflation) returns, while seeking to reduce the impact of major market falls.

Please download the latest Fund Fact Sheet to see the Fund's latest holdings and exposure to ASX-Listed Securities over time.

The information provided above has been issued by Allan Gray Australia Pty Limited ABN 48 112 316 168, AFSL No. 298487. Equity Trustees Limited ABN 46 004 031 298, AFSL 240975 is the issuer of units in the Allan Gray Australia Equity Fund, Allan Gray Australia Balanced Fund and Allan Gray Australia Stable Fund.

This information is of a general nature and is not an offer to sell, or a solicitation to buy, interests in any financial products. It has been prepared without taking into account the individual objectives, financial situation or needs of any particular person. Before acting, you should consider its appropriateness having regard to your objectives, financial situation or needs and consider seeking financial advice. You should obtain the relevant disclosure documents to any of the financial products mentioned above before deciding to acquire, dispose of or hold an investment in these products.

Disclosure documents including the Target Market Determinations can be found at allangray.com.au/PDS-TMD-documents.  Past performance of any financial product mentioned is not a reliable indication of future performance. When making an investment, an investor’s capital is at risk. We have tried to ensure that the information here is accurate in all material respects, but cannot guarantee that it is.