Risk-Managed Performance in a Volatile Market

What is an Absolute Return Fund?

The Datt Capital Absolute Return Fund is a long-only fund targeting double-digit returns over the medium term, managed by a performance-oriented and differentiated boutique fund manager.

Our objectives are to minimise the risk of permanent capital loss, achieve an absolute return throughout the economic cycle and temper the market risks typical of equity funds. We believe utilising a multi-asset approach reduces downside risk and volatility in returns.

The Performance

The Fund’s results continue to demonstrate our ability top reserve capital while generating returns with less volatility than broader markets.

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Performance snapshot

• Monthly return: +2.10%
• 12-month rolling return: +9.10%
• Net return since inception: +210.36%
• Annualised return since inception: +18.07%
• Unit mid-price: $1.5099
• Fund status: Open to wholesale investors

A Strong MayDriven by Gold Exposure

In May, the Absolute Return Fund delivered a net return of +2.10%,benefiting from favourable market dynamics and strong performance across its gold exposures. Global equities rebounded on the back of a temporary easing in U.S. tariffs and better-than-expected corporate earnings. This supported broad sentiment, though conditions in Australia were notably more subdued.

Our portfolio was positioned to take advantage of asymmetric opportunities, and gold-related exposures were the primary driver of monthly performance. Cash levels remained elevated, providing both downside protection and tactical flexibility.

Market Context and Opportunity Set

While the broader Australian market was relatively flat, volatility persisted beneath the surface. The RBA’s decision to cut the official cash rate to 3.85%, the second cut this year, reflects growing concern over slowing growth and a weaker domestic demand profile. Consumer activity remains cautious, and business conditions have fallen below long-term averages.

Despite these headwinds, we continue to see attractive valuations across select Australian assets, particularly when compared with global peers. From an M&A perspective, the domestic landscape appears compelling, with dislocated pricing and underappreciated fundamentals in several sectors.

Market volatility, far from a deterrent, is providing a fertile environment for active, research-driven stock selection.

Looking Ahead

We expect to deploy capital more broadly in June, across both sectors and opportunity types. The current window, post-tax-loss selling and ahead of FY-end flows, has historically offered mispriced risk and excess return potential.

Our enthusiasm for the portfolio remains high. We are positioned with liquidity, selective risk, and a pipeline of actionable research. In our view, the prevailing environment continues to favour investors with a clear process and the willingness to act when mispricing emerges.

If you’d like to learn more about how the Fund is positioned or explore whether it fits your broader investment strategy, contact our investment team or view the Fund overview.