Single Sector Fund

Nikko AM ARK Disruptive Innovation Fund

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About the fund

This fund provides access to a global share portfolio that offers thematic exposure to disruptive innovation across a number of sectors and geographies.

Disruptive innovation is caused by the introduction of new technologically enabled products or services that permanently change an industry or economic sector by providing greater simplicity, accuracy, customisation and accessibility while driving down costs.

Risk Indicator (volatility)

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7 Extremely high

Target Asset Allocation

Growth 100.00%

Commentary

As of 28 February 2025

Market Overview

  • February was a ‘month of two halves’, with the strong returns seen in January continuing into the first two weeks of the month, before investor sentiment turned and global equity markets moved lower.
  • In the US earnings per share growth for S&P500 companies was 12% for 4Q2025, ahead of expectations for 8% growth.
  • Europe and UK equity markets, as well as Hong Kong and China, continued their strong start to 2025, while the US was once again a laggard versus the broader market. New Zealand and Australian equities were also weak, falling 3% and 4% respectively.

Fund Commentary

Key contributors for the month include Palantir (PLTRP), Pinterest (PINS) and Spotify (SPOT).

Shares of Palantir Technologies contributed to fund performance this month following a strong earnings report that showcased significant growth in U.S. customers and commercial revenue. The stock surged as the company reported an increase in U.S. commercial revenue year-over-year and provided an optimistic outlook for fiscal year 2025, indicating continued demand for its AI-driven platforms, particularly from government clients. Notably, concerns surrounding U.S. government budget cuts negatively impacted Palantir's share price exiting the month. Shares of Pinterest contributed to the fund this month after the company reported strong fourth-quarter earnings, including year-over-year revenue growth and an increase in global monthly active users. Shares of Spotify contributed to the fund this month after the company reported strong fourth quarter earnings, highlighted by revenue growth year-over-year on an FX neutral basis, and monthly active users (MAUs) growing year-over-year across all regions.

Key detractors for the month include Tesla (TSLA), Coinbase (COIN) and Block (XYZ).

Shares of Tesla detracted from performance during the month amid concerns about slowing EV adoption linked to Elon Musk's political involvement. Meanwhile, Tesla continued to advance its Full Self-Driving (FSD) software, launching FSD Supervised Beta in Mexico and FSD-like smart driving features in China, remaining on track to launch a commercial robotaxi service in Austin in June. Later in the month, Tesla began delivering the refreshed Model Y in China, with US deliveries set to start in early March. Shares of Coinbase detracted from the fund this month, largely tracking the decline in the price of Bitcoin over the past month. However, the company reported strong fourth quarter earnings, with net revenue growth year-over-year and trading volume growth year-over-year. The SEC also formally dropped its case against Coinbase, an important milestone that signals the end of former SEC Chair Gary Gensler's era of "regulation by enforcement" and marking a more progressive approach to digital assets regulation in the United States. Shares of Block detracted from the fund this month after the company reported fourth-quarter results, including lower-than-expected revenue growth year-over-year. That said, Square, the company’s merchant platform, delivered solid performance, with Gross Payment Volume (GPV) growth accelerating year-over-year.

Performance

Nikko AM Investment Scheme
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Performance

at 28 February 2025
One month Three months One year Three years (p.a) Five years (p.a)
Fund performance1 -11.40% 2.28% 23.95% 2.28% 5.29%
Appropriate Market Index (AMI)2 -1.36% 5.68% 26.40% 21.69% 23.08%
  1. Returns are before tax and after the deduction of fees and expenses and including tax credits (if any).
  2. AMI: NASDAQ-100 Notional Net Total Return Index in NZD

Cumulative Returns Since Inception, $10,000 invested

Top 10 Holdings

Security Name Percentage
Tesla Motors Inc 7.89%
Roblox Corp 6.72%
Palantir Technologies Inc 5.99%
Roku Inc 5.98%
Coinbase Global Inc 5.83%
Shopify Inc 4.48%
Robinhood Markets Inc 4.33%
Meta Platforms Inc 4.14%
Tempus Ai Inc 3.82%
Block Inc 2.98%
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