Magnolia Capital’s Microcap Portfolio Yields Unprecedented Returns for the Month of July

Magnolia Capital, the industry-leading Asia Pacific-focussed financial services firm, is proud to report that July was a strong month for the Magnolia Capital Emerging Companies Microcap Fund 1 (“MCECF”), with returns of ~10% compared to ~0.7% returns by the Benchmark Index (S&P/ASX Small Ordinaries Accumulation Index). MCECF’s outperformance of the Benchmark Index by ~9% was largely due to a significant milestone achieved by one of the portfolio companies (cumulative returns of ~197%1 since inception).
In July, gains in the oil & gas, mining and telecom sectors diminished the effects of the decline we saw in the ITES and healthcare technology However, we expect recovery over the coming months as a number of our investments continue to scale up and improve profit margins globally. We also expect that equity markets will remain exposed to a short-term correction, with possible triggers including the increase in global coronavirus cases, lockdown in the Australian states and the fear of inflation among investors.
The July results demonstrate a strong start for MCECF’s first month of FY22, building on MCECFs FY21 results where it finished the financial year up 117% and outperformed the Benchmark index by ~84%. Overall, FY21 was a strong year for the MCECF even when the equity markets and economy had to face health and economic challenges brought about by COVID-19.
MCECF’s Chief Investment Officer Mitchell Atkins commented, “We are extremely proud of our results during this extremely volatile and uncertain market and are thankful that our investors continued to trust Magnolia throughout the period. We are looking forward to the next 12 months and continuing to outperform our benchmark.”
The Magnolia Capital Emerging Companies Microcap Fund 1 is focused on investing in companies with a market capitalisation of less than A$500 million.
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About Magnolia Capital
Founded in 2015, Magnolia Capital Pty Ltd and its related entities (MC) provides a premium range of fixed income, equities and advisory products and services to High Net Worth and Family Office Wholesale Clients by virtue of its extensive referral network, access to a strong deal flow and the broad industry experience of its staff. MC is an Asia Pacific-focussed financial services business, operating through its five offices located in Sydney, Central Coast (NSW), Melbourne, Hong Kong and Singapore. To date, MC has facilitated over $1.5b worth of transactions.
Mitchell Atkins is the founder and sole shareholder of MC with a wide range of financial services experiences obtained whilst working for large and boutique financials firms around the world. He and the MC team act as trusted investment advisors for clients located around Asia and beyond.
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Source: Magnolia Capital