Datt Absolute Return Fund Performance – May 2026

In May 2026, the Fund returned -3.45%, as elevated cash and energy exposure weighed on performance amid Federal Budget volatility.

Cash and Energy Positioning Weigh on May Performance

The Datt Absolute Return Fund delivered a net return of -3.45% in May, underperforming a Benchmark return of 0.79%. The Fund has returned 13.51% per annum net to investors since inception. Market conditions remained volatile following the Federal Budget, and the Fund stayed conservatively positioned, holding elevated levels of cash and energy exposure through the month.

At month end, the Fund held 15 positions with 69% of capital deployed. The top five holdings represented 45% of portfolio exposure, consistent with the Fund's high-conviction approach.

Performance Snapshot

• 1 month: -3.45%
• 3 months: -17.48%
• 1 year: -13.24%
• 3 years p.a.: 10.24%
• 5 years p.a.: 9.50%
• Since inception p.a.: 13.51%
• Since inception total: 169.28%

Performance is reported net of all fees and expenses. Past performance is not an indicator of future performance.

Download the full report - "May 2026 - Absolute Return Fund Newsletter"

Market Overview

The ASX 200 rose 0.8% in May, a modest headline that masked wide sector dispersion and narrow participation. Materials led on a sharp lithium rally and continued strength in gold producers, supported by elevated bullion prices and a softer Australian dollar. Healthcare and Technology were the principal detractors as the market repriced high-multiple growth names against rising rates and execution risk. Financials, Consumer Staples and Industrials traded defensively against soft corporate updates citing jet-fuel pass-through, weaker discretionary demand, and Middle East risk.

The April monthly CPI print of 4.2% came in firmer than the RBA's February forecasts. The RBA raised the cash rate by a further 25 basis points to 4.35% in May, fully unwinding last year's easing cycle. Dispersion across the large-cap landscape continued to create selective opportunities for active managers, particularly through tax loss season.

Portfolio Insights

New Hope Corporation was the largest contributor for the month, benefiting from higher thermal coal prices and anticipated demand strength tied to ongoing LNG supply disruption out of Qatar.

Wisetech was the largest detractor, sold off 15% despite confirming previous earnings guidance, as negative media coverage continued around previously announced downsizing initiatives. Viva Energy also detracted after an explosion at its Geelong Refinery, described as an act of god. No injuries were reported, and the company guided to a two-month timeline for full production to resume.

Key portfolio characteristics at month end:

• 15 positions held
• 69% of capital deployed
• Top five positions representing 45% of exposure
• Elevated cash and energy exposure maintained through the volatility

Why It Matters for Investors

May demonstrated the value of holding cash through periods of policy-driven uncertainty. The Federal Budget introduced volatility that widened sector dispersion without materially advancing the index, an environment where capital preservation and selective positioning matter more than broad market exposure.

Outlook

The Fund remains conservatively positioned given prevailing market conditions. Elevated cash and energy exposure reflects that stance, with active stock selection continuing to surface opportunities as sector dispersion persists into tax loss season.

About the Datt Absolute Return Fund

The Datt Absolute Return Fund is an independent, research-led strategy focused on capital preservation and delivering consistent, risk-adjusted returns across market cycles.

Key details:

• Minimum investment: $100,000
• Management fee: 1.03%
• Performance fee: 20.5% above benchmark
• Benchmark: RBA Cash Rate + 5%
• Custodian: HSBC
• Auditor: Ernst & Young
• Trustee: Fundhost

To learn more or request a discussion, contact Daniel Liptak at daniel@datt.com.au or 0419 004 524.