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The fund invests in a broad selection of NZ dollar denominated bonds issued by Governments, Government entities, banks and companies, providing investors with a regular income. The fund may experience modest ups and downs in value.
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.
Ian is a Fixed Income Manager here at Nikko AM. In this video, Ian talks about the NZ Bond Fund and describes what this fund aims to achieve in terms of returns. Ian also explains what sets this fund apart from the rest and why you should consider the NZ Bond Fund for your next investment.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | 0.67% | 1.15% | 7.57% | 2.57% | 0.67% |
| Appropriate Market Index (AMI)2 | 0.59% | 1.16% | 7.17% | 2.12% | 0.16% |
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 |
|---|---|
| NZ Government 150534 4.25 Gb | 7.22% |
| NZ Government 2.75% 15/04/2037 | 7.16% |
| NZ Government 150541 1.75 GB | 6.29% |
| New Zealand Government 150535 4.50 Gb | 4.90% |
| Nzlgfa 4.5% 15/05/2030 | 3.71% |
| New Zealand Government 150531 1.50 Gb | 3.39% |
| Rabo 5.31% 05/04/2029 | 2.82% |
| NZ Government Bond 2% 15/05/2032 | 2.69% |
| Housing NZ 1.534% 10/09/2035 | 2.52% |
| Dunedin City Treasury 101033 4.966 Lb | 2.14% |
Commentary
As of 28 February 2025
Market Overview
Fund Commentary
The fund returned 0.72% for February and outperformed its benchmark the Bloomberg Composite which returned 0.59%.
The move lower in interest rates was a key driver of absolute and relative returns. The outperformance of government bonds (which make up close to 70% of the benchmark) was relatively neutral as the government bonds that the fund holds are of long duration (we hold a lower percentage of government bonds). We continue to maintain a longer duration with a steep yield curve and expect carry and roll will support returns over the medium term.