Single Sector Fund
On this page:
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.
Matt is a Fixed Income Manager at Nikko AM. In this video, he explains what an average day in his job looks like, what he's trying to achieve with this portfolio, and what he sees as a good investment. Matt also talks us through the investment process and outlines the main reasons why you should consider the Cash Fund for your next investment.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | 0.46% | 1.46% | 6.03% | 3.32% | 2.62% |
| Appropriate Market Index (AMI)2 | 0.48% | 1.41% | 5.72% | 3.17% | 2.25% |
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 | 0.45% | 1.45% | 5.98% | 3.21% | 2.55% |
| Appropriate Market Index (AMI)2 | 0.48% | 1.41% | 5.72% | 3.17% | 2.25% |
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 |
|---|---|
| Rabobank Nederla 160326 Frn | 5.71% |
| Westpac New Zealand 060726 Frn | 5.49% |
| Mufg Bank Ltd Auckland Branch 241126 Frn | 5.01% |
| Industrial And Commercial Bank Of China Nzd 260525 Frn | 4.05% |
| New Zealand Tax Trading Co 110424 Rcd | 3.79% |
| Bank Of New Zealand 231126 Frn | 3.27% |
| ASB Bank Ltd 200924 Rcd | 2.83% |
| Rabobank Nederla 160625 Frn | 2.70% |
| China Construction Bank Nz Ltd 090226 Frn | 2.70% |
| Westpac NZ 2.22% 29/07/24 | 2.68% |
Commentary
As of 31 March 2024
Market Highlights
More latterly in March 90-day bills have been rangebound trading in a 2-basis point range waiting on the Reserve Bank’s April meeting for future direction. Conversely, interest rates for longer bills have continued to decline in sympathy with ongoing weak economic data; over March 6-month bills declined 7bps to end 5.57% whilst 1-year swap declined 19bps to end 5.30%. With the bills swap curve now increasingly inverted we let duration roll down over March, preferring to wait to see if the Reserve Bank’s inflation taming resolve is tempered in their April statement. Nevertheless, maintaining a structurally long duration position is appropriate in the current environment, however market pricing (of cuts) and the Reserve Bank’s track currently meaningfully differ. We expect to carefully add duration pending pricing and clarity on the Reserve Bank’s stance.