Sydney-based Airlie Funds Management, which oversees $8.5 billion in assets, has seen its $1 billion Airlie Australian Share Fund deliver a robust quarter of performance. Deputy Portfolio Manager Joe Wright reported the fund finished over six per cent above its benchmark for the last three months, a welcome turnaround after ending the 2026 financial year a couple of points below par. This strong result was attributed to effective positioning against large index weights like banks and materials, alongside avoiding significant downturns.
The fund maintains a substantial underweight to the big four banks, a stance driven by concerns that their return on equity does not justify current valuations, particularly in light of a softer economic outlook and recent tax changes. From a materials perspective, the fund benefited from overweight positions in diversified miners and lithium, though it was underweight gold. Following a pullback in gold names, the sector is now back on the fund’s radar. Wright also noted that recent sell-offs in technology and healthcare are presenting new opportunities, leading to additions like Life360, Xero, and Carsales as valuations have become more attractive.
Over the past six months, the fund has introduced the most new names since its inception, viewing industrials as offering compelling value. Recent additions include Orica, IAG, and Pinnacle, with these purchases funded by exiting positions in CSL and Charter Hall. Among its holdings, the fund favours Aspen Group, a residential property developer and operator focused on addressing Australia’s undersupply of affordable housing. Additionally, the fund has added a small position in Ridley Corporation, a manufacturer of animal feed which expanded its operations by acquiring Incitec Pivot’s fertiliser distribution business, seen as a structural opportunity to enhance earnings and returns.
