Navigating Dislocation with Conviction

In June 2025, the Datt Absolute Return Fund recorded a net return of -1.78%. The month was marked by broader market optimism, yet valuation concerns began to surface within large-cap equities. While the Fund experienced softness in its gold exposures, we used the opportunity to reposition toward long-term value in selected small-cap names.

Performance Snapshot

To summarise:

• Monthly return: -1.78%
• 3-month return: +2.08%
• 12-month rolling return: +9.04%
• Annualised return since inception: +17.53%
• Net return since inception: +204.83%
• Unit mid-price: $1.4830
• Fund status: Open to wholesale investors

Selective Deployment into Mispriced Small-Caps

We allocated capital into businesses that experienced sharp price dislocations driven by temporary factors rather than structural deterioration. These companies hold meaningful market positions and were acquired at discounts to both intrinsic value and their 52-week highs. This reflects our consistent focus on capitalising on short-term inefficiencies, while maintaining a disciplined approach to capital preservation.

Market Conditions Favour Active, Research-Led Investing

Despite headline gains in the ASX200, risk concentration remains elevated among large-cap constituents. In contrast, segments of the small-cap market continue to present attractively priced opportunities. Australia’s macroeconomic fundamentals remain sound, supported by a resilient labour market and an expected easing in monetary policy.

These conditions reinforce our belief that bottom-up, fundamentally grounded investment strategies remain well-positioned to navigate a shifting environment.

Portfolio Positioning – June Snapshot

As at 30 June 2025, the Fund’s high-conviction positions include:

• Meeka Metals (MEK): Exposure to critical minerals with strategic importance.
• Monash IVF (MVF): A resilient healthcare business supported by long-term demographic trends.
• WA1 Resources (WA1): A key resource holding aligned with structural supply constraints.

A Resilient Strategy for Shifting Markets

The Datt Absolute Return Fund is a long-only, benchmark-unconstrained strategy designed to generate absolute, double-digit returns through disciplined, research-led investing. In a market where passive strategies may struggle with valuation risks, the Fund continues to demonstrate a differentiated approach:

• Active allocation into mispriced opportunities
• Strong long-term outperformance relative to benchmark
• Capital preservation in dislocated conditions
• Full manager alignment with investors

We remain highly constructive on our portfolio and see ongoing dislocation as fertile ground for disciplined, high-conviction investing. Our investment team remains meaningfully invested in the Fund, ensuring interests are closely aligned with our clients. Want to learn more about the Absolute Return Fund? Visit the Fund Page or contact our Head of Distribution, Daniel Liptak, on 0419 004 524 or via email at daniel@datt.com.au.