Canopy Investors shuts doors, winds up fund

Canopy Investors is shutting its doors three years since launching and is in the process of winding up its flagship Global Small & Mid Cap strategy.

The Bennelong Funds Management boutique was launched in early 2023 by Magellan Financial Group veterans Kris Webster and Michael Poulsen.

The Canopy Global Small & Mid Cap Fund aimed to deliver investors double-digit annual returns over rolling five-year periods, while minimising the risk of permanent capital loss.

Bennelong chief executive John Burke said the decision was made after careful consideration, noting: "Bennelong Funds Management Limited (BFML) and Canopy Investors (Canopy) have made the decision to wind up the Canopy Global Small & Mid Cap Fund and to conclude the partnership between BFML and Canopy."

"The decision is not an easy one, however as responsible entity BFML has a duty to act in the best interests of unitholders, and the fund has not been able to achieve the scale required to achieve its aim," he said.

"All funds will be returned to unitholders, who have been notified of the wind up and termination of the fund. Subject to the statutory notice period under the Corporations Act, the fund is expected to commence winding up on June 22."

In the 2026 half year, the fund achieved -9.2% net of fees, which lagged 15.8% below the benchmark's return of 6.7%.

Incepted in June 2024, the fund invested in 20 to 40 high-quality, global small- and mid-caps trading at attractive prices. It charged a management fee of 1.15% p.a.

"This has been a disappointing period of both absolute and relative performance, and one that we believe has been characterised by the market's rotation away from the quality stocks the fund focuses on...," the latest performance update read.

"While the fund's recent results have been difficult, we are encouraged by both the underlying performance and enduring quality of our portfolio companies and the valuations at which they currently trade, which we believe have created a collection of the most attractive investment opportunities we have seen."

Key contributors during the period were Medpace, Moncler and Assa Abloy. Detractors were Auto Trader, Trex and Tradeweb.

Webster and Poulsen worked together for more than a decade at Magellan leading the small- and mid-cap team.

Webster spent nearly 15 years at Magellan, finishing up there as head of global investments.

Poulsen worked at Magellan for over a decade, serving the final nine months as co-portfolio manager of the Magellan High Conviction Fund as well as its small- and mid-cap strategy.

Jack McManus joined the boutique as a portfolio manager in July 2024, having also worked at Magellan in the global listed equities teams as a senior analyst. He was a member of the investment committee in the global, small and mid-cap, and emerging growth teams.

Emmily Lau joined Canopy one year ago as an investment analyst, previously working as an analyst with Platinum Asset Management for its international fund. She previously worked at Perpetual in global equities.

Burke added: "On behalf of BFML, I want to acknowledge Kris Webster, Michael Poulsen, Jack McManus and Emmily Lau, who have brought genuine conviction and skill to their work. The outcome here reflects market demand, not the quality of the team or their investment approach. We thank them sincerely for their efforts and partnership."

Last July, Bennelong ended its partnership with Touchstone Asset Management as the Touchstone Index Unaware Fund wound up two months earlier.

Touchstone officially shuttered after launching in 2015 by principals Jack Chemello, Suellen Morgan and Mary Feros. At its height, it had some $3.5 billion in funds under management.