Small Cap Rotation Accelerates: Why Ausbil Is Shutting to New Money

Ausbil's Australian Small-Cap Fund is closing to new money as it nears its self-imposed capacity (about $700m). The team cites trading liquidity: too much capital makes it harder to build and exit positions in thinly traded names without moving prices. The fund's recent winners include Life360, Codan, Zip and Generation Development Group and performance has been stellar. Cumulative outperformance since 2020 and ~40% over the past 12 months versus a strong Small Ords tape.

Capacity discipline is a positive signal. Good small-cap managers cap assets because alpha in this part of the market comes from. . .