Summer New Zealand Equities
Summary of investment objective and strategy
To achieve long-term returns (before fees, taxes and other expenses) greater than the S&P/NZX50 Gross with Imputation Index.
These investments typically have moderate to high levels of movement up and down in value.
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.
Strategic investment mix
| Category | % |
|---|---|
| Cash and cash equivalents | 5.00% |
| New Zealand fixed interest | 0.00% |
| International fixed interest | 0.00% |
| Total income assets | 5% |
| Australasian equities | 85.00% |
| Listed property | 10.00% |
| International equities | 0.00% |
| Total growth assets | 95% |
| Total portfolio | 100% |
Minimum suggested investment timeframe
Fund at a glance
Unit price (as at 31 August 2026): $1.9561
Date the fund started: 19 September 2016
Fund returns
| PIR | 1 Month | 3 Month | 1 Year | 3 Years^ | Total since inception^ |
|---|---|---|---|---|---|
| 28% | 2.47% | 6.28% | 9.69% | 5.88% | 7.00% |
^ 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 | Fisher & Paykel Healthcare Corporation Limited | 16.46% |
| 2 | Infratil Limited | 9.02% |
| 3 | Auckland International Airport Limited | 8.20% |
| 4 | Mainfreight Limited | 4.62% |
| 5 | Contact Energy Limited | 4.47% |
| 6 | Ebos Group Limited | 4.37% |
| 7 | Spark New Zealand Limited | 4.24% |
| 8 | Meridian Energy Limited | 3.81% |
| 9 | The a2 Milk Company Limited | 2.89% |
| 10 | Mercury NZ Limited | 2.68% |
| Top 10 investments total | 60.76% | |
Portfolio Holdings
Summer New Zealand Equities Portfolio Holdings
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Manager's Commentary
How did your portfolio perform?
The Summer New Zealand Equities Fund (the Fund) delivered a return after fees and before tax of 2.53% during August, comfortably outperforming the Fund’s benchmark* return of 1.67%. For the 12 months to the end of August, the Fund delivered a return after fees and before tax of 10.76%, significantly outperforming the Fund’s benchmark return of 8.40%.
The main positive contributors to performance in August were our overweight in Sky Television (SKT) and underweight in Chorus. SKT delivered a positive dividend surprise and strong forward guidance for dividends over the next three years. Chorus delivered an in-line result but earnings, dividends and capex guidance slightly disappointed market expectations.
Stocks that were a relative drag on performance were our underweight in F&P healthcare (FPH), and overweight in Tourism Holdings (THL). FPH provided an update around their Annual Shareholders Meeting which confirmed strong ongoing demand for their latest product releases. Despite having two parties doing due diligence for a potential takeover at materially higher prices, THL drifted lower as its result indicated a longer time frame to achieve full profit margin restoration.
What happened in the markets you invest in?
Reporting season dominated news flow and drove market movements during August. In aggregate, companies largely met market expectations and forward guidance, where provided, ended with a slightly positive skew. Whilst outlook statements reflected continued caution, perhaps the best indicator of improved confidence was a lift in the dividend payout ratio. Companies should not lift payments to shareholders if they don't have confidence that dividends will be sustainable into the future and backed by earnings growth.
The Australian economy is clearly slowing (outside of mining) and this will create a headwind for the large number of NZ stocks that have operations there. Retailers and stocks exposed to Australia’s residential housing market are perhaps most exposed. However, stock-specific impacts can vary, and both Hallenstein Glasson's and Freightways reported strong results from their Australian divisions.
What are we thinking about the future?
There is a gentle positive tone to the general backdrop in our view, notwithstanding continued caution in company outlook statements. Resolution in the Middle East, a centre party dominated NZ election outcome and some evidence that inflation is beginning to fall would likely move that gentle positive tone to solidly positive.
Many companies are still reporting profit margins well below historic norms – the opposite to what we are seeing in stronger economies such as the US. If anything, defensive stocks slightly disappointed in their profit updates this time around, yet they continue to trade at full valuations even with bond yields at cyclical highs. As such, we continue to see better valuation support in many smaller and economically exposed stocks, along with those where management are taking decisive action to address current areas of operating weakness. Heartland Bank and Michael Hill fit into that latter camp.
*The benchmark for the fund is the S&P/NZX50 Gross with Imputation Index.