Watermark Funds Management

We are active, high conviction investors in Australian and international shares. As an absolute return manager, Watermark offers a proven alternative to traditional institutional funds. Watermark manages three Listed Investment Companies:...


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Opportunities abound for Clydesdale Bank

Watermark Funds Management

Clydesdale Bank (CYBG) is a British retail bank which spun-out of the National Australia Bank in 2016. Pursuant to an announcement on May 7th, the company has proposed to acquire fellow UK challenger bank Virgin Money. At the present moment, investors don’t know whether they are buying CYBG’s “old pitch”... Show More


AMP – Talking investors down off the ledge

Watermark Funds Management

AMP’s recent misadventures provide a business school case study in how to mismanage a number one market position in a fundamentally attractive industry. The shocking mishandling of the public relations associated with the Financial Services Royal Commission is one more in a long line of management missteps, exacerbated by festering... Show More


AMP clear as mud on capital allocation

Watermark Funds Management

Somehow between 25 May and 10 August AMP managed to lose $800m of excess capital down the back of the couch. On Thursday, In an otherwise unremarkable set of full-year results, AMP announced to the market the good news that it had undertaken a reinsurance deal with Munich Re which... Show More

ASX:AMP August 2017 Reporting Season

What are the Bond Markets Telling Us

Watermark Funds Management

With the RBA not giving any clear signal as to the likelihood of further rate cuts, the big story for markets is the end of the bond rally, with prices falling and bond yields on the rise. The implications for equity markets are no less clear. Watermark Funds Management Chief... Show More

Better value in base metals than gold

Watermark Funds Management

Tom Richards, Senior Analyst at Watermark Funds Management, highlights in this video the challenge of finding value in gold equities today. He says this was illustrated in Evolution’s recent transaction, where it was "difficult to find opportunities in the market especially if you have to pay a 30% premium. Hence... Show More

gold mining iron ore copper nickel ASX:IGO ASX:WSA ASX:EVN

Strong fundamentals underpin gold and zinc

Watermark Funds Management

Tom Richardson, Senior Analyst at Watermark Funds, believes there is a handful of commodities that remain well supported at current levels, despite the recent strong performance. Specifically, he says the outlook for Gold and Zinc look attractive with good fundamentals underpinning current prices. It’s a different situation in bulk commodities... Show More

gold glencore zinc ASX:EVN LON:GLEN

Commodity markets face fresh headwinds

Watermark Funds Management

Tom Richardson, Analyst at Watermark Funds, says heavy-handed stimulus coming out of China was the key catalyst for resurgent commodity markets in 2016. “The Chinese economy has two very big levers, and that’s infrastructure investment and property investment. And the government pulled both those levers quite hard late last year.... Show More

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Giants of the Internet: Amazon

Watermark Funds Management

In the space of 20 years, Amazon has become the most valuable retailer in the world, overtaking Walmart by market capitalisation. From humble beginnings in the 1990s as an online bookstore, Amazon has taken the consumer by storm and now offers everything from electronics to fresh food. Amazon is aggressively... Show More

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Giants of the Internet: Google (Alphabet)

Watermark Funds Management

In the coming weeks, we will introduce the giants of the internet. While interesting in their own right, these disruptors will frame many industries beyond their current influence Show More

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A unique asset that’s materially undervalued

Watermark Funds Management

Digital disruption has been, and will continue to be one of the major themes of the 21st century. Across a raft of industries, traditional business models are being superseded by digital platforms such as Facebook and Amazon. Music streaming is a new front in which behemoths such Apple and Google... Show More

The best way of protecting against downside volatility

Watermark Funds Management

As a long/short manager, we hedge sharemarket risk for our investors by short-selling the shares of weak businesses when they are overvalued. By holding long and short portfolios of roughly equal size and composition, our funds have little or no net exposure to the share market. Our directional fund provides... Show More

investor education capital protection the buy side brief shorting

AUD heading back below 70 US cents

Watermark Funds Management

As with Brexit, the fallout from the political gridlock will play out most noticeably in currency markets, particularly if S&P lowers our credit rating. The election result ensures the Australian dollar trades back below 70 cents in the medium-term. Australian companies operating offshore will benefit from this of course, but... Show More

credit rating geopolitical risk the buy side brief

Secular Stagnation - what is it and what does it mean for asset markets?

Watermark Funds Management

Despite continued stimulatory initiatives from central banks around the world, sustainable economic growth remains elusive. The causes of this malaise are varied, but consensus has built around the theory of 'secular stagnation' as a key hindrance to global economic growth. In a recent presentation to investors, Justin Braitling - CIO... Show More

secular stagnation

Why is Apple so cheap?

Watermark Funds Management

Since the launch of the iPhone in 2007, Apple has grown its sales tenfold. Apple shares have also performed strongly during this period, however sentiment around the company has recently mellowed as concerns arose over whether Apple and the iPhone in particular can sustain this growth. Apple’s current share price... Show More

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The case for investing in Apple

Watermark Funds Management

Income growth and investment in mobile infrastructure in emerging markets such as China and India, present Apple with huge new markets for the iPhone. Sales of the iPhone following its Chinese product launch in 2009 were unimpressive, a result of compatibility issues with the proprietary 3G network technology run by... Show More

Apple Inc

What to avoid in global media

Watermark Funds Management

Technology is changing the global media landscape. Consumers now absorb content from numerous sources on multiple devices. This disintermediation of viewership is a challenge to advertisers seeking effective reach and targeted messaging. The massive shift to mobile by consumers over the last few years has forced business models to adapt... Show More

Blue chips won’t see further dividend growth

Watermark Funds Management

As interest rates have fallen forcing investors to look for yield in risk assets, income has been re-rated versus growth. We believe this re-rating of income generating assets has run its course. Low growth, mature share markets like ours are looking expensive relative to others with stronger growth prospects. You... Show More

Focus on those companies delivering value to customers

Watermark Funds Management

We are in a low growth environment with strong deflationary forces, the companies that will prosper in this environment are those that provide value to their customers. Australia is an expensive place to live and conduct business. Many of our leading companies are struggling because they are generating excessive profits,... Show More

the buy side brief

Where to for commodity prices? Beware the three D's!

Watermark Funds Management

Commodity prices have continued to grind lower in 2015, impacted by the three D's: Demand, Deflation and Debt. This triumvirate of forces is causing commodity prices to fall and impeding the ability of industries to re-balance in the post-boom period. Show More

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Only those that innovate will survive

Watermark Funds Management

Utilities are one of the last sectors to come to mind with respect to technological innovation – yet the entire industry is currently being reshaped and the long-term sustainability of the incumbents’ business model is being called into question. Justin Braitling, CIO of Watermark Funds, says structural changes relating to... Show More


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