Key Highlights

  • Macquarie Core Global Equity Fund (Hedged) ARSN 673 288 018, formerly Vanilla Fund No. 69, restructured December 1, 2025
  • Two unit classes launched: Class W and Active ETF class with ASX quotation from December 4, 2025
  • Operating profit AUD 5,700 for half-year ended December 31, 2025; net assets AUD 509,495K
  • Active ETF distribution: 0.36 cents per unit; Class W distribution: 0.05 cents per unit
  • Currency hedging provides AUD protection from foreign exchange movements in global equity portfolio

Introduction

The Macquarie Core Global Equity Fund (Hedged), formerly known as Macquarie Vanilla Fund No. 69, underwent substantial restructuring effective December 1, 2025, introducing two distinct unit classes and ASX quotation. The fund represents a professional global equity investment vehicle with currency hedging designed to provide Australian investors with international equity exposure while minimizing foreign exchange volatility.

This article analyzes the restructured fund's investment strategy, performance, distribution policy, and investment suitability for Australian investors seeking currency-protected global equity returns. The fund's transition to an active ETF structure provides investors with both traditional fund access and ASX-traded flexibility, catering to diverse investor preferences and trading styles.

About Macquarie Core Global Equity Fund (Hedged)

The Macquarie Core Global Equity Fund (Hedged) is a professionally managed investment fund providing currency-hedged exposure to global equity markets. The restructuring introduced significant operational changes, including conversion to an active ETF structure with ASX listing effective December 4, 2025.

The fund's key distinguishing feature is currency hedging, which protects Australian investors from AUD fluctuations against foreign currencies. Rather than experiencing gains or losses from exchange rate movements, investors focus exclusively on underlying global equity market returns. This feature appeals particularly to conservative investors, those near retirement, and those requiring predictable income.

Managed by Macquarie investment Management Australia Limited, the fund leverages institutional expertise and systematic investment processes to construct a diversified, currency-hedged global equity portfolio aligned with long-term investor objectives. The combination of professional management with currency hedging protection provides valuable benefits unavailable to investors managing global portfolios independently.

Why Currency Hedging Matters for Australian Investors

Currency fluctuations significantly impact international investment returns. A weakening Australian dollar enhances global equity returns when converted back to AUD, while a strengthening dollar reduces them regardless of underlying market performance.

Currency hedging removes this source of volatility, allowing investors to focus exclusively on global equity market returns. For investors uncomfortable with currency risk or those requiring stable income and capital, currency-hedged international exposure provides valuable portfolio construction benefits. The costs of hedging are offset by elimination of currency uncertainty.

The trade-off involves hedging expenses but these costs eliminate the uncertainty surrounding FX movements. This trade-off appeals to conservative investors prioritizing stability or those with specific currency risk management objectives. Sophisticated investors understand this exchange and value stability enough to accept modest hedging costs.

Active ETF Structure and ASX Quotation

The restructuring created two unit classes: traditional Class W and an active ETF class, both traded on the ASX since December 4, 2025. This dual structure provides investors with flexibility in accessing the fund through either traditional platforms or exchange-traded mechanisms depending on investor preference and advisor capability.

The active ETF structure maintains active management characteristics while providing transparent, exchange-listed trading. This approach offers benefits of both traditional managed funds and passive ETFs, combining MIMAL's active security selection with ETF-style liquidity and pricing. Investors gain the flexibility to trade during market hours at transparent prices while retaining active management expertise.

ASX quotation since December 4, 2025, provides direct market access and transparent pricing. Investors can monitor fund unit prices in real-time through ASX quotes and trade during market hours through brokers. This accessibility and transparency provide advantages over traditional managed funds where units are priced once daily.

Financial Performance (Half-Year Ended December 31, 2025)

For the half-year ended December 31, 2025, the Macquarie Core Global Equity Fund (Hedged) reported operating profit of AUD 5,700, derived from total income of AUD 5,897 and total expenses of AUD 197. These impressive cost metrics demonstrate operational efficiency and effective fund management.

Total income comprised distribution income of AUD 256 and net gains on financial instruments of AUD 5,641, reflecting positive equity market performance and portfolio management gains. The substantial gains on financial instruments demonstrate that the underlying global equity portfolio achieved solid returns during the December half-year period despite global market volatility. Expense control is remarkable, with total costs of only AUD 197, comprising management fees (AUD 95) and performance fees (AUD 102).

Net assets attributable to unitholders totaled AUD 509,495K, while total assets reached AUD 520,052K. The portfolio comprised cash (AUD 4,112K) and financial assets (AUD 515,867K), reflecting a fully invested global equity positioning with minimal cash drag. The fund's substantial asset base (over AUD 500 million) provides significant scale for efficient portfolio management and operational execution.

Distribution Policy and Yield

The fund offers distinct distributions across unit classes. Class W distributed 0.05 cents per unit, while the Active ETF class distributed 0.36 cents per unit for the period. The differential reflects different fee structures and investor bases between the traditional and ETF classes. The Active ETF's substantially higher distribution suggests orientation toward income-focused investors, while Class W caters to growth-focused investors.

Active ETF distributions are significantly higher, reflecting the class's orientation toward income-focused investors. Class W provides lower distributions, suitable for growth-oriented investors preferring capital appreciation over income. Investors should evaluate their income needs and tax efficiency considerations when selecting between classes.

Distributions are derived from fund earnings, including investment income, capital gains, and performance fees. Investors should review distribution compositions to understand tax implications across different assessment categories. Capital gains distributions may have different tax treatment than income distributions, depending on investor circumstances.

Investment Risks for Fund Investors

  • equity market risk: Global equity valuations decline during economic slowdowns or market corrections
  • Hedging cost: Currency hedging involves expenses that reduce returns relative to unhedged portfolios
  • Interest rate risk: Rising rates can negatively impact equity valuations and hedging costs
  • Manager risk: Fund returns depend on MIMAL's active management and security selection skill
  • Liquidity risk: While ASX-traded, fund liquidity depends on market interest and bid-ask spreads

Long-Term Growth Drivers and Outlook

Global equity markets offer long-term growth driven by technological innovation, productivity improvements, and economic expansion. The fund's currency hedging provides stability while maintaining equity market exposure for growth. Hedging removes one source of volatility without eliminating market risk, providing a balanced profile for conservative long-term investors.

Artificial intelligence, digital transformation, renewable energy, and healthcare innovation represent significant secular growth themes accessible through global equity portfolios. The fund positions investors to benefit from these long-term trends without currency volatility. Investors maintain exposure to equity appreciation while shedding currency uncertainty.

For investors with 5+ year horizons, currency-hedged global equity exposure provides compelling risk-adjusted returns compared to domestic-only Australian portfolios or unhedged international exposure where currency uncertainty adds volatility without necessarily improving returns.

Hedged vs. Unhedged Global Equity: Which Is Right for You?

Unhedged international portfolios benefit from AUD weakness, which enhances returns when foreign currency gains exceed equity market fluctuations. However, unhedged portfolios also experience losses from AUD strength, which can be substantial and unpredictable. Over long periods, AUD currency movements appear somewhat random, suggesting currency hedging reduces portfolio volatility without sacrificing expected returns in the long term.

Hedged portfolios eliminate this currency volatility, providing pure global equity market exposure. The trade-off involves hedging costs, which typically reduce returns by 0.3-0.8% annually. Investors must weigh whether eliminating currency risk justifies these costs. For conservative investors, the cost-benefit analysis clearly favors hedging, while aggressive investors might accept currency volatility to avoid costs.

Conservative investors, those nearing retirement, or those requiring predictable income often prefer hedged structures. Growth-oriented investors with long time horizons may accept currency volatility to avoid hedging costs and gain potential upside from AUD weakness. Individual circumstances and risk tolerance should guide this important allocation decision.

Questions Investors Are Asking About Macquarie Core Global Equity Fund (Hedged)

What is currency hedging and how does it work?

Hedging uses financial instruments to lock in current exchange rates, eliminating profit or loss from AUD/foreign currency fluctuations. This removes currency volatility while maintaining equity market exposure.

Why would I invest in the hedged version versus unhedged?

Hedged portfolios provide stable global equity returns without FX volatility. Unhedged portfolios offer upside from AUD weakness but downside from AUD strength.

What are the distributions for each unit class?

Class W distributed 0.05 cents per unit; Active ETF class distributed 0.36 cents per unit for the half-year ended December 31, 2025.

How does the ASX trading work for this fund?

The Active ETF class is ASX-listed since December 4, 2025, allowing trading through brokers during market hours with transparent, real-time pricing.

What is the fund's asset base?

Net assets to unitholders totaled AUD 509,495K as of December 31, 2025, providing substantial scale and liquidity.

Does currency hedging cost anything?

Yes, hedging involves management costs approximately 0.3-0.8% annually. These costs reduce gross returns but eliminate currency uncertainty.

Is this fund suitable for retirement planning?

Yes, hedged global equity suits investors prioritizing stable, predictable returns in retirement or near-retirement portfolios.

How often are distributions paid?

Distribution frequency is specified in the fund's PDS. Review the PDS for specific timing details.

Can I redeem units or must I sell on the ASX?

Class W units can typically be redeemed with the fund; Active ETF units are sold on the ASX.

How does the fund compare to international ETFs?

This active fund combines active management with hedging and ETF trading flexibility, differentiating it from passive international ETFs.

Implementation Considerations: ASX Trading vs. Traditional Fund Access

The Macquarie Core Global Equity Fund (Hedged) offers two access methods: ASX-listed Active ETF class or traditional Class W units. Each approach offers advantages and disadvantages depending on investor preferences, trading patterns, and custodial arrangements. Understanding these differences helps investors select the most suitable access method.

ASX-listed Active ETF trading provides intraday liquidity, real-time pricing, and the ability to trade through any broker. Investors can sell units during market hours at transparent prices displayed on the ASX. This flexibility appeals to active traders or those requiring quick access to capital. ASX trading also enables short selling and options strategies for sophisticated investors seeking tactical positioning.

Traditional Class W unit access involves dealing with the fund manager directly, typically with daily or weekly unit pricing. Redemption usually takes several days to settle, providing less immediate access to capital. This structure suits buy-and-hold investors who don't anticipate frequent trading and prefer traditional fund operating procedures.

Transaction costs differ between methods. ASX trading involves brokerage commissions and bid-ask spreads, which can be small for actively traded funds like the Active ETF class. Traditional fund dealing may involve entry or exit fees, though many modern funds have eliminated these charges. Compare total transaction costs before selecting an access method.

Tax efficiency may also differ. ASX-listed units may benefit from franking credit treatment or other tax efficiencies compared to traditional fund structures. Consult your tax advisor to understand implications for your specific circumstances. Professional investors often optimize access methods to minimize tax leakage.

Conclusion

The Macquarie Core Global Equity Fund (Hedged) offers Australian investors professional access to currency-protected global equity markets through a restructured, ASX-quoted active ETF. The December 2025 restructuring introduced dual unit classes and exchange listing, providing flexibility for different investor types.

With net assets exceeding AUD 509 million, substantial distributions, and professional management by MIMAL, the hedged global equity fund merits consideration for conservative or income-focused investors seeking international equity exposure without currency risk. The Active ETF structure combines the benefits of active management with ETF-style trading and transparency, providing modern portfolio access for sophisticated Australian investors.