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This fund provides investors with concentrated exposure to New Zealand and Australian share markets from an actively managed investment portfolio of high conviction companies. The manager selects companies for investment where they have a strong view on the medium-term outlook for positive returns.
In times of high uncertainty or low conviction the fund can hold more cash than typical Australasian shares funds.
Risk Indicator (volatility)
Target Asset Allocation
This number indicates the relative 'risk' level of this fund based on the types of assets it is invested in, ranging from level 1 (least risky) to 7 (most risky).
| Risk category | Description of volatility |
| 1 | Very low |
| 2 | Low |
| 3 | Medium |
| 4 | Medium to High |
| 5 | High |
| 6 | Very high |
| 7 | Extremely high |
The risk indicators are calculated using returns of the funds, the returns of the fund’s market index or a combination of both, for the previous five years. Index returns or a mix are used if the fund has existed for less than five years. All Managers are required to use the same methodology so you can compare the risk of different funds if you are researching more than one manager.
Michael is the Head of Equities at Nikko AM. In this video, he explains what an average day in his job looks like, what he's trying to achieve with this portfolio, and what he sees as a good investment. Michael also talks us through the investment process and outlines the main reasons why you should consider the Concentrated Fund for your next investment.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | 1.42% | 5.89% | 18.38% | 2.37% | 5.33% |
| Appropriate Market Index (AMI)2 | 3.40% | 5.24% | 16.21% | 1.74% | 3.68% |
AMI (appropriate market index) is a theoretical portfolio with similar underlying assets as the fund. This allows investors to see a comparison of how the value of those assets have changed in the market relative to the fund.
| Security Name | Percentage |
|---|---|
| Infratil Limited | 11.21% |
| NEXTDEC Ltd | 10.18% |
| Contact Energy Limited | 9.76% |
| Summerset Group Holdings Ltd | 7.96% |
| Worley Limited | 6.89% |
| Ingenia Communities Group | 6.02% |
| Aristocrat Leisure Ltd | 5.62% |
| Waypoint REIT Fully Paid Ord Units Stapled Securities | 5.44% |
| Spark New Zealand Ltd | 5.29% |
| Ryman Healthcare Ltd | 4.78% |
Commentary
As of 30 November 2024
Market Overview
Fund Commentary
The largest positive contributors to the fund’s return were positions in Aristocrat Leisure (ALL), Fisher & Paykel Healthcare (FPH) and Infratil (IFT). ALL delivered a very strong result, well ahead of market expectations which saw the stock up 17.0% (in AUD). FPH rose 18.5% over the quarter after delivering a solid result and also providing strong earnings growth guidance for the year ahead. IFT performed well post its $1.15b capital raising to fund its data centre development pipeline and ended the quarter up 4.2%.
The largest negative contributors to the fund’s return were from positions in Spark (SPK), Summerset (SUM) and Arcadium Lithium (LTM). SUM fell 16.7%, mainly impacted by a seller of more than 35 million RYM shares weighing on the retirement sector stocks. SPK downgraded earnings guidance by ~4% but did maintain its dividend guidance which puts the stock on an attractive yield. The earnings downgrade led to SPK falling 12.7% over the quarter. The LTM share price has been heavily impacted by weak lithium prices and as a result LTM fell 27.3% (in AUD) over the quarter.
Portfolio changes over the quarter included adding to our position in NextDC (NXT) and IFT through their capital raisings and adding a new position in EBOS (EBO) as it was sold down due to its removal from a MSCI index. New positions were also taken in Worley (WOR) and Channel Infrastructure (CHI). The fund’s position in FPH was reduced while the Ramsay Healthcare was divested from the fund.
(Bold denotes stocks held in the portfolio).