Jackson Aldridge, a 31-year-old former US college basketball player, has transitioned from the court to co-manage the $731 million Regal Australian Small Companies Fund alongside Regal Partners co-founder Phil King. Regal Partners is a $21 billion investment powerhouse integral to Australia’s capital markets, operating as an influential hedge fund manager. Aldridge’s journey into this high-profile role began informally over coffee in 2023, culminating in a “dream job” offer after several intense stock pitches. The fund he co-manages boasts an impressive annualised return of 21.7 per cent after fees since its inception, outperforming its ASX/S&P Small Ordinaries Index benchmark by nearly 8 per cent annually. While it has returned 38 per cent over the past 12 months, the fund has seen an 8.5 per cent dip since March, reflecting a broader small-cap sell-off.
Aldridge’s investment strategy, learned directly from King, focuses on unearthing companies flying under the radar of large index funds. Among his high-conviction long picks is Lindian Resources, an Australian rare earths producer that recently acquired a critical processing facility in Eastern Europe. With operations expected to be fully functional by November, Lindian aims to become a key global producer of mixed rare earth carbonate, offering a strategic asset for nations seeking to diversify away from China’s dominant supply chain. Another notable long position is Artrya, an Australian medical software firm using AI to revolutionise cardiac care. Having secured FDA approval and major US hospital networks, Artrya’s shares have surged, with Aldridge holding an internal price target of $50, eyeing it as a potential “10-bagger.” He also holds Maas Group, a construction business pivoting into data centres and AI through a stake in Firmus Technologies, anticipating significant earnings growth despite an initial market apprehension.
On the short side, the fund actively targets 30 to 50 positions across specific market areas. Aldridge identifies consumer discretionary stocks as a key focus, citing weakened spending due to rising interest rates and cost-of-living pressures, coupled with intense competition. Businesses burdened by massive fixed costs, such as healthcare providers, are also targeted, as inflation and stalling revenue growth can quickly erode earnings. Furthermore, the fund actively shorts over-leveraged companies, awaiting specific catalysts that could trigger financial distress. Aldridge’s disciplined approach, rooted in his basketball background, emphasises “controlling the controllables” amidst market volatility.
