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This fund invests in a broad selection of NZ listed companies with potential for growth of income and capital, and may also invest in some Australian shares if the portfolio managers see opportunities, as part of an actively managed portfolio.
This fund provides a combination of specific exclusions and Environmental Social and Governance (ESG) integration, which considers the sustainability of companies.
The fund deliberately avoids investing in certain companies, industries, and sectors and aims to align social and personal values while still providing competitive returns.
Managed by a dedicated, institutional calibre SRI portfolio manager, the Nikko AM NZ SRI Equity Fund comprises 30-35 New Zealand and Australian companies.
Find our more about the Nikko AM SRI Equity Fund and our approach to Responsible Investing
Annual Fee 0.95%
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 a Portfolio Manager here at Nikko AM. In this video, Michael talks about the difference between ESG and SRI and outlines what the SRI Equity Fund is trying to achieve. Michael also outlines what the Fund's portfolio consists of and describes why you should consider this fund for your next investment.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | 0.80% | 5.54% | 12.38% | 2.06% | |
| Appropriate Market Index (AMI)2 | 0.40% | 5.62% | 12.24% | 1.03% |
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.
| One month | Three months | One year | Three years (p.a) | Five years (p.a) | |
|---|---|---|---|---|---|
| Fund performance1 | 0.78% | 5.47% | 12.23% | 1.50% | 3.93% |
| Appropriate Market Index (AMI)2 | 0.40% | 5.62% | 12.24% | 1.03% | 3.44% |
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 |
|---|---|
| Fisher & Paykel Healthcare | 15.93% |
| Auckland International Airport Ltd | 10.45% |
| Infratil Limited | 10.42% |
| Contact Energy Limited | 7.66% |
| Meridian Energy Ltd NPV | 6.06% |
| Spark New Zealand Ltd | 4.81% |
| Mainfreight Limited | 4.59% |
| Summerset Group Holdings Ltd | 4.06% |
| EBOS Group Limited | 3.77% |
| The A2 Milk Company Limited | 3.75% |
Commentary
As of 31 December 2024
The largest positive contributors to the fund’s relative return were overweight positions Arcadium Lithium (LTM) and Contact Energy (CEN), and an underweight position Mercury NZ (MCY). LTM delivered a positive 93.4% return. The company received a takeover bid from Rio Tinto at US$5.85 per share which the LTM board endorsed, and subsequently approved by shareholders. CEN delivered a positive 16.3% return. Following a relatively weak September quarter, CEN bounced back in the December quarter, aided by speculation that it may be added to the MSCI World Standard index in 2025. MCY delivered a negative 9.3% return. The share price decline occurred primarily in December, in the absence of any material negative company news flow. Speculation that it may be removed from the MSCI World Standard index in 2025 would likely be a contributing factor.
The largest negative contributors to relative return were from overweight positions NextDC (NXT), Ingenia Communities (INA) and Worley (WOR). Given the relatively weak Australian market over the quarter, Australian portfolio companies were generally a drag on fund performance. NXT delivered a negative 13.9% return. The market continues to digest its $550m capital raise from September. INA delivered a negative 9.0% return. Despite reaffirming guidance, INA was a casualty of the weak Australian market with the real estate sector particularly soft. WOR delivered a negative 7.6% return. The stock moved on no specific news.
Key portfolio changes during the quarter included establishing a new position in Scales (SCL), as part of the large shareholder sell-down. Adding to positions in Kiwi Property Group (KPG), Fletcher Building (FBU) completion of capital raise, Centuria Industrial REIT (CIP), Freightways (FRW) large shareholder sell-down, Worley (WOR) and Ryman (RYM). Reducing positions in Contact (CEN), Auckland Airport (AIA), EBOS (EBO), Resmed (RMD), and Mercury NZ (MCY). (Bold denotes stocks held in the portfolio).