Diversified Funds

Nikko AM Growth Fund

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About the fund

This fund aims for strong investment growth over the long term, with a greater likelihood of ups and downs along the way. The fund does this by investing mostly in shares, with a  moderate exposure to other assets such as bonds
and alternatives.

Risk Indicator (volatility)

1
2
3
4
5 High
6
7

Target Asset Allocation

Growth 80.00%
Income 20.00%

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Commentary

As of 30 September 2024

Market Overview
  • The US Federal Reserve kicked off their much-anticipated rate-cutting with a 0.5% cut. The European, Swedish and Swiss central banks also cut rates.
  • A new policy stimulus package from the People’s Bank of China included support for the local property market, and liquidity provisions to support lending and stabilize the property market and broader equity markets.
  • Interest rate sensitive sectors such as Real Estate (+16.1%) and Utilities (+15.9%) led the way over the third quarter.
  • The US, NZ and Australian equity markets returned around 6% for the quarter, while the UK (+0.9%) and Japan (-4.2%) underperformed the broader market.
Fund Commentary
The Growth fund registered a strong gain of 3.8% in the third quarter of 2024, slightly head of the return of the benchmark. The Global Share Fund was comfortably ahead of the benchmark for the quarter. The key contributors were from a broad range of sectors with Haleon (consumer staples), TransUnion (industrials) and Hoya Corp (healthcare) all performing well. This was driven by either their recent earnings report or improved forward guidance. The main detractors were also a mixed bunch, with Synopsys (IT), Elevance Health (healthcare) and SLB (energy) all detracting from relative performance. The local equity funds posted solid returns over the quarter on an absolute basis, but underperformed their relevant market indices. The Property Fund was the standout performer for the quarter in absolute (9.7%), partially on expectations of interest rates to come from the RBNZ. The Property Fund also did well in relative terms with strong performance from Waypoint REIT and Stride Property. Both the NZ and Global Bond funds added value over the quarter, with 1-year numbers also strongly ahead of benchmark. The New Zealand bond funds had been well positioned for a fall in interest rates, but also added value being underweight government bonds which underperformed swaps for the quarter. The Global Bond Fund added value through duration and curve positioning, as well as from the overweight to asset and mortgage-backed securities. Security selection in emerging market debt was a detractor over the quarter.

Performance

Nikko AM Investment Scheme
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Performance

at 30 September 2024
One month Three months One year Three years (p.a) Five years (p.a)
Fund performance1 1.35% 3.56% 19.21% 1.14% 5.67%
Appropriate Market Index (AMI)2 0.52% 3.70% 18.49% 4.66% 7.60%
  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 Global Select Equity X Acc Usd 15.74%
Infratil Limited 3.33%
Fisher & Paykel Healthcare 2.67%
Contact Energy Limited 2.54%
Microsoft Corp 1.98%
Summerset Group Holdings Ltd 1.79%
Spark New Zealand Ltd 1.67%
Auckland International Airport Ltd 1.62%
Amazon Com Inc 1.62%
NEXTDEC Ltd 1.54%
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