Key Takeaways
- • Regal Partners' Australian-focused hedge fund fell 18.9% in the year to the end of September 2026, per the AFR report.
- • The fund underperformed the S&P/ASX 300 Accumulation Index by 21.28 percentage points over the period.
- • Regal, led by Phil King and managing roughly $21 billion, attributes the weak returns to rising interest rates and the Australian sharemarket's limited exposure to the global AI rally.
- • The underperformance highlights the drag from Australia's relative absence from tech-heavy global indices during the period.
Summary
Regal Partners, the $21 billion investment firm led by Phil King, has blamed a difficult 12 months of performance on rising interest rates and on the Australian sharemarket being largely left behind in the global artificial intelligence trade, according to the Australian Financial Review.
The firm's Australian-focused hedge fund declined 18.9% in the year to the end of September. Over the same period it trailed the S&P/ASX 300 Accumulation Index by 21.28 percentage points, a gap that underscores the scale of the underperformance relative to the broader domestic market benchmark.
Regal's explanation centres on two macro factors. The first is a rising interest rate environment, which has weighed on valuations and market conditions. The second is the composition of the local market: the ASX has lagged more technology-weighted global indices, which have benefited disproportionately from the AI investment cycle. For a fund with an Australian mandate, limited exposure to that global rally translated directly into weaker relative and absolute returns.
The publication's headline frames the result as a 19% drop for the fund in a difficult year for the ASX. Further detail on positioning, redemptions or fund flows was not available in the source material reviewed.
The firm's Australian-focused hedge fund declined 18.9% in the year to the end of September. Over the same period it trailed the S&P/ASX 300 Accumulation Index by 21.28 percentage points, a gap that underscores the scale of the underperformance relative to the broader domestic market benchmark.
Regal's explanation centres on two macro factors. The first is a rising interest rate environment, which has weighed on valuations and market conditions. The second is the composition of the local market: the ASX has lagged more technology-weighted global indices, which have benefited disproportionately from the AI investment cycle. For a fund with an Australian mandate, limited exposure to that global rally translated directly into weaker relative and absolute returns.
The publication's headline frames the result as a 19% drop for the fund in a difficult year for the ASX. Further detail on positioning, redemptions or fund flows was not available in the source material reviewed.
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