Summer Australian Equities

Summer Australian Equities fund performance summary as at 30 September 2020. 

Fund at a glance

Unit price (as at 30 September 2020): $1.2125

Date the fund started: 19 September 2016

For information on fees, see our Fees page.

For more information on the Summer Australian Equities fund, read the latest quarterly fund update and the product disclosure statement

Fund objective and strategy

See the Australian Equities page for the Summary of investment objective and strategy.

Fund returns

 Annualised total since inception1 Month3 Months1 Year3 Years^
Fund 4.08% -4.10% -0.37% -9.09% 1.72%

Fund returns are calculated net of fund charges, trading expenses and accrued tax for a New Zealand resident individual paying tax at the highest Prescribed Investor Rate (28%). 
^ Annualised

Top 10 investments

  Asset name % of fund net assets
1 CSL Limited 9.95%
2 BHP Group Limited 6.75%
3 ANZ transactional bank account 5.33%
4 Commonwealth Bank of Australia Limited 5.03%
5 Westpac Banking Corporation Ltd 4.40%
6 National Australia Bank Limited 3.61%
7 Wesfarmers Limited 3.31%
8 Telstra Corp 3.27%
9 Woolworths Ltd 3.11%
10 Downer EDI Limited 2.92%

The top 10 investments make up 47.68% of the fund.

Manager's Commentary

Market Commentary

Share markets globally have just finished a second successive quarter of strong gains, despite most regions taking a breather in September. The performance of financial asset prices over the past six months would have surprised everyone when considering the dire global outlook we faced back in March. This is testament to the unprecedented (yes that word again) support given to financial markets and economies in general by central banks and governments around the world. Central banks have committed to continuing their extraordinary levels of liquidity support for the foreseeable future, while many governments are trying to be more nuanced by balancing the type and level of ongoing fiscal support with political realities such as budget constraints and for some, election cycles.

Australian equities declined in September, ending a five-month rally, as investors face renewed fears over a more extreme second wave of coronavirus cases globally as well as global growth concerns. The S&P/ASX 200 (in local currency terms) fell 4.1% over the course of September, the worst month since March, dragging what had been a largely flat quarter to date into the red.  The reference index for this fund assumes a 50% currency hedging to New Zealand dollars and was up just 0.3% for the quarter under review.

Portfolio Performance and Positioning

Summer Australian Equities decreased by 4.10% in the month of September. Over the September quarter, the fund lost 0.37%.

Key contributors to performance during the quarter under review included overweight exposures in Senex Energy (SXY), oOh!media (OML), Northern Star Resources (NST), Service Stream (SSM), Webjet (WEB), Downer EDI (DOW), and Altium (ALU).

Key detractors to performance included overweight exposures in The a2 Milk Company (ATM), Viva Energy (VEA), IAG Group (IAG), and McMillan Shakespeare (MMS).  Not owning Fortescue Metals (FMG), Afterpay (APT), and James Hardie (JHX) also cost performance during the quarter under review.       

During the quarter, we introduced exposure to new namesTassal Group (TGR), Sydney Airport (SYD), APA Group (APA), Charter Hall (CHC), Challenger (CGF) and IOOF (IFL) and SSM.  We also added to names such as OML, DOW, MMS, and Santos (STO) and Telstra (TLS).  We funded these increases by taking profits in some of the Information Technology names and NST, which have materially outperformed, along with deploying higher than average cash balances at the start of the quarter.


While there are many uncertainties surrounding the virus and how long it will continue to disrupt global activity, one thing we do know is that interest rates are going to remain at current or lower levels for some years to come.

One sector to benefit from the historically low interest rates is housing. This is being reflected in strong house sales data and demand for new builds. As home prices strengthen, and the economic recovery broadens out, the positive wealth effect on homeowners is being reflected in stronger than expected consumer sentiment and retail sales. On-line sales are surging which is boosting ecommerce businesses and package delivery companies. As lockdowns ease, shoppers are heading back to high streets and malls to spend pent up savings that are earning nothing in the bank.

Overall, in Australasia, we are of the view performance in the equity markets will accelerate towards ‘recovery/vaccine’ stocks.  Vaccine news-flow is set to ramp up over the remainder of the year, and whilst the efficacy of these vaccines will ebb and flow, pharmaceutical companies and governments are incentivised to put a favourable spin on such news-flow.  At a really broad level, this thesis suggests we should overweight our exposure to underperforming industrial, oil, resources (in particular iron ore), retail REITs and tourism stocks (airports, airlines, gaming), and underweight our exposure to growth stocks (in particular the “WAAAX” stocks being Wisetech, Afterpay, Altium, Appen, and Xero) and defensive names.  A move to higher long-term bond yields (steepening yield curve) supports being overweight in financials, and underweight in gentailers, infrastructure, telecoms and REITs.  We are cautiously positioning for such a scenario, but are very much aware there may be hiccups along the way, not least COVID and elections (both locally and USA) related, and therefore continue to carry slightly elevated levels of cash.  

We actively manage the fund’s foreign currency exposures. As at 30 September 2020, the fund’s foreign currency exposures represented 94.67% of the value of the fund. After allowing for foreign currency hedges in place, approximately 61.30% of the value of the fund was unhedged and exposed to foreign currency risk.



This is not a recommendation to buy or sell any financial product and does not take your personal circumstances into account. All opinions reflect our judgement on the date of communication and may change without notice. Past performance is not a reliable guide to future performance. We recommend you take financial advice before making investment decisions. We have prepared this web page in good faith based on information obtained from other sources, but we do not guarantee the accuracy of that information. We do not make any representation or warranty (express or implied) that this web page is accurate, complete, or current and to the maximum extent permitted by law disclaim any liability for loss which may be incurred by any person relying on this web page.