Transcription of Finance News Network Interview with Antares Dividend Builder Fund Portfolio Manager, Glenn Hart
Lelde Smits: Hello I’m Lelde Smits for the Finance News Network and joining me from the Antares Dividend Builder Fund is Portfolio Manager, Glenn Hart. Glenn welcome back to FNN.
Glenn Hart: Thank you.
Lelde Smits: The Fund looks for stable revenue streams in your stock selection. What factors must a company exhibit before you enter the position?
Glenn Hart: We look at stocks very holistically, but they must have a high yield to pass our initial screening. From there they need to have stable cash flows, very strong balance sheet, ability to grow their dividends. So there are a range of factors that they must pass before they get included in the portfolio.
Lelde Smits: What are the biggest mistakes that you see investors make when on the hunt for yield?
Glenn Hart: Well that is just looking at yield only and not looking at the sustainability of the yield. So you have to look at the cash flows, the balance sheet, whether the yield is juiced up for artificial factors, and whether it can grow in the future.
Lelde Smits: What risk mitigation does the Fund have in place to avoid getting into a yield trap?
Glenn Hart: Well pretty much by systematically following all the factors that I mentioned in the first point. So if you make sure that there’s a bit of growth, if you make sure the cash flow’s good and the balance sheets strong. You make sure the company has a big market share, it’s solid, that there’s good people running it. That is pretty much your risk mitigation.
Lelde Smits: The Fund’s benchmark is the S&P ASX 200 Industrials Accumulation Index. How have you performed over the September quarter and over the past year?
Glenn Hart: Dividend investing has been very fruitful. Over the past three years, the Fund has grossed 21.7 per cent per annum. So we would just say that we’ve really harvested an exceptional period in history, for dividend investing. And going forward, we think returns will be good, but they won’t be as good as they have been in the past three years.
Lelde Smits: Finally Glenn, the Fund’s strategy is to deliver an attractive long term yield. Which sectors do you believe are best positioned to deliver consistent long term earnings growth?
Glenn Hart: We tend to find that we invest in sectors with low volatility and that kind of helps the compounding effect for earnings. So we find REITS, utilities, infrastructure make up a core part of the portfolio. Financials, although their earnings are obviously way more volatile and other sectors like consumer staples are good, if we can find suitable stocks. So set from there, very much stock specific after that kind of, the core of the portfolio you get from the very low volatility yield type traditional, yield type sectors.
Lelde Smits: Glenn Hart, thank you for the update from Antares Dividend Builder Fund.
Glenn Hart: Thank you.
Ends
