System Capital | Fidante

About System

System Capital (System) is an absolute return global equities fund manager based in Melbourne and is majority owned by its investment team.

System’s philosophy and process focuses on understanding a business's strength within its business ecosystem. This ecosystem encompasses suppliers, customers, competitors, regulators, governments, and emerging market participants, all of which collectively influence the long-term economic performance of a business.

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Approach

Through deep industry analysis System’s process aims to identify companies with strong and growing cashflows over the medium term with a strengthening competitive position. System also identifies situations where a business’s structural position is weakening and not yet reflected in its valuation.

System has three key areas of focus:

core cashflow franchises, which provide predictable cashflows and bolster barriers to entry through strategic assets, network effects, or operational scale advantages;
digital infrastructure, essential for the digital economy with substantial pricing power and escalating barriers to entry as adoption grows;
and hidden value, denoting strong free cashflow businesses within conglomerates, often obscured by intricate capital structures or regulatory uncertainties.

By focusing on these factors, System aims to uncover businesses poised for sustainable growth and competitive advantage in their respective markets.

Our Funds

System Capital Long Short Fund

Alternatives

An actively managed absolute return portfolio focused on businesses with strong cashflow and improving competitive positions.

ESG

System Capital believes that a deep understanding of ESG issues can increase long-term returns and better manage risk in portfolios. ESG factors are integrated into System’s quality score framework and ecosystem analysis. Governance scores are used as a key determinant to assess each potential investment for inclusion in the portfolio. System also incorporates material environmental and social factors into our quality score framework as we believe that companies failing to adhere to best practice face higher risks of regulatory and economic disruption. System’s investment team actively monitor companies to ensure they continue to follow ESG best practices. Should a portfolio company diverge from best practice quality scores and valuation are reviewed and adjusted.