Key Takeaways
- • L1 Long Short Fund Limited (ASX: LSF) delivered a net quarterly return of 12.7% for the June 2026 quarter, outperforming the S&P/ASX 200 Accumulation Index by 8.7 percentage points (4.0% benchmark return).
- • One-year net return reached 45.4%, representing 39.3 percentage points of outperformance against the benchmark's 6.1% return, with annual share price appreciation of 47% versus the ASX 200's 1% gain over the same period.
- • Since strategy inception in September 2014, the fund has delivered 20.2% annualized returns compared to 8.0% for the ASX 200 Accumulation Index, positioning it as Australia's best-performing long short equity fund over that 12-year period.
- • Thirteen individual stock positions each contributed more than 0.5% to quarterly returns, though gold and uranium exposures acted as performance headwinds during the quarter.
- • Key monitoring points for investors include RBA rate decisions, oil price volatility stemming from U.S.-Iran tensions, and the fund's median long position valuation standing at 10x price-to-earnings.
Summary
L1 Long Short Fund Limited, a listed investment company managed by L1 Capital and trading on the ASX under ticker LSF, has demonstrated substantial outperformance in the June 2026 quarter, reporting a net portfolio return of 12.7% against the S&P/ASX 200 Accumulation Index's 4.0% return. This 8.7 percentage point quarterly outperformance extends a broader pattern of strong relative performance that has defined the fund's track record since its strategy inception in September 2014.
The fund's one-year performance metrics underscore its consistent ability to generate alpha. Over the twelve-month period ended June 30, 2026, LSF posted a 45.4% net return, substantially exceeding the benchmark's 6.1% gain and delivering 39.3 percentage points of outperformance. Share price appreciation over the same period reached 47%, compared to just 1% for the broader ASX 200 Index, reflecting both the underlying fund performance and potential valuation expansion. Since inception, the long short equity strategy has generated annualized returns of 20.2% per annum, more than double the ASX 200 Accumulation Index's 8.0% annual return, positioning LSF as the best-performing long short fund in Australia over this extended period.
During the June quarter, portfolio construction contributed meaningfully to returns, with thirteen individual stock positions each contributing more than 0.5% to quarterly performance. However, the fund faced headwinds from its commodity exposures, with positions in gold and uranium acting as performance drags during the quarter. The fund's long book remains positioned at a median valuation of 10x price-to-earnings, a metric that fund management has highlighted as worth monitoring in the context of evolving macroeconomic conditions.
Looking ahead, L1 Capital has characterized the macro environment as mixed, with several key risk factors warranting investor attention. These include potential RBA rate decisions and oil price volatility linked to geopolitical tensions between the United States and Iran. The fund's ability to sustain its substantial outperformance record in this environment will be a focal point for institutional investors evaluating the strategy's capacity to deliver risk-adjusted returns relative to its long short equity mandate.
The fund's one-year performance metrics underscore its consistent ability to generate alpha. Over the twelve-month period ended June 30, 2026, LSF posted a 45.4% net return, substantially exceeding the benchmark's 6.1% gain and delivering 39.3 percentage points of outperformance. Share price appreciation over the same period reached 47%, compared to just 1% for the broader ASX 200 Index, reflecting both the underlying fund performance and potential valuation expansion. Since inception, the long short equity strategy has generated annualized returns of 20.2% per annum, more than double the ASX 200 Accumulation Index's 8.0% annual return, positioning LSF as the best-performing long short fund in Australia over this extended period.
During the June quarter, portfolio construction contributed meaningfully to returns, with thirteen individual stock positions each contributing more than 0.5% to quarterly performance. However, the fund faced headwinds from its commodity exposures, with positions in gold and uranium acting as performance drags during the quarter. The fund's long book remains positioned at a median valuation of 10x price-to-earnings, a metric that fund management has highlighted as worth monitoring in the context of evolving macroeconomic conditions.
Looking ahead, L1 Capital has characterized the macro environment as mixed, with several key risk factors warranting investor attention. These include potential RBA rate decisions and oil price volatility linked to geopolitical tensions between the United States and Iran. The fund's ability to sustain its substantial outperformance record in this environment will be a focal point for institutional investors evaluating the strategy's capacity to deliver risk-adjusted returns relative to its long short equity mandate.
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