Summer Global Fixed Interest fund performance update as at 30 June 2017.
Unit price (as at 30 June 2017): $1.0131
Date the fund started: 19 September 2016
For information on fees, see our Fees page.
Further information can be found in the product disclosure statement.
See the Global Fixed Interest page for the Summary of investment objective and strategy.
|Total since inception||1 Month||3 Months||6 Months|
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%).
|Asset name||% of fund net assets|
|1||ANZ Cash Deposit||24.62%|
|2||New Zealand Local Government Funding Agency Ltd 15/12/2017 6.00%||3.08%|
|3||Transpower New Zealand Ltd 30/06/2022 4.30%||2.84%|
|4||New Zealand Local Government Funding Agency Ltd 15/04/2020 3.00%||2.43%|
|5||Bank of New Zealand Subordinated Note 17/12/2025 5.314%||2.39%|
|6||ANZ Bank New Zealand Ltd 25/09/2020 4.03%||1.79%|
|7||Port of Tauranga Ltd Fixed Rate Note 29/10/2019 5.865%||1.76%|
|8||Sky City Entertainment Group Ltd 28/09/2022 4.65%||1.55%|
|9||Kiwi Capital Funding Ltd Capital Notes 15/07/2024 6.61%||1.54%|
|10||Precinct Properties New Zealand Ltd 17/12/2021 5.54%||1.52%|
The top 10 investments make up 43.52% of the fund.
Summer Global Fixed Interest delivered a return of 0.17% for the month.
While we anticipate the path of global interest rates and bond yields, in general, to be up, we are unsure as to timing.
In our view, politics will likely take a back seat and markets will instead be driven by the posturing and actions of central banks for the remainder of the year.
A controlled change in messaging came from a number of key central bank leaders over the month, with a consistency in rhetoric that indicated, to us at least, that the next evolution in monetary policy would be a reduction in the financial support that has been in place for many years now.
We also believe that any reduction in official financial largesse will be glacial in speed and very well signaled – a strategy of no surprises and ’a long time between drinks‘, and not one that is necessarily synchronised across nations.
Since the risk of an abrupt and destructive move higher in global interest rates and bond yields is in our view, unlikely, we will tactically continue to increase the fund’s exposure to international fixed interest. We will do this by selling down our investments in New Zealand cash and New Zealand fixed interest.
Currently around a third of the fund’s assets are invested in NZX Smartshares Global Bond Fund, where the investment manager is PIMCO, which we believe to one of the largest and more successful fixed interest managers available globally.
As, when and if, key international bond yields move towards cycle highs – think the US Government 10 year bond yield which currently sits at 2.35% and peaked earlier in the year at 2.60% - we will lift our exposure to the NZX Smartshares Global Bond Fund.
For more information on the Summer Global Fixed Interest fund, read the latest quarterly fund update.
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.