Single Sector Fund

Nikko AM Conservative Fund

About the fund

This fund aims for more modest investment returns which grow steadily over time, keeping ups and downs to a minimum. The fund does this by investing mostly in bonds and cash, but also has a moderate exposure to shares.

Risk Indicator (volatility)

Target Asset Allocation

Equities 27.50%
Bonds 52.50%
Cash 15.00%
Other 5.00%


As of 31 December 2021

Market Highlights

  • 2021 proved to be a year of divergent performance, some large movements in several areas of the financial markets and a number of unexpected events; however, the year did finish on a positive note for investors with equity, property and bond markets moving higher over the month of December.
  • The NZ dollar generally trended lower over the year meaning that investors with foreign currency assets benefitted (in NZ dollar terms) from their offshore exposure, but this modestly pulled back in December with the NZ dollar rising slightly against a basket of currencies. 


The strategy underperformed its benchmark for the quarter, but outperformed its benchmark over the month, with most sectors delivering returns above their respective market indices.  Particularly strong was Core Fund being 0.9% ahead for the month and 3% ahead for the year.  Global shares also performed well ahead of the benchmark but struggled to keep pace with the growth of the market over the full year.  With fixed income markets struggling over the year, the fund returned a modest 1.4% which is below our long-term expectations.  However, with higher yields the forward-looking expectations for the fund are modestly higher now than they were a year ago. We do not expect the levels of divergence between the NZ and global markets to continue at the levels observed during 2021, but there are a number of factors which will likely lead to ongoing volatility in markets.  Most obviously the way that different central banks and economies face and deal with higher inflation will play a role, as will the ongoing pandemic saga.  Along with heightened geo-political tensions in eastern Europe and the South China Sea, it’s possible to argue for a wide range of investment outcomes in 2022.  The fund will approach this environment focused on its core strategy and will be managed with a medium to long term perspective being diversified both across and within sectors to help dampen volatility whilst achieving its investment objective.



Nikko AM Investment Scheme
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at 31 December 2021
One month Three months One year Three years (p.a) Five years (p.a)
Fund performance1 1.07% 0.17% 0.81% 6.36%
Appropriate Market Index (AMI)2 1.15% 0.70% 1.83% 6.41%
  1. Returns are before tax and after the deduction of fees and expenses and including tax credits (if any).
  2. AMI:Composite - refer to Nikko AM NZ Investment Scheme OMI

5 year cumulative performance $10,000 invested

Top 10 Holdings

Security Name Percentage
JPM Multi Manager Alternatives X Acc NZD Hedged 4.88%
NZ Govt Inflation Index Bond 20/09/25 2.04%
Japan Government 110422 0.0 Gb 2.02%
Kommunalbanken AS 1.25% 02/07/2030 1.34%
Westpac NZ 1.439% 02/24/26 1.32%
Fisher & Paykel Healthcare 1.21%
Housing NZ 3.42% 18/10/2028 1.12%
Kiwibank Ltd 2.155% 20/09/2024 1.02%
Microsoft Corp USD0.00005 1.01%
ASB Bank Ltd 040526 1.646 Cb 0.97%

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