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In June 2026, the L1 Capital International (Unhedged) Active ETF posted a 1.8% return, trailing the MSCI World Net Total Return Index in A$ benchmark, which gained 3.1%. This report examines the fund's investment approach and performance metrics since its launch in March 2019.
Key Points
- L1 Capital International (ASX:L1I)
- June 2026 return of 1.8% compared to benchmark’s 3.1%
- Annualized returns since inception: 12.1% for the fund vs. 14.2% for the benchmark
- Investors should monitor global market shifts and potential fund strategy changes
June 2026 Performance Summary
The L1 Capital International (Unhedged) Active ETF achieved a 1.8% return in June 2026, underperforming the MSCI World Net Total Return Index in A$, which recorded a 3.1% gain during the same period. This shortfall underscores the challenges faced amid the current market environment.
The fund employs a high conviction strategy focusing on international equities, aiming to generate attractive risk-adjusted returns while minimizing permanent capital loss risks. Despite June’s underperformance, the fund remains committed to investing in high-quality companies with a long-term perspective.
Performance Since Inception
Since its inception in March 2019, the ETF has delivered an annualized return of 12.1%, trailing the benchmark’s 14.2% annualized return. This equates to a cumulative return of 130.7% for the fund versus 164.2% for the benchmark, resulting in a cumulative underperformance of 33.5 percentage points.
The investment approach centers on approximately 25 high-quality companies selected through fundamental, bottom-up analysis. The focus is on firms operating in well-structured, expanding industries with durable business models and strong capital allocation histories.
Portfolio Composition and Investment Strategy
The ETF invests across diverse sectors without imposing artificial 'Growth' or 'Value' constraints. Key sectors include semiconductors, payments, consumer discretionary, and financials.
Top holdings as of June 30, 2026, include AerCap, Alphabet, Amazon.com, and Nvidia. Geographically, the portfolio is concentrated primarily in North America (49%), followed by Western Europe (22%) and Asia Pacific (16%).
Sector and Market Capitalization Breakdown
Sector allocations are diversified, with semiconductors (14%), payments (13%), and consumer discretionary (12%) representing the largest exposures. This diversification aims to balance risk and seize growth opportunities across industries.
Regarding market capitalization, 57% of the portfolio is invested in large-cap companies valued over $100 billion, aligning with the fund’s strategy to focus on established businesses with strong growth potential.
Regional Revenue Exposure
Estimated revenue exposure by region shows North America leading at 49%, reflecting significant investment in market-leading companies. Western Europe and Asia Pacific contribute 22% and 16%, respectively, providing geographic diversification to enhance stability and growth potential.
Management and Fees
David Steinthal, Chief Investment Officer of L1 Capital International, manages the fund. The management fee is 1.20% per annum, inclusive of GST and net of RITC. Additionally, a 15% performance fee applies to returns exceeding the benchmark, with a high watermark to align interests with investors.
The fund operates under a dual registry structure, is unhedged, and focuses on listed securities globally with an emphasis on developed markets. The minimum initial investment is $25,000, and the fund is accessible via multiple investment platforms.
Market Environment and Fund Positioning
In a recent investor webinar, David Steinthal highlighted the fund’s focus on companies with strong cash flow generation and robust ESG practices to achieve sustainable long-term returns. The immediate impact of June’s performance on the share price remains unclear from public sources.
Investors are advised to watch for any strategic adjustments as market conditions evolve.
Outlook and Investor Considerations
As global economic conditions continue to change, investors should observe how L1 Capital International adapts its strategy to address market challenges and capitalize on opportunities. The fund’s emphasis on high-quality companies with durable business models supports its long-term growth potential despite short-term fluctuations.
Upcoming performance updates will be crucial for investors seeking insight into the fund’s trajectory and strategic direction, with future quarters providing greater clarity on its ability to meet investment goals.
