Summer Global Equities
Summary of investment objective and strategy
To achieve long-term returns (before fees, taxes and other expenses) greater than MSCI ACWI Net Total Return Index, 50% hedged to the New Zealand dollar.
These investments typically have high levels of movement up and down in value.
Minimum suggested investment timeframe
At least five years
Strategic investment mix
| Category | % |
|---|---|
| Cash and cash equivalents | 10.00% |
| New Zealand fixed interest | 0.00% |
| International fixed interest | 0.00% |
| Total income assets | 10% |
| Australasian equities | 0.00% |
| Listed property | 0.00% |
| International equities | 90.00% |
| Total growth assets | 90% |
| Total portfolio | 100% |
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 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.
Fund at a glance
Unit price (as at 31 January 2026): $2.4861
Date the fund started: 18 October 2019
Fund returns
| PIR | Total since inception^ | 1 Month | 3 Month | 1 Year | 3 Years^ |
|---|---|---|---|---|---|
| 28% | 9.69% | 0.19% | 2.03% | 10.68% | 16.69% |
^ 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 | Vanguard ESG US Stock ETF | 6.31% |
| 2 | Vanguard ESG International Stock ETF | 3.61% |
| 3 | Microsoft Corporation | 3.44% |
| 4 | Alphabet Inc. Class A | 2.04% |
| 5 | Mastercard Inc. | 1.59% |
| 6 | VERIZON COMMUNICATIONS INC | 1.44% |
| 7 | General Motors Co. | 1.40% |
| 8 | Amazon.com Inc. | 1.33% |
| 9 | Dexcom Inc. | 1.28% |
| 10 | UBER TECHNOLOGIES INC | 1.28% |
| Top 10 investments total | 23.72% | |
Manager's Commentary
How did your portfolio perform?
The Summer Global Equities Fund (the fund) delivered a return after fees and before tax of 0.52% during January. For the 12 months to the end of January, the fund delivered a return after fees and before tax of 11.16%.
Our minimum volatility manager outperformed the index over the month, while the Growth thematic manager lagged. The largest positive contributors to the fund’s relative performance were underweights in Apple and Palantir, which underperformed the index, and an overweight position in ASML. ASML gained ~30%, driven by revenues beating expectations and record-breaking forward orders for its silicon photolithography systems (the process that ‘etches’ circuits onto silicon wafers for the semiconductor industry). Salesforce, Nestlé and Mastercard were key detractors, each experiencing single-digit share price declines.
In January the fund switched to a core, global factor portfolio to enhance our multi-manager approach. The global factor portfolio builds stock positions based on strong cash-flow generation and robust earnings fundamentals. Combined with market-reaction factors, these positions are optimised to create a diversified portfolio with a clear focus on risk control. More detail about the new Octagon Global Factors Portfolio can be found on the GEF page: Global Equities Fund - Octagon Asset Management.
We actively manage the fund’s foreign currency exposures. During the month, the New Zealand dollar rose strongly against the US dollar, up 5.18% and also up against the Euro and the Japanese Yen. Overall our active hedging added to portfolio performance.
What happened in the markets you invest in?
Global equities started the year on a strong but volatile footing. The MSCI All Country World Index (ACWI) returned ~3% in US dollar terms, supported by improved growth expectations amid ongoing geopolitical tensions. Macroeconomic data mostly surprised to the upside, with stronger economic activity data and moderating inflation pressures. Cyclical stocks outperformed defensives. Emerging markets and developed Asian markets (including a strong Japanese equities market) led gains.
Global bonds sold off on the back of the stronger economic data. US short-terms rates moved higher as expectations for Federal Reserve rate cuts were pushed out. As uncertainty around the US monetary and fiscal outlook persisted, the US dollar weakened against G10 currencies, including the New Zealand dollar. US equity market performance also broadened beyond the technology sector. Small-cap stocks rallied ~5%, while the ‘Mag-7’ stocks collectively rose just ~1% over the month.
The strong performance in equities outside the US has been driven primarily by earnings rather than valuation expansion. Emerging markets, Japan’s TOPIX and materials stocks have seen upgrades to 2026 EPS revisions.
What are we thinking about the future?
The US equity market continues to look expensive and imbalanced to us. While the recent price run-up has been significant, momentum factors alone have accounted for around 40% of total market returns over the past two years. This has been driven largely by data-centre investment and AI-related enthusiasm, against a backdrop of stimulative financial conditions. Many of these momentum stocks are companies with rising earnings estimates but little or no free cash flow, rapidly increasing capital spending and generally weak earnings quality.
Our bottom-up managers focus on selecting companies with high-quality earnings trends, disciplined capital allocation and attractive valuations. They continue to find opportunities outside the US, particularly in developed Asia, Japan, Europe and the UK.
In the US, the fourth-quarter earnings season is now around halfway through, with earnings beating estimates by ~6%, marginally above the long-term average surprise of 4.9%. Forward year-on-year EPS growth is 14.9%, with growth expectations in the technology sector continuing to outpace that of the broader index.