Summer Balanced Selection
Summary of investment objective and strategy
We aim to achieve long-term returns (before fees, taxes and other expenses) greater than a composite benchmark relating to the target investment mix.*
Investors can expect:
- moderate to high levels of movement up and down in value
- longer-term returns that are higher than those of the Summer Conservative Selection (but with more risk), and lower than those of the Summer Growth Selection (but with less risk).
Risk indicator
The risk indicator is rated from 1 (low) to 7 (high). The rating reflects how much the value of the fund’s assets goes up and down (volatility). A higher risk generally means higher potential returns over time, but more ups and downs along the way. The risk indicator is based on the returns data for the five years to 30 June 2026.
* The composite benchmark for each multi-asset class fund is made up of the single asset class benchmarks weighted by the target asset allocation for the asset class.
Strategic investment mix
| Category | % |
|---|---|
| Cash and cash equivalents | 7.00% |
| New Zealand fixed interest | 19.00% |
| International fixed interest | 19.00% |
| Total income assets | 45% |
| Australasian equities | 17.00% |
| Listed property | 3.00% |
| International equities | 35.00% |
| Total growth assets | 55% |
| Total portfolio | 100% |
Tactical asset allocation
| Category | % |
|---|---|
| Cash and cash equivalents | 4.50% |
| New Zealand fixed interest | 19.00% |
| International fixed interest | 16.50% |
| Total income assets | 40% |
| Australasian equities | 19.00% |
| Listed property | 6.00% |
| International equities | 35.00% |
| Total growth assets | 60% |
| Total portfolio | 100% |
Minimum suggested investment timeframe
Fund at a glance
Unit price (as at 31 July 2026): $1.7727
Date the fund started: 19 September 2016
Fund returns
| PIR | 1 Month | 3 Month | 1 Year | 3 Years^ | Total since inception^ |
|---|---|---|---|---|---|
| 28% | 0.71% | 3.20% | 7.17% | 6.91% | 5.50% |
^ Annualised
Fund returns are calculated net of fund charges, trading expenses and accrued tax for a New Zealand resident individual paying tax at the Prescribed Investor Rate identified above.
Top 10 investments
| # | Asset name | % of fund net assets |
|---|---|---|
| 1 | Hunter Global Fixed Interest Fund | 16.35% |
| 2 | Fisher & Paykel Healthcare Corporation Limited | 1.87% |
| 3 | New Zealand Government 1.5% 15/05/2031 | 1.43% |
| 4 | Infratil Limited | 1.25% |
| 5 | New Zealand Government 14/04/2033 3.5% | 1.23% |
| 6 | Precinct Properties New Zealand Limited | 1.22% |
| 7 | Microsoft Corp | 1.18% |
| 8 | Goodman NZ Ltd & Goodman Property Services Ltd | 1.17% |
| 9 | Apple Inc | 1.11% |
| 10 | BNZ Transactional Account NZD | 1.10% |
| Top 10 investments total | 27.91% | |
Portfolio Holdings
Summer Balanced Selection Portfolio Holdings
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Manager's Commentary
How did your portfolio perform?
The Summer Balanced Selection (the fund) delivered a return after fees and before tax of 0.76% for the month of July, significantly outperforming its benchmark* return by 1.81%. For the 12 months to the end of July, the fund delivered a return after fees and before tax of 7.63% underperforming its benchmark* return by -1.64%.
Higher interest rates weighed on fixed income and listed property markets in July. A stronger NZ dollar turned flat local currency global equities returns negative, but our significant currency hedge offset much of that impact. Australasian equities generated modest positive returns, while our investment managers outperformed their respective benchmarks for the month.
For details on the Balanced Selection's single asset class funds, see the relevant commentary.
We actively manage the fund’s foreign currency exposures and hedge the international fixed interest segment of the fund. The New Zealand dollar rose 3.32% against the US dollar and rose 1.89% against the Australian dollar.
What happened in the markets you invest in?
At the time of publishing, tensions in the Middle East remained with no lasting peace deal achieved. This contributed to higher global oil prices, adding to domestic inflationary pressures and ongoing cost-of-living challenges.
Inflation measures in NZ continue to point towards further rate hikes, but there is an offset from weaker domestic demand as unemployment hit a new cyclical high and wage growth remains subdued. Australian inflation data came in slightly lower than expected, with market commentators anticipating only one more rate hike in the near term.
Australian Federal budget changes impacting the housing and residential construction markets are yet to flow to actual activity, but lead indicators suggest a loss of confidence in the sector with risk to consumer spending if house prices flatten or decline.
The US earnings season was exceptionally strong, led by the Energy (Oil and Gas) and AI sectors. Profits feel much stronger than the underlying economic momentum, and profit margins continue to expand to levels not seen for decades.
What are we thinking about the future?
The Reserve Bank of Australia (RBA) is widely expected to leave interest rates unchanged at its mid-August meeting. In New Zealand, the Reserve Bank of New Zealand (RBNZ) is likely to remain focused on inflation trends, as pricing pressures continue to persist despite weak economic activity.
Listed property continues to appear attractively valued, with recent asset sales across the sector providing support for reported book values. However, elevated interest rates and limited growth in earnings and dividends remain headwinds for the sector.
August is a key reporting season for Australasian equity markets, although we do not expect earnings results to match the strength of the recent US reporting season. Local markets have less exposure to the Energy sector and AI-related capex that have been driving US earnings growth. Despite a geopolitically challenging June quarter, most companies appear to have navigated conditions reasonably well. Domestic demand remains subdued, however, and we expect outlook statements to be relatively cautious. Companies reporting during the first week of August have generally met expectations, providing an encouraging start to the season.
Global equities continue to deliver strong earnings growth. However, we believe much of this strength is already priced into current valuations. Given the risks posed by elevated debt levels, interest rates, and historically high profit margins, we maintain a neutral allocation to global equities.
The Investment Committee met in early August and made no changes.
*The Balanced Selection's composite benchmark is made up of the single asset class benchmarks weighted by the target asset allocation for the asset class. The single asset class benchmarks are the same as the benchmarks for the single asset class funds, and the benchmark for international fixed interest is the Bloomberg Global Aggregate Total Return Index, 100% hedged to the New Zealand Dollar.