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The fund invests in a selection of NZ dollar denominated bonds issued by banks and companies, providing investors with a regular income. The fund may experience modest ups and downs in value.
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 | -0.31% | 0.95% | 7.58% | 4.99% | 1.53% |
| Appropriate Market Index (AMI)2 | -0.18% | 1.11% | 7.90% | 5.38% | 2.03% |
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 |
|---|---|
| Housing NZ 1.534% 10/09/2035 | 3.75% |
| NZ Local Govt Funding Agency 150437 2.00 GB | 3.27% |
| Insurance Australia Group Ltd 150628 5.32 Cb | 3.08% |
| NZLGFA 3% 15/05/2035 | 2.89% |
| Christchurch City Hldgs 210532 4.82 Gb | 2.58% |
| Housing NZ 3.42% 18/10/2028 | 2.54% |
| Dunedin City Treasury 101033 4.966 Lb | 2.44% |
| Auckland Council 170639 5.745 Cb | 2.43% |
| Chorus Ltd 4.35% 06/12/2028 | 2.18% |
| Air New Zealand Ltd Sydney Branch 250529 6.50 Cb | 2.11% |
Commentary
As of 31 May 2025
Market Overview
Fund Commentary
The fund had a negative return of 0.25% for the month which was marginally behind its the benchmark the Bloomberg Credit Index which returned -0.18%.
The move higher in interest rates was the main driver of absolute and relative returns over the month, with the longer duration positioning proving unhelpful. Positives were credit margins have recovered (post widening in April) and the fund maintains a yield advantage over benchmark. We continue to maintain a longer duration with a steep yield curve and expect carry-and-roll will support returns over the medium term.