Single Sector Fund
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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
This number indicates the relative 'risk' level of this fund based on the types of assets it is invested in, ranging from level 1 (least risky) to 7 (most risky).
| Risk category | Description of volatility |
| 1 | Very low |
| 2 | Low |
| 3 | Medium |
| 4 | Medium to High |
| 5 | High |
| 6 | Very high |
| 7 | Extremely high |
The risk indicators are calculated using returns of the funds, the returns of the fund’s market index or a combination of both, for the previous five years. Index returns or a mix are used if the fund has existed for less than five years. All Managers are required to use the same methodology so you can compare the risk of different funds if you are researching more than one manager.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | -0.81% | -3.32% | -5.59% | 1.76% | |
| Appropriate Market Index (AMI)2 | -0.56% | -3.27% | -4.71% | 2.28% |
AMI (appropriate market index) is a theoretical portfolio with similar underlying assets as the fund. This allows investors to see a comparison of how the value of those assets have changed in the market relative to the fund.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | -0.81% | -3.31% | -5.57% | 1.79% | |
| Appropriate Market Index (AMI)2 | -0.56% | -3.27% | -4.71% | 2.28% |
AMI (appropriate market index) is a theoretical portfolio with similar underlying assets as the fund. This allows investors to see a comparison of how the value of those assets have changed in the market relative to the fund.
| Security Name | Percentage |
|---|---|
| JPM Multi Manager Alternatives X Acc NZD Hedged | 5.00% |
| NZ Govt Inflation Index Bond 20/09/25 | 2.64% |
| Japan Government Of 110722 0.00 Gb | 1.61% |
| Japan Government 150822 0.00 Gb | 1.53% |
| Westpac NZ 1.439% 02/24/26 | 1.38% |
| Kommunalbanken AS 1.25% 02/07/2030 | 1.26% |
| Westpac New Zealand Ltd 160227 3.696 Cb | 1.16% |
| Housing NZ 3.42% 18/10/2028 | 1.14% |
| Kiwibank Ltd 2.155% 20/09/2024 | 1.07% |
| ASB Bank Ltd 040526 1.646 Cb | 0.99% |
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Commentary
As of 31 May 2022
Market Highlights
The underlying equity strategies in the fund (domestic and global) outperformed the broader equity markets, but in aggregate were still unable to produce a positive return. The positive return from domestic bonds and cash was largely offset by the negative returns from global bonds (whose 1-year numbers are now similar to domestic bonds which had started their decline a little earlier). Foreign currency exposure in the portfolios (achieved through having a portion of the global shares holdings unhedged) has added value as the NZ dollar weakens, through the higher value of the offshore currencies. This continues to be an important part of the fund’s overall diversification strategy albeit it’s not designed to provide additional returns over time it will help smooth returns. Within the alternative sector, the ‘multi-strategy’ portfolio has benefitted the portfolio by softening the falls from both equity and bond markets. On the positive side, with interest rates having risen so much over the past few months, forward looking return expectations are now higher, and it’s healthier to have some yield premium back into the bond portfolios and this will be return enhancing for the fund over the longer term.