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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
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Buyside Digest is not affiliated with, and does not endorse, Airlie Australian Share Fund. This analysis is provided for institutional research purposes only and is not investment advice.
"Airlie delivered 10.6% in Q2 2026, outperforming by 6.5% as materials and USD earners reversed prior headwinds. The fund maintains a large underweight in expensive Australian banks facing deteriorating fundamentals from slowing credit growth and negative gearing bans, expecting earnings downgrades and de-rating."
The Airlie Australian Share Fund returned 10.6% for the quarter net of fees, outperforming the S&P/ASX 200 by 6.5% after fees, though the fund underperformed by 2.0% for the full fiscal year. The quarter saw a sharp reversal of headwinds that had weighed on performance, with materials holdings (BHP, RIO, BlueScope, Ampol, IGO) rallying over 50% as markets scrambled for real assets, and USD earners (Aristocrat, Resmed, News Corp) rebounding as the AUD peaked. The manager maintains a large 10% underweight in Australian banks, viewing them as overvalued heading into a deteriorating outlook with rising rates slowing credit growth, aggressive competition from Macquarie, and the Federal Budget's ban on negative gearing threatening investor loan margins. The manager expects earnings downgrades and P/E de-rating for banks to create a headwind for the index, while seeing best opportunities in quality industrials like Car Group, Pinnacle, Orica, News Corp and Resmed that have de-rated sharply but offer strong EPS growth. The changing market structure with increased passive and quantitative strategies is creating enhanced volatility that the manager views as opportunity rather than threat, as demonstrated by adding to BlueScope and James Hardie following MSCI index deletions, with both positions subsequently up 48%.
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