Ausbil's Winning Formula

One of the most successful in a new generation of Australian equity specialists, Paul Xiradis, the outspoken chief executive of fund manager Ausbil Dexia, is confident enough to make regular "calls" on sharemarkets, writes Associate editor Michael Pascoe. As Michael reports, the Ausbil Dexia approach has very little to do with the Warren Buffett school; on video Xiradis names the resource and retail shares he's accumulating for his $4 billion fund operation.

By Michael Pascoe ·
12 Dec 2005

PORTFOLIO POINT: Paul Xiradis says there is good value to be had in well diversified Australian resource stocks, including BHP, Minaro and Zinifex. He also singles out Harvey Norman as a stong investment opporunity in the retailing sector.

A star performer among the jostling throng of fund managers in recent years has been Ausbil Dexia ' a performance that has seen its funds under management surge from $1.9 billion at the start of the year to $4.6 billion now.

One of the innovations pursued by Paul Xiradis when he was made CEO was to offer the company’s services to retail customers as well as the institutional superannuation funds that are Ausbil’s bread and butter.

Ausbil Dexia is a long way from the Warren Buffet school of “buy and hold”, turning over about half its portfolio each year as it chases outperformance.

A "top down" investor, the eight-year old firm begins its investment process with a macro-economic view, which it then distills into sectors and, finally, individual stocks.

I asked Paul Xiradis for his current favourite stocks: some ideas for Eureka Report subscribers looking for investments to put in their Christmas stockings. As you can see in the accompanying video, he did not shirk from the challenge.

In the much longer audio interview to be published in our next edition, Xiradis goes into greater detail about how he invests and also explains why Ausbil Dexia is underweight on banks, listed property trusts and infrastructure, and holds no Telstra shares.

Ausbil calls itself a “style-neutral” investor, wed to neither “value” nor “growth” schools. Effectively, though, it’s a manager looking for value 12 months in advance ' an understandable aim when trying to stay ahead of the pack.