Inside the Rope with David Clark

In this episode, David is joined by Rob Tucker, the founder and Portfolio Manager of the Chester High Conviction Fund, a strategy that since its inception in October 2013 has produced a return of 13.7% p.a. David and Rob discuss the strategy in depth, as well as Rob’s outlook on current markets. The Chester High Conviction Fund takes a high-conviction approach, choosing investments, where they have confidence in the high quality, predictable cash generation of the company, or they, have strong confidence in the valuation margin of safety. The team believe that finding unloved, underappreciated or undiscovered investments has been the most consistent source of capital growth for the strategy over 8 years. Rob founded Chester Asset Management in 2017. Prior to Chester, Rob spent 7 years at SG Hiscock and was most recently the portfolio manager of the SGH Australia Plus product, a 25-40 stock Australian Equity portfolio with a mid-cap bias, that was run in the same manner as the Chester High Conviction Fund.

Juan Penelas joins David to discuss e360 Power, a Texas-based asset management firm founded in 2009 designed to generate superior absolute returns through fundamental discretionary trading strategies in the North American electricity, global natural gas and related energy futures & options markets. Since its inception in November 2009 to October 2022, the strategy has returned 36.2% per annum (AUD), Juan is a member of the Investment Committee and a Portfolio Manager with trading responsibility across power and related portfolios including power volatility. Prior to establishing e360 Power, Juan was a senior power and gas trader at Griffon Energy Capital, LLC ("GEC") where he co-headed the power desk. Prior to joining GEC, Juan was the head of PJM Power Cash Trading for American Electric Power Energy Service (“AEP”). Juan has worked internationally in the energy and metal industries in a range of finance related roles. Juan has a degree in engineering (BS/MS) from the Universidad de Buenos Aires and an MBA from the Wharton School of the University of Pennsylvania.

Andrew joins David to discuss the Longreach Energy Income Fund, a fund that targets a total return of 20% p.a. (net of fees) inclusive of an income return target of 8% p.a. by investing in US energy through real assets, such as producing land and mineral interests. As economies transition towards a future global energy mix increasingly powered by renewable energy, Longreach argue that natural gas offers the most sustainable bridge to greener technologies. Throughout the episode, Andrew covers the investment opportunity available in US natural gas assets, and in particular how this compares to global counterparts including Australia. Andrew has extensive principal investment experience in global upstream gas and oil, gained during a career that has seen him co-found and lead the London office for the gas and oil investment division of Macquarie Bank. He has particular expertise in transaction execution, financial modelling and structuring investments as well as identifying attractive projects and evaluating the commercial potential of assets.

Cameron joins David to discuss his career to date, including his studies in engineering at MIT, as well as the origins of Pacific Equity Partners (PEP), and the current operating environment for investors in private assets. Cameron explains why he believes private equity has been able to consistently outperform listed equities over the past 20 to 30 years, including the importance of incentive structures to drive business performance. With approximately A$8.7 billion in assets under management, PEP is the largest and most active Private Markets Fund Manager in Australia. Cameron joined Pacific Equity Partners in 2002. Prior to joining PEP, Cameron spent three years with Bain & Company in Australia and North America. Previously, Cameron worked for seven years in the mining and construction industry in Australia, Asia and North America. He received an MBA from MIT Sloan, and a MEng and BEng (First Class Honours) from the University of South Australia where he was a Graduate Society Scholar.

Suzanne joins David to discuss the benefits of using Private Equity in investor portfolios, including the asset class's performance when compared to their traditional listed equity counterparts. Suzanne is a managing director in Alternatives Capital Markets & Strategy (ACMS) within Goldman Sachs Asset Management, serving as global head of Private Equity Strategies. She also serves as global head of Launch With GS, Goldman Sachs’ $1 billion investment strategy grounded in the firm's data-driven thesis that diverse teams drive strong returns. She first joined Goldman Sachs as an analyst in 2001, and rejoined as an associate in 2005 in the AIMS Private Equity Investment team, focusing on secondaries through the AIMS Vintage Funds program. Suzanne was named managing director in 2012.

The Katch Litigation Finance Fund offers exposure to litigation funding with a focus on individual claims and investment scheme in the United Kingdom, an emerging financing solution which enables parties to pursue their legal claims without having to disburse the expenses of the lawsuit. Focusing on the latest stages of litigation funding, Katch identifies fairly safe cases with double-digit returns. Laurent has 20 years of investment experience in alternative asset management. Laurent’s previous experiences include responsibilities at Fidelis Insurance Holdings Ltd., a London and Bermuda based insurance company where he was group chief investment officer managing $1.5bn of assets. Previously, he was global head of investment at Platinum Capital Management Ltd., a global asset management platform, where his responsibilities included overseeing the firm’s actively managed funds (hedge funds, equities, volatility, and commodities).

Alisa Wood of KKR joins David to discuss the attractiveness of private assets in the current environment. Founded in 1975, KKR & Co. Inc. is a global investment company that offers alternative asset management as well as capital markets and insurance solutions. It manages investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. Alisa Amarosa Wood (New York) joined KKR in 2003 and is a Partner of the firm. She leads the Global Private Markets and Real Assets Strategies Group within the Client and Partner Group, looking after key product areas including private equity, infrastructure, energy real assets, impact, growth equity, real estate equity and credit, and customized products. She is also Co-CEO of KKR’s democratized private equity business.

Justin Borus, Founder and CEO of Ibex Investors, discusses the opportunities arising from the revaluation of technology companies, the strategy and outlook for the Ibex Israel fund, and the trends in companies and technologies emerging from Israel. Justin highlights the minimal impact of inflation on the fund's strategy and the upcoming shift towards private companies in the next 6-18 months.

Izzy Jensen is the founder and portfolio manager at Kakariki Capital, a specialist environmental and carbon commodities asset manager. After completing a Bachelor of Commerce at the Victoria University of Wellington, Izzy returned to Sydney to begin at the leading infrastructure manager, Morrison & Co, where she worked for seven years and was responsible for research and origination in carbon and environmental markets. Throughout the episode, Izzy and David discuss the founding of Kakariki Capital and more specifically, the Kakariki Carbon Fund 1.0. Izzy explains the unique value proposition of the fund, aiming to help decarbonise the planet while also delivering exceptional returns by investing in carbon credits. She highlights the recent switch that has occurred in the last 18 months, which has seen corporates get on the front foot regarding emissions reductions. Izzy and David also analyse and outline their outlook for the carbon space, comparing the markets for compliance and voluntary offsets. Izzy then responds to potential risks associated with the strategy and how the fund plans to combat these if they arise.

Adrian again joins the podcast to discuss the current economic environment and in particular, how it is impacting private debt and Merricks’ Partners Fund. Adrian is the CEO and CIO of Merricks Capital, responsible for the overall running of the business, acting as a group director and Chairman of the Investment Committee. Merricks has an impressive track record and has solidified itself as a leader in the private debt space in Australia. During the episode, Adrian discusses the current impact on and outlook for the private debt market in an environment of inflation, higher interest rates and a potential recession. He highlights the current valuation issue that exists in Australia, whilst explaining why there is not a simultaneous supply issue. Adrian and David also compare the private debt market in Australia to markets overseas and discuss the advantages that private debt lenders possess in relation to banks. Adrian then gives his outlook for the current development and building industry and how it is likely to play out given rising costs, fixed contracts and a consequent difficulty to deliver profits.