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RF1 - REGAL INVESTMENT FUND


blacksheep
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Currently in a trading halt.

 

RF1 is the listed investment trust of Regal Funds Management. Regal Funds are also known as "the king of shorts"

 

AFR are reporting "The corporate regulator is examining one of Australia's top hedge funds, Regal Funds Management, enquiring about its trading "in certain securities""

 

https://www.afr.com/markets/equity-markets/...20191126-p53e7e

 

Not the first time RFM has been investigated for its trading activities - RFM and Bell Potter received enforceable undertakings re their trading activities in Ten Holdings back in 2013

 

https://www.smh.com.au/business/banking-and...222-glt1ng.html

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Seems there is an ongoing legal case in the Federal Court of Australia - RNB Equities Pty Ltd v Credit Suisse Investment Services (Australia) Limited (No 2) [2019] FCA 1385.- of which CS is the 1st Respondent and Regal Funds management 2nd respondent in what appears to be trading in SYR back in 2013

 

https://www.judgments.fedcourt.gov.au/judgm...019/2019fca1385

 

 

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.... ASIC is conducting a preliminary investigation by way of a Search Warrant, in relation to the trading of certain securities...

 

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Sounds a little more serious than your average investigation - https://asic.gov.au/about-asic/asic-investi...thering-powers/

 

Our power to inspect and compel production of documents is different from the power we have to apply for and execute a search warrant. Search warrants are obtained only when there are compelling reasons to do so, such as when there is a risk that the documents we seek will be lost or destroyed after it is known an investigation is in progress. Search warrants are discussed further below.

 

Power to apply for a search warrant

We have the power to apply to a court for the issue of a warrant to search premises for books and records. The power to apply for a search warrant comes from a number of sources. We may apply for a search warrant under the ASIC Act, the Corporations Act or the Crimes Act 1914.

 

A search warrant will only be sought in a formal investigation when there has been approval by a senior ASIC officer to seek a search warrant. A magistrate or Justice of the Peace issuing the warrant must consider the evidence relating to the commission of the alleged offence. Execution of any search warrant issued at ASICâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s request is by the Australian Federal Police (AFP), with ASIC officers assisting.

 

We also have the power to seek the issue of warrants to obtain stored telecommunications data from service providers. Stored communications are messages that are not in the process of passing over a telecommunications system, rather they are being held on the equipment of a service provider. An example of a stored communication is an email message or an SMS that has already been delivered to the intended recipient and that is stored on the equipment of the service provider. Use of these warrants is subject to annual reporting to the Commonwealth Attorney-Generalâââہ¡Ãƒâ€šÃ‚¬ÃƒÆ’¢Ã¢Ã¢â€š¬Ã…¾Ãƒâ€šÃ‚¢s Department and review by the Commonwealth Ombudsman.

 

We do not have the power to apply for warrants to intercept telecommunications. The AFP can apply to seek warrants to intercept telecommunications for the purposes of investigations into suspected insider trading and market manipulation offences. As we also conduct investigations into these matters, we may work with the AFP to identify potentially appropriate matters for investigation by the AFP and support the investigation of those matters the AFP chooses to conduct.

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  • 2 weeks later...
  • 1 year later...

in the 18 months since last bit on RF1, the performance for this LIC has been strong. Regal’s $4.67 share price on Wednesday represents an 8 per cent premium to the $4.29 latest disclosed net asset value.

STRATEGY

 

The investment objective of RF1 is to provide investors with exposure to a selection of alternative investment strategies with the aim of producing attractive risk adjusted absolute returns over a period of more than five years with limited correlation to equity markets. Regal Funds Management Pty Limited’s investment philosophy is grounded in the belief that a diversified portfolio of assets, using a range of investment strategies and backed by long-term capital, is key to achieving superior risk-adjusted returns over the long-term.

 

The RF1 portfolio is constructed by the Manager using multiple investment strategies managed by it.

Wednesday, the $470 million listed investment trust reported its net asset value increased 6.7 per cent in April. That lifted the 12-month performance of the fund, which trades under the ticker RF1, to 108.5 per cent, while its average return since inception in mid-2019 is just shy of 40 per cent a year.

 

 

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  • 1 month later...

For Regal Investment Fund (ASX:RF1) and the declaration of its final distribution in respect to FY21.

 

The closed end unit trust structure ensures the vehicle and its beneficiaries are unburdened by the dilutive effects of capital inflows, with each respective interest in the Listed Investment Trust (LIT) being identified by the investor’s holding of units. However unlike LICs, in which earnings may be carried forward across reporting periods, with the Board of Directors determining the payout ratio; LITs are required to distribute all taxable net income to unitholders over the relevant financial year, which can result in volatile distributions between such periods. RF1 operates under the Attribution Managed Investment Trust (AMIT) regime and has posted a trailing 12 month increase in the net asset value (NAV) of 108.2%, as compared to a unit price increase of 136.8%, as at 30 April 2021. We anticipate a material final distribution on the basis of strong performance and high portfolio turnover in relation to FY21. Higher than expected distribution earnings, the absence of a smoothing effect and the fund’s capital growth profile makes for a compelling reinvestment argument.

 

Taking into account the time value of money, this could also result in compounded capital growth. We note the attractiveness of the trust’s distribution reinvestment plan (DRP), in which

(1) if the prevailing market price is ≥ NAV, plan participants will receive their distributions as newly issued units in the fund at the NAV price or;

(2) if the prevailing market price is < NAV, distributions on units subject to the plan will be used to acquire the fund’s units on-market.

 

This is non discretionary, being fundamentally built into the plan by the Responsible Entity. RF1 is currently trading at an indicative premium of 0.2%. On the basis of this premium being sustained, investors who elect to enroll in the DRP will receive new units at the ‘cheaper’ NAV price. Assuming RF1 continues to provide unit price and total returns in line with historical levels since inception, we forecast capital growth under distribution reinvestment as being highly accretive to unitholders. Note that this also assumes a like for like generation of dividend income and realised capital gains. An additional estimated 9.2% p.a. from inception to 26 May 2024 would be generated for those investors who fully reinvest distributions over this period.

 

https://www.sharecafe.com.au/2021/06/02/bel...-for-dividends/

 

 

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  • 2 months later...

Eligible unitholders in RF1 have the opportunity to increase their investment in the Fund via a 1 for 3 accelerated, pro rata, non renounceable entitlement offer at an offer price of $3.79.

 

The Entitlement Offer is comprised of an Accelerated Institutional Entitlement Offer and a General Entitlement Offer.

 

The Offer Price of $3.79 per unit represents a discount of 15.2% to the closing ASX price of RF1 of $4.47 on 05 October 2021. The Offer Price is equal to the NAV of the Fund as at 01 October 2021.

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