Managed Funds: Single Sector Fund

Nikko AM Core Equity Fund

About the fund

This fund invests in a broad selection of NZ listed companies with potential for growth of income and capital, and may also invest in some Australian shares if the portfolio managers see opportunities, as part of an actively managed portfolio.



Morningstar Bronze Rating Report 


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Risk Indicator (volatility)

5 High

Target Asset Allocation

Equities 100.00%


As of 31 May 2022

Market Highlights

  • Global equity markets were mixed in May with inflation, increasing interest rates, earnings results and the war in Ukraine having an impact.
  • The United States S&P 500 index was flat, the Japanese Nikkei 225 index rose 1.6%, the UK FTSE 100 index gained 0.8%, the Australian ASX 200 index declined 2.6% and the MSCI World index ended the month up 0.3%.
  • The S&P/NZX 50 index ended the month down 4.8%.

The strategy ended the month down 4.6% and 0.2% ahead of the index return. The largest positive contributors to relative return were overweight positions Pushpay Holdings (PPH), Channel Infrastructure (CHI) and Aristocrat Leisure (ALL) and an underweight (nil) position in Air New Zealand (AIR). PPH rallied ~10% during the month after two investors announced they had secured a combined stake of 20.3% and they were developing a proposal to acquire PPH’s shares via a scheme of arrangement. At its annual shareholder meeting CHI confirmed they are tracking in line with expectations on the refinery terminal conversion costs and ended the month up 3.7%. ALL announced a strong first half result, beating market expectations and launching a $500m share buyback, all of which supported the share in an otherwise negative market. Z Energy delisted from the market last month, but the payment was made during May which resulted in outperformance relative to the market which fell. AIR continues to digest its recent capital raising and fell 27.7%.


The largest negative contributors to relative return were overweight positions in Fletcher Building (FBU) and Summerset (SUM) and an underweight position in Ryman Healthcare (RYM). Despite providing a positive market update early in May, FBU fell 12.4% on negative sentiment around the housing market. SUM, also impacted by negative housing market sentiment fell 9.7%. Despite being removed from the MSCI index, RYM rose 8.6% as the market had pre-positioned itself for the event.


Key portfolio changes during the month included adding to Scales (SCL), Mainfreight (MFT), Auckland International Airport (AIA), Ramsay Healthcare (RHC), Aristocrat Leisure (ALL)d and SkyCity Entertainment (SKC). Reductions were made in Contact Energy (CEN), Meridian Energy (MEL), Ryman Healthcare (RYM) and SUM. Westpac (WBC) and ZEL were removed from the fund.

 (Bold denotes stocks held in the portfolio.)



Nikko AM Investment Scheme
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at 31 May 2022
One month Three months One year Three years (p.a) Five years (p.a)
Fund performance1 -4.63% -5.06% -5.34% 4.32% 9.36%
Appropriate Market Index (AMI)2 -4.81% -5.31% -7.55% 4.50% 9.73%
  1. Returns are before tax and after the deduction of fees and expenses and including tax credits (if any).
  2. AMI: S&P/NZX 50 Index Gross with Imputation Credits.

5 year cumulative performance $10,000 invested

Top 10 Holdings

Security Name Percentage
Fisher & Paykel Healthcare 10.23%
Spark New Zealand Ltd 8.86%
Infratil Limited 7.32%
Mainfreight Limited 7.12%
Auckland International Airport Ltd 6.83%
Contact Energy Limited 6.53%
EBOS Group Limited 6.24%
Fletcher Building Ltd 5.36%
Meridian Energy Ltd NPV 3.94%
Summerset Group Holdings Ltd 3.81%

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