Active Income Portfolio

For those seeking a sustainable income strategy, with a difference.

8.89% Returns pa since inception to 31-8-21

About the Active Income Portfolio

Our philosophy at Market Matters has always been around active management, and our income portfolio stays true to label. Combining an active approach to income producing equities, ETFs and listed Income Securities such as Hybrids, the portfolio will satisfy those looking for sustainable income with significantly less volatility than the market.

**Portfolio Performance** UPDATED 31/08/2021 19:00
Portfolio	1M	3M	6M	1Y	3Y pa	ITD pa*
Active Income Portfolio	2.83%	4.60%	10.70%	21.45%	9.29%	8.89%
Target 7%	0.58%	1.75%	3.50%	7.00%	7.00%	7.00%
Difference	+2.25%	+2.85%	+7.20%	+14.45%	+2.29%	+1.89%

* Inception date 05/07/2017

**Portfolio Holdings** UPDATED 14/09/2021 16:30 trade now
COMPANY CODE	STOCK NAME	WEIGHT (%)	RISK	TIME HORIZON	ENTRY DATE	ENTRY PRICE ($)	LAST PRICE ($)	DIVIDENDS ($)	GAIN / LOSS (%)
ANZPI	ANZ Capital Notes 6	4	Low	Long	8/07/2021	100	102.4		2.4
AWC	Alumina Ltd	4	Moderate	Medium	13/09/2021	2.2	2.16		-1.82
BHP	BHP Group Ltd	5	Low	Long	11/12/2019	37.73	41.73	8.21	32.36
CBA	Commonwealth Bank of Australia	7	Moderate	Medium	13/03/2020	61.33	101.58	6.05	75.49
CBAPG	Commonwealth Bank Hybrid	5	Moderate	Medium	9/04/2018	100	104.24	14.24	18.48
CWNHB	Crown Resorts Ltd	4	Moderate	Medium	26/05/2021	98.26	85.65	1.88	-10.92
DXS	Dexus/AU	4	Low	Long	10/03/2021	9.2	10.77	0.23	19.57
IAG	Insurance Australia Group Ltd	6	Moderate	Medium	21/10/2020	4.69	5.24	0.13	14.5
IFL	IOOF Holdings Ltd	6	Moderate	Medium	7/10/2020	3.59	4.42	0.23	29.53
IGL	IVE Group Ltd	3	Moderate	Medium	18/06/2018	2.28	1.62	0.54	-5.26
MTS	Metcash Ltd	5	Moderate	Medium	9/12/2020	3.5	3.96	0.25	20.29
MXT	MCP Master Income Trust	5	Low	Long	9/10/2017	2	2.07	0.37	22
NAB	National Australia Bank Ltd	7	Moderate	Long	27/08/2020	18.71	28.23	1.35	58.1
NABPF	National Bank Hybrid	5	Low	Long	21/03/2019	100	107.1	11.45	18.55
NSR	National Storage REIT	4	Moderate	Medium	5/05/2021	2.04	2.36	0.04	17.65
SIQ	SmartGroup Corp Ltd	5	Moderate	Medium	25/02/2020	6.98	7.75	0.73	21.49
SSM	Service Stream Ltd	3	High	Medium	20/01/2021	1.77	0.84	0.04	-50.28
TCL	Transurban Group	4	Moderate	Medium	2/04/2020	11.82	13.82	0.38	20.14
TLS	Telstra Corp Ltd	5	Moderate	Medium	7/09/2020	3.19	3.96	0.16	29.15
XARO	ActiveX Ardea Real Outcome Bon	5	Low	Long	21/10/2019	26.47	25.84	1.3	2.53

Portfolio cash position: 4%

**Recent Sales** UPDATED 13/09/2021 17:00 trade now
Company code	STOCK NAME	WEIGHT(%)	RISK	TIME HORIZON	ENTRY DATE	ENTRY PRICE ($)	CLOSE PRICE ($)	DIVIDENDS ($)	GAIN / LOSS (%)
TLS	Telstra Corp Ltd	3	Moderate	Medium	7/09/2020	3.19	3.91	0.16	27.59
RIO	Rio Tinto Ltd	5	Moderate	Medium	14/05/2019	94.42	124.8	14.61	47.65
AMPPB	AMP Ltd	4	Moderate	Medium	24/12/2019	100	97.61	5.94	3.55
SUL	Super Retail Group Ltd	4	Moderate	Medium	20/01/2021	11.95	12.1	0.47	5.19
WES	Wesfarmers Ltd	5	Moderate	Medium	15/05/2020	37.3	54.98	2.61	54.4
NBI	NB Global Corporate Income Tru	5	Low	Long	26/09/2019	2	1.86	0.17	1.5
NAB	National Australia Bank Ltd	3	Moderate	Long	16/03/2021	18.71	26.27	0.49	43.03
ABP	Abacus Property Group	4	Moderate	Medium	10/03/2021	3.9	2.7	0.09	-28.46
SYD	Sydney Airport	4	Moderate	Long Term	20/01/2021	5.63	6.1		8.35
CLW	Charter Hall Long WALE REIT	4	Low	Long Term	20/01/2021	4.85	4.5	0.15	-4.12
MQGPD	Macquaire Group	5	Low	Long Term	10/11/2020	100	104.8	7.38	12.18
PPT	Perpetual	3	High	Medium Term	7/10/2020	42.89	29	7.15	-15.71
SUL	Super Retail Group	3	High	Medium Term	7/09/2020	6.11	10.6	0.28	78.07
WBC	Westpac	7.5	Moderate	Medium Term	27/08/2020	27.88	17.56	1.14	-32.93
WPL	Woodside Petroleum	4	Moderate	Medium Term	12/08/2020	34.6	20.41	1.93	-35.43
XARO AXW	ActiveX Ardea Real Outcome Bond	5	Low	Long Term	15/05/2020	26.47	26.9	0.18	2.3
SKI	Spark Infrastructure	4	Moderate	Medium Term	4/05/2020	2.16	1.87	0.11	-8.33
SGP	Stockland	3	Moderate	Medium Term	15/04/2020	4.47	3	0.14	-29.75
MTS	Metcash	4	Moderate	Medium Term	27/03/2020	2.62	3.11		18.7
NAB	National Australia Bank	5	Moderate	Medium Term	13/03/2020	30.12	15.74	6.15	-27.32
CBAPF	CBA Capital Note Mar-22	5	Low	Long Term	25/02/2020	101.85	103.3	14.1	15.27

OPINION
ACTION

Recent Opinion for the Income Portfolio

17/09/2021 09:33

National Australia Bank (NAB) $28.20

NAB has outperformed in the Banking Sector over the last 3-months rallying 4.4% compared to say ANZ Bank (ANZ) which has fallen 4.6%. At MM we are hoping to increase our exposure to the sector via VUK at lower levels and while a pullback in NAB wouldn’t surprise after this month’s fresh multi-year high we have no interest in risking losing our position here, especially with a healthy dividend due in November.

17/09/2021 09:30

Commonwealth Bank (CBA)

A less dramatic example was set by Commonwealth Bank (CBA) in August, before it traded ex-dividend in similar fashion to FMG. MM flagged this likely move for CBA and trimmed our banking exposure accordingly – we currently only have a combined 10% exposure to CBA & NAB in our Flagship Growth Portfolio compared to the sectors market weighting of around 20%.

16/09/2021 17:01

Telstra (TLS) $3.95

TLS +0.51%: Held a strategy day to announce their T25 strategy which sounds impressive and the update was. This is clearly a company with better times ahead and the tough decisions taken in recent years are starting to pay off. Their key targets are for mid-single digit underlying EBITDA and high-teens underlying earnings per share (EPS) growth out to FY25...

16/09/2021 09:23

The Banking Sector

Secondly, as previously flagged MM has been watching UK based bank Virgin Money (VUK) into recent weakness i.e. over the last month NAB has rallied 1.5% while VUK has fallen 5%, not spectacular but still a useful performance differential if compounded over the year. MM has moved underweight the Banking Sector holding just 5% in CBA and NAB respectively...

14/09/2021 09:32

Transurban (TCL) $13.80

MM is holding TCL in our MM Income Portfolio, it has very similar rationale to SYD plus there are no foreign ownership caps which makes is an easier proposition for overseas suitors. Interestingly the TCL chart looks like a carbon copy of SYD before the takeover activity unfolded.

13/09/2021 12:07

Active Income Portfolio – Amendments

We are reducing Telstra (TLS) in the portfolio today to make room for a new purchase.

10/09/2021 09:32

Commonwealth Bank (CBA) $100.55

CBA managed to hold above its August low and it appears to be gaining support in the $100 region, our view hasn’t changed towards Australia’s premier bank i.e. we see major support 4-5% lower.

03/09/2021 09:28

Insurance Australia Group (IAG)

MM followed our improved outlook towards insurance via buying IAG in mid-August, we remain happy with this purchase believing the stocks great value under $5.50.

03/09/2021 09:23

BHP Group (BHP) $41.94

BHP traded ex-dividend yesterday with the share price closing over 20% below its July high – the combination of tumbling iron prices, a $5.7bn investment in Potash, unification of its’s listing structure and BHP’s planned petroleum demerger with Woodside (WPL) has weighed on the share price in a major fashion. Interestingly both BHP and WPL...

02/09/2021 09:41

The Banks

The Banking Sector thrives on a strong property market as they enjoy steady margins with low bad debts, we believe todays ideal environment can be maintained for the coming year, or two minimum. However the current strong tailwind is clearly built into todays prices at least to a certain degree with the likes of CBA doubling in under 2-years, posting fresh all-time highs in the process.