L1 Capital Long Short Fund Listed Investment Company

The L1 Capital Long Short Fund Listed Investment Company began trading on the Australian Securities Exchange on 24 April, 2018. The new LIC mirrors the investment strategy of the existing L1 Capital Long Short Fund.

After initially hoping to raise a maximum of $500 million, the company issued a supplementary prospectus which allowed it to raise $1.35 billion. That makes it one of the largest LICs to come to market.

The strategy

The LIC will invest in a portfolio of predominantly Australian and New Zealand securities, with up to 30% exposure to global securities. The Company's objective is to deliver strong, risk-adjusted returns to investors over the long term.

It uses a fundamental, bottom‑up research process to identify mispriced securities with the potential to provide attractive risk‑adjusted returns. It will aim to identify and invest in securities issued by high quality companies with attractive valuations. The manager looks for companies with passionate, honest capable management; attractive industry structure; favourable operating outlook; and strong balance sheets.

The LIC may also take short positions in securities the manager considers to be overvalued, of low quality and/or over‑geared. The LIC may also use derivatives to hedge the portfolio's market exposure, or to enhance returns (while attempting to limit potential capital losses).

The investment strategy has delivered returns of 36.9 per cent per annum since inception, placing it as one of the top performing long/short funds globally.