Comparing a fund against the STW ASX200 index tracking ETF (dividends reinvested, ignoring tax), is a pretty good comparison to "the market" (especially since the STW ETF is something you can actually invest in and achieve exactly the returns that the stats show!).
Over the past few years with strongly rising markets, the Navra funds have underperformed - taking profits does lead to lower upside when the markets keep going up.
When the markets go down, the Navra funds tend to fall less than the market - the cash they hold helps smooth out the returns, although as the fund starts to invest more as the market drops further, it does tend to follow the market down.
However, once the market starts to recover, the Navra fund starts to outperform again - a result of buying cheaply.
For this financial year so far, the Navra retail fund is outperforming the STW ETF by nearly 3% ... with similar results for the past 12 months (see attached chart), or visit:
Comparing Charts: NAV0001AU, STW
For the purposes of income generation, the Navra funds tend to be more consistent in their returns ... they pay quarterly distributions versus half-yearly for the STW ETF, while STW tends to pay much more in the June distribution than the December one.
However, because the Navra funds tend to pay out more income overall (as a percentage of total return), if you take the distributions as cash and don't re-invest, then you will get a much lower return overall in the long term with Navra, since there is a much lower buy-and-hold (growth) component compared to the STW ETF. That's the cost of investing for "income + a bit of growth" versus investing for "growth + a bit of income".
Naturally if you then consider after-tax returns, Navra will come out worse-off because there is more income to be taxed each year - but the point of the fund is that you are using that income to offset holding costs of negatively geared assets, thus the taxation side of things doesn't tend to come into it as much.
Overall, it seems like the Navra fund is good at paying regular income and lowers the volatility of the market somewhat, losing less than the market in a downturn - at the cost of not gaining quite so much in a rising market.
It will be very interesting to see how the fund performs during an extended side-ways period - this should theoretically be the sweet-spot for the fund, able to generate trading profits while the market doesn't really achieve much.
