Magellan High Conviction

A concentrated portfolio invested in 8 to 12 of the world’s best global stocks

Investment objectives

To achieve attractive risk-adjusted returns over the medium to long-term through investment in a concentrated portfolio (8-12 securities) of high-quality companies.

Invest in the world's best

  • Alphabet
  • Amazon
  • Microsoft
  • Netflix
  • VISA

Choose from two unique access points

Investors can access the Magellan High Conviction Strategy either as an unlisted managed fund or as a managed fund whose units are quoted on the ASX. These funds offer investors the same global equities investment strategy, but with individual choice about how to access the strategy:

 Unlisted units are only available for purchase and redemption with the fund itself via an application form. Just complete an application form and deliver to the fund’s registry.

Listed units are quoted on the ASX (ASX: MHHT) as an Active ETF and also directly available for purchase and redemption with the fund itself.

 

To find out more about your preferred method of access, and for information on how to invest, please select either the unlisted or listed toggle below.

 

Fund facts

Portfolio manager
Structure
Global Equity Fund, $AUD
Fund size
$377.10 million 31 May 2022
Management fee Distribution Frequency ARSN
1.50% p.a.
0.78% p.a. Class B
Semi-annually 164 285 947
Buy / Sell Spread APIR Code Initial Minimum Investment
0.07%/0.07% MGE0005AU
MGE9885AU Class B
$10,000
Performance Fee

10% (20% for Class B units) of the excess return above the Absolute Return performance hurdle of 10% per annum. Additionally, Performance Fees are subject to a high water mark. For further details on Performance Fees, please read the relevant PDS and the Additional Information Booklet.

All management costs described above are inclusive of the estimated net effect of GST.

Research ratings 1

Zenith

Recommended

Morningstar

Neutral

Lonsec

Recommended

Investment philosophy

The Magellan High Conviction Fund seeks to invest in outstanding companies at attractive prices, while exercising a deep understanding of the macroeconomic environment to manage investment risk.

Magellan perceives outstanding companies to be those that are able to sustainably exploit competitive advantages in order to continually earn returns on capital that are materially in excess of their cost of capital.

While Magellan is extremely focused on fundamental business value, it is not a typical ’value’ investor. The Magellan High Conviction Fund will invest in companies that have relatively high price-to-earnings and price-to-book multiples, provided that their businesses are outstanding and their shares are trading at an appropriate discount to their assessed intrinsic value. Equities that appear undervalued on the basis of a low price-to-earnings or price-to-book multiples will often prove to be poor investments if the underlying business is fundamentally weak and exhibits poor returns on capital.

Magellan focuses on risk-adjusted returns, rather than benchmark-relative returns. As a result, the Magellan High Conviction Fund’s investment process is designed to generate an unconstrained, highly-concentrated portfolio of high-quality companies.

The Magellan High Conviction Fund’s will comprise of 8 to 12 investments, with the portfolio weighted towards Magellan’s highest-conviction ideas.

Portfolio construction

The Magellan High Conviction Fund leverages off the Magellan Global Fund’s investment process, which integrates three key disciplines:

Intensive bottom-up stock analysis and industry research is undertaken in order to identify outstanding companies. This involves the assessment of potential investments against key quality criteria, as well as assessments of their intrinsic value. Magellan uses a proprietary ranking tool, the Magellan Conviction Scoring Matrix, to rank these companies based on these factors. This process enables the portfolio to be weighted towards higher conviction ideas (on a risk-adjusted basis).

Magellan’s detailed macroeconomic analysis is overlayed during portfolio construction, alongside the application of both fixed and dynamic risk limits. This process ensures that the portfolio is not overly exposed to aggregation risk (risk which arises from correlated portfolio positions) or macroeconomic event risk. Macroeconomic event risk can be a significant source of negative returns for investors. Magellan will make significant changes to the portfolio if it believes that macroeconomic events could lead to significant and sustained loss in value for investors. Such events would include a financial crisis, a sustained oil price shock, a global pandemic or a major global conflict.

Performance

Growth of AUD $10,000
31 May 2022

Important Information: Calculations are based on exit price with distributions reinvested, after ongoing fees and expenses but excluding individual tax, member fees and entry fees (if applicable). Fund Inception 1 July 2013.

31 May 2022
Performance 3 Months 6 Months 1 Year 3 Years
(% PA)
5 Years
(% PA)
7 Years
(% PA)
Since Inception**
(% PA)
Magellan High Conviction Fund -13.53% -24.90% -15.88% 1.42% 5.17% 6.37% 10.46%

** Inception date 01 July 2013

Important Information: Calculations are based on exit price with distributions reinvested, after ongoing fees and expenses but excluding individual tax, member fees and entry fees (if applicable). For the ASX Quoted Funds calculations are based on NAVs, published in the ASX announcements for the relevant ASX Quoted Funds, with distributions reinvested, after ongoing fees and expenses but excluding individual tax, member fees and entry fees (if applicable).

Unit Prices

  
Date Net Asset Value Entry Exit
27/06/2022 1.7110 1.7122 1.7098
24/06/2022 1.7209 1.7221 1.7197
23/06/2022 1.6779 1.6791 1.6767
22/06/2022 1.6548 1.6560 1.6536
21/06/2022 1.6429 1.6441 1.6417
20/06/2022 1.6250 1.6261 1.6239
17/06/2022 1.6330 1.6341 1.6319
16/06/2022 1.6130 1.6141 1.6119
15/06/2022 1.6585 1.6597 1.6573
14/06/2022 1.6291 1.6302 1.6280
10/06/2022 1.6543 1.6555 1.6531
09/06/2022 1.6961 1.6973 1.6949
08/06/2022 1.7216 1.7228 1.7204
07/06/2022 1.7241 1.7253 1.7229
06/06/2022 1.7192 1.7204 1.7180
03/06/2022 1.7047 1.7059 1.7035
02/06/2022 1.7325 1.7337 1.7313
01/06/2022 1.7102 1.7114 1.7090
31/05/2022 1.7188 1.7200 1.7176
30/05/2022 1.7122 1.7134 1.7110
27/05/2022 1.7193 1.7205 1.7181
26/05/2022 1.6964 1.6976 1.6952
25/05/2022 1.6616 1.6628 1.6604
24/05/2022 1.6509 1.6521 1.6497
23/05/2022 1.6783 1.6795 1.6771
20/05/2022 1.6654 1.6666 1.6642
19/05/2022 1.6528 1.6540 1.6516
18/05/2022 1.6650 1.6662 1.6638
17/05/2022 1.7265 1.7277 1.7253
16/05/2022 1.7095 1.7107 1.7083
13/05/2022 1.7283 1.7295 1.7271
12/05/2022 1.6911 1.6923 1.6899
11/05/2022 1.6678 1.6690 1.6666
10/05/2022 1.6969 1.6981 1.6957
09/05/2022 1.6743 1.6755 1.6731
06/05/2022 1.6973 1.6985 1.6961
05/05/2022 1.7102 1.7114 1.7090
04/05/2022 1.7759 1.7771 1.7747
03/05/2022 1.7612 1.7624 1.7600
02/05/2022 1.7773 1.7785 1.7761
29/04/2022 1.7566 1.7578 1.7554
28/04/2022 1.8309 1.8322 1.8296
27/04/2022 1.7713 1.7725 1.7701
26/04/2022 1.7519 1.7531 1.7507
22/04/2022 1.7681 1.7693 1.7669
21/04/2022 1.7783 1.7795 1.7771
20/04/2022 1.7941 1.7954 1.7928
19/04/2022 1.8769 1.8782 1.8756
14/04/2022 1.8409 1.8422 1.8396
13/04/2022 1.8687 1.8700 1.8674

Distribution history

IMPORTANT


Please ensure that your Tax File Number (TFN) or Australian Business Number (ABN) is provided to the Unit Registry by Record Date, otherwise tax will be withheld on income attributed to you at the top marginal tax rate plus Medicare Levy.

If you have elected to receive distributions in cash, please ensure that your bank account details are provided to the Unit Registry by Record Date, otherwise your distribution payment will be withheld until a valid bank account is provided.

To review or update your TFN/ABN and bank account details, log on to the Unit Registry’s online portal.


 

Date Distribution per unit Reinvestment price  
December 2021 3.0200 cents $2.2895 Magellan Interim Fund Distributions 2021
June 2021 2.9200 cents $2.1980 Magellan Annual Fund Distributions 2021
December 2020 2.8200 cents $1.9458 Magellan Interim Fund Distributions 2020
June 2020 6.0000 cents $1.9250 Magellan Annual Fund Distributions 2020
June 2019 4.0000 cents $1.8711 Magellan Annual Fund Distributions 2019
June 2018 14.3420 cents $1.6903 Magellan Annual Fund Distributions 2018
June 2017 3.5000 cents $1.5412 Magellan Annual Fund Distributions 2017
June 2016 10.4415 cents $1.3047 Magellan Annual Fund Distributions 2016
June 2015 6.7959 cents $1.4274 Magellan Annual Fund Distributions 2015
June 2014 2.8258 cents $1.1333 Magellan Annual Fund Distributions 2014

24 September 2020 – Distribution Policy Update - click here.

Performance

Growth of AUD $10,000
31 May 2022

Click here for further information on the benchmark.

Calculations are based on exit price with distributions reinvested, after ongoing fees and expenses but excluding individual tax, member fees and entry fees (if applicable). Class B Fund Inception 15 November 2017.

31 May 2022
Performance 3 Months 6 Months 1 Year 3 Years
(% PA)
Since Inception**
(% PA)
Magellan High Conviction Fund - Class B -13.37% -24.81% -15.31% 1.79% 4.22%

** Inception date 15 November 2017. Returns greater than one year are annualised.

Click here for further information on the benchmark.

Important Information: Calculations are based on exit price with distributions reinvested, after ongoing fees and expenses but excluding individual tax, member fees and entry fees (if applicable). For the ASX Quoted Funds calculations are based on NAVs, published in the ASX announcements for the relevant ASX Quoted Funds, with distributions reinvested, after ongoing fees and expenses but excluding individual tax, member fees and entry fees (if applicable).

Unit Prices

  
Date Net Asset Value Entry Exit
27/06/2022 1.0545 1.0552 1.0538
24/06/2022 1.0606 1.0613 1.0599
23/06/2022 1.0340 1.0347 1.0333
22/06/2022 1.0198 1.0205 1.0191
21/06/2022 1.0125 1.0132 1.0118
20/06/2022 1.0013 1.0020 1.0006
17/06/2022 1.0062 1.0069 1.0055
16/06/2022 0.9939 0.9946 0.9932
15/06/2022 1.0219 1.0226 1.0212
14/06/2022 1.0038 1.0045 1.0031
10/06/2022 1.0192 1.0199 1.0185
09/06/2022 1.0449 1.0456 1.0442
08/06/2022 1.0606 1.0613 1.0599
07/06/2022 1.0621 1.0628 1.0614
06/06/2022 1.0591 1.0598 1.0584
03/06/2022 1.0501 1.0508 1.0494
02/06/2022 1.0672 1.0679 1.0665
01/06/2022 1.0534 1.0541 1.0527
31/05/2022 1.0587 1.0594 1.0580
30/05/2022 1.0547 1.0554 1.0540
27/05/2022 1.0590 1.0597 1.0583
26/05/2022 1.0449 1.0456 1.0442
25/05/2022 1.0234 1.0241 1.0227
24/05/2022 1.0168 1.0175 1.0161
23/05/2022 1.0337 1.0344 1.0330
20/05/2022 1.0257 1.0264 1.0250
19/05/2022 1.0179 1.0186 1.0172
18/05/2022 1.0254 1.0261 1.0247
17/05/2022 1.0632 1.0639 1.0625
16/05/2022 1.0527 1.0534 1.0520
13/05/2022 1.0642 1.0649 1.0635
12/05/2022 1.0413 1.0420 1.0406
11/05/2022 1.0270 1.0277 1.0263
10/05/2022 1.0449 1.0456 1.0442
09/05/2022 1.0309 1.0316 1.0302
06/05/2022 1.0450 1.0457 1.0443
05/05/2022 1.0529 1.0536 1.0522
04/05/2022 1.0933 1.0941 1.0925
03/05/2022 1.0843 1.0851 1.0835
02/05/2022 1.0941 1.0949 1.0933
29/04/2022 1.0813 1.0821 1.0805
28/04/2022 1.1272 1.1280 1.1264
27/04/2022 1.0905 1.0913 1.0897
26/04/2022 1.0785 1.0793 1.0777
22/04/2022 1.0884 1.0892 1.0876
21/04/2022 1.0947 1.0955 1.0939
20/04/2022 1.1044 1.1052 1.1036
19/04/2022 1.1553 1.1561 1.1545
14/04/2022 1.1330 1.1338 1.1322
13/04/2022 1.1501 1.1509 1.1493

Distribution history

Date Distribution per unit Reinvestment price  
December 2021 1.8400 cents TBC Magellan Estimated Interim Fund Distributions 2021
June 2021 1.7800 cents $1.3474 Magellan Annual Fund Distributions 2021
December 2020 1.7200 cents $1.1918 Magellan Interim Fund Distributions 2020
June 2020 3.5000 cents $1.1759 Magellan Annual Fund Distributions 2020
June 2019 2.5000 cents $1.1417 Magellan Annual Fund Distributions 2019
June 2018 4.0835 cents $1.0303 Magellan Annual Fund Distributions 2018

24 September 2020 – Distribution Policy Update - click here.

Invest now in the Magellan High Conviction Fund

  1. Complete the Application Form & CRS Form(s) (if applicable)
    You will be guided by the Application Form as to which CRS form(s) to complete.

  2. Send application form to Mainstream Fund Services
    Mainstream Fund Services - Unit Registry
    GPO Box 143
    Sydney NSW 2001

    Or Email the application form to magellanfunds@mainstreamgroup.com

    Temporary processes available during COVID-19

Speak with your adviser/broker. To find an adviser, visit Financial Planning Association of Australia (FPA) or Association of Financial Advisers (AFA).

Application Form

Please ensure that you have read and understood the original FSG and PDS prior to completing and submitting your Application Form.

The automated forms can be either completed on screen and then printed, or downloaded and filled in by hand.

New to Investing? Learn more about our global equities

  • Being a successful investor

    11 attributes we think lie behind Magellan’s long-term success in delivering competitive returns while protecting capital.

    Read article
  • Delivering outstanding results

    At Magellan, the key question we ask ourselves is: “What does the future look like?”. Our answer determines how we invest your money.

    Our global fund returns
  • Why global?

    The case for global investing rests largely on the belief that companies based outside Australia are expected to benefit the most from the key long-term shifts taking place all over the world.

    More on global investing

Investing with Magellan gives you easy access to outstanding global companies: Invest in the world's best.

Continuous Disclosure

7 February 2022 – Portfolio Manager update

Magellan Financial Group Limited (ASX: MFG), the holding company of Magellan Asset Management Limited, today made the following ASX announcement.

Magellan Asset Management Limited, as Responsible Entity of the Fund, advises that, effective immediately, Mr. Chris Mackay will oversee the portfolio management of the Fund and will be working closely with the Fund’s portfolio manager, Chris Wheldon and the investment team.

25 November 2020 - Notification of change to currency hedging strategy

The Magellan High Conviction Fund (“Fund”) has historically exercised its ability to actively hedge the Fund’s foreign currency exposure arising from portfolio investments in foreign markets back to Australian dollars. The objective of this currency hedging strategy was to reduce the impact of foreign currency exposure when the Australian dollar traded outside its historical range.    The portfolio managers of the Fund have determined to change this currency hedging strategy. While retaining the flexibility to reduce the impact of foreign currency exposures associated with identified event risks, the Fund will otherwise adopt an unhedged approach to foreign currency exposures arising from portfolio investments in foreign markets.

 

24 September 2020 - Distribution Policy Update

On 24 September Magellan announced a distribution policy update for the funds for which it acts a responsible entity (‘Fund’ or ‘Funds’).

For each Fund, Magellan intends to target a specific cash distribution yield (“Target Cash Distribution”) and pay distributions semi-annually. Each Fund’s Target Cash Distribution per unit for each semi-annual period will be based on the average of the month-end net asset values per unit applicable to a Fund, or a Fund’s unit class, over a two year rolling period and will be announced at the beginning of each semi-annual distribution period.

This update harmonises the distribution policies across Magellan’s Funds and, Magellan believes, provides investors with greater certainty on the amount of upcoming cash distributions.

For further information and for the Target Cash Distribution per annum for each Fund, please click here.

FAQs

If you have chosen to receive communication via email, you will receive confirmation of your investment within 3 business days from when our unit registry (Mainstream Fund Services) has received your correctly completed Application Form (or notice of additional investment) and cleared application monies. Please note that if you choose to invest by cheque or request us to process a direct debit, it may take up to two business days (in the case of a cheque) and three business days (in the case of a direct debit) for your application monies to clear. If you have chosen to receive communication via mail, please allow for postage time on top of the 3 business days from receipt of your correctly completed Application Form (or notice of additional investment) and cleared application monies

During distribution periods (at the start of July and the start of January for some funds) receipt of your confirmation statement may be delayed by 10-15 business days.

Important Information: Units in the fund(s) referred to herein are issued by Magellan Asset Management Limited (ABN 31 120 593 946, AFS Licence No 304 301). Past performance is not necessarily indicative of future results and no person guarantees the future performance of the fund(s), the amount or timing of any return from the fund(s), or that the investment objectives of the fund(s) will be achieved. This material has been provided for general information purposes and must not be construed as investment advice. It does not take into account the investment objectives, financial situation or particular needs of any particular person. Investors should consider obtaining professional investment advice tailored to their specific circumstances and should obtain and read the relevant Target Market Determination (‘TMD’) and Product Disclosure Statement (‘PDS’) applicable to the fund(s) prior to making a decision about whether to acquire or continue to hold an interest in the fund(s). The TMD and PDS for the fund(s) are available on this website or can be obtained by calling 02 9235 4888. Any trademarks, logos, and service marks contained herein may be the registered and unregistered trademarks of their respective owners. Nothing contained herein should be construed as granting by implication, or otherwise, any licence or right to use any trademark displayed without the written permission of the owner. No part of this material may be reproduced or disclosed, in whole or in part, without the prior written consent of Magellan Asset Management Limited.

1Research house ratings disclaimers

The Zenith Investment Partners (“Zenith”) Australian Financial Services License No. 226872 rating (assigned November 2021) referred to in this document is limited to “General Advice” (s766B Corporations Act 2001) for Wholesale clients only. This advice has been prepared without taking into account the objectives, financial situation or needs of any individual and is subject to change at any time without prior notice. It is not a specific recommendation to purchase, sell or hold the relevant product(s). Investors should seek independent financial advice before making an investment decision and should consider the appropriateness of this advice in light of their own objectives, financial situation and needs. Investors should obtain a copy of, and consider the PDS or offer document before making any decision and refer to the full Zenith Product Assessment available on the Zenith website. Past performance is not an indication of future performance. Zenith usually charges the product issuer, fund manager or related party to conduct Product Assessments. Full details regarding Zenith’s methodology, ratings definitions and regulatory compliance are available on our Product Assessments and at http://www.zenithpartners.com.au/RegulatoryGuidelines 

© 2018 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. Any general advice or ‘class service’ have been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. The Morningstar Analyst Rating™ for the Magellan High Conviction Fund) is ‘Neutral’ as of February 2022.

The rating issued March 2022 is published by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421 445 (Lonsec). Ratings are general advice only, and have been prepared without taking account of your objectives, financial situation or needs. Consider your personal circumstances, read the product disclosure statement and seek independent financial advice before investing. The rating is not a recommendation to purchase, sell or hold any product. Past performance information is not indicative of future performance. Ratings are subject to change without notice and Lonsec assumes no obligation to update. Lonsec uses objective criteria and receives a fee from the Fund Manager. Visit lonsec.com.au for ratings information and to access the full report. © 2020 Lonsec. All rights reserved.

Unit Registry Enquiries

Mainstream Fund Services

Mainstream Fund Services provides a range of registry services including the processing of applications, redemptions and distributions as well as the maintenance of unitholder records.

Please contact Mainstream Fund Services directly for assistance with:

  • Applications or redemptions
  • Change of contact details
  • Change of bank account details

Investor Login

Telephone 1300 127 780 (in Australia) +61 2 8259 8566 (International) 0800 787 621 (New Zealand)