Single Sector Fund
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This fund invests in a selection of NZ dollar denominated cash investments and short-term bonds that aim to protect value while at the same time providing a higher return than bank deposits.
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 | 0.05% | 0.20% | 0.66% | 1.27% | 1.77% |
| Appropriate Market Index (AMI)2 | 0.09% | 0.24% | 0.58% | 0.79% | 1.26% |
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 | 0.04% | 0.17% | 0.52% | 1.22% | |
| Appropriate Market Index (AMI)2 | 0.09% | 0.24% | 0.58% | 0.79% |
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 |
|---|---|
| HSBC Bank New Zealand 111124 Frn | 5.92% |
| Rabobk Nfix3fra + 38 28/06/2024 | 5.42% |
| Bank Of New Zealand 180324 Frn | 4.76% |
| New Zealand Inland Revenue 060522 Rcd | 4.14% |
| ICBC NZ 27/06/2022 FRN | 3.81% |
| Bank Of China | 3.09% |
| Inland Revenue Deposit 210622 Rcd | 2.89% |
| Mufg Bank Ltd Auckland Branch 051124 Frn | 2.84% |
| New Zealand Tax Trading Co 220622 Rcd | 2.73% |
| Bank Of New Zealand Cash at Call | 2.38% |
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Commentary
As of 31 March 2022
Market Highlights
The strategy returned 0.26% over the quarter outperforming its 90-day bank bill index which returned 0.24%. The fund has been implementing a barbel investment strategy, with short positions concentrated around the upcoming Reserve Bank meeting dates complemented with some longer positions to take advantage of the higher rates offered for tenor. In general, this strategy has performed with the Reserve Bank thus far implementing 0.25% OCR increases rather than more aggressive moves. March has seen higher pricing of near-term OCR increases along with a higher terminal OCR level. This has resulted in somewhat weaker performance of our strategy in March relative to January and February. We nonetheless remain comfortable with this strategy and see the potential for outperformance over time. The level of slope available in the term curve out to 1-year is meaningful as is slope in some sectors of the credit curve. In addition, there are signs of growing headwinds to growth which may see a slower than priced OCR path eventuate.