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The fund invests in a selection of bonds and other fixed income instruments issued by companies and governments from around the world, covering a wide range of regions and sectors. This fund provides exposure to fixed income products outside of NZ and currency exposure is hedged to remove the impact of changes in value of the NZ dollar.
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 | -0.34% | -0.17% | 5.56% | 2.01% | -0.15% |
| Appropriate Market Index (AMI)2 | -0.42% | 0.00% | 5.48% | 2.16% | -0.16% |
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 |
|---|---|
| United States Treasury 030725 0.00 Gb | 11.10% |
| France Republic Of Government 120625 0.00 Gb | 4.81% |
| Japan Government Of 120825 0.00 Gb | 3.28% |
| United States Treasury 210825 0.00 Gb | 2.94% |
| Japan Government Of 280725 0.00 Gb | 2.70% |
| French Discount T-Bill 090725 0.00 Gb | 2.59% |
| Japan 5 Year Issue 201229 1.10 Gb | 1.83% |
| Federal National Mortgage Association 150643 0.0 Tba | 1.66% |
| Government National Mortgage Association 150653 Tba | 1.18% |
| Fnma 30Yr Conventional 150635 6.00 Tba | 1.03% |
Commentary
As of 31 May 2025
Market Overview
Fund Commentary
The portfolio outperformed the benchmark in May 2025. This was driven by our Duration, Government Swaps and Cross Sector strategies.
Our Duration strategy outperformed, driven by our underweight position in 5-year Japanese rates. In Japan, the BoJ held rates steady in May, though signalled that further rate hikes may be required in response to rising inflation. Additionally, our tactical month end auction strategy contributed to returns.
Our Government Swaps strategy also contributed, driven by our European steepener positions.
Finally, our outperformance of our Cross Sector strategy was driven by our overweight bias to securitized assets such as CMBS and CLOs, as spread sectors outperformed off the back of positive trade headlines and a more optimistic growth picture relative to April.