Small companies can grow faster and deliver better returns than their bigger colleagues. It makes sense that a small company has the ability to disrupt an industry or find a niche that allows it to grow at a faster pace. The enticing nature of this growth though comes with heightened risk, as we experienced earlier this year with the Corona crash when the Australian Small Ordinaries Index fell 41 per cent in less than 5 weeks. We also saw it in the Great Financial Crisis (GFC) when the same index plummeted 63 per cent in 15 months. No small company is too big to fail! 

The Level 18 Fund attempts to capture the great growth opportunities among the small companies listed on the Australian Securities Exchange while limiting the risk taken. 

The managers of the fund, Centennial Asset Management, have a significant portion of their investable capital in the fund and look to avoid experiencing major losses in any given period.

While markets gravitate up over time, and being exposed to the market is the norm, having the flexibility to be fully invested, hold unlimited levels of cash or even short sell stocks, dials down the risk profile. This provides a distinct alternative for investors.