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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 | -3.43% | -3.57% | 7.17% | 2.95% | |
| Appropriate Market Index (AMI)2 | -2.98% | -3.45% | 8.14% | 2.56% |
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 | -3.44% | -3.60% | 7.01% | 2.85% | 3.45% |
| Appropriate Market Index (AMI)2 | -2.98% | -3.45% | 8.14% | 2.56% | 3.04% |
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 | 14.83% |
| Infratil Limited | 10.05% |
| Auckland International Airport Ltd | 9.75% |
| Contact Energy Limited | 7.24% |
| Meridian Energy Ltd NPV | 6.60% |
| Mainfreight Limited | 5.36% |
| The A2 Milk Company Limited | 4.93% |
| Spark New Zealand Ltd | 4.31% |
| EBOS Group Limited | 4.23% |
| Ryman Healthcare Ltd | 3.96% |
Commentary
As of 28 February 2025
Market Overview
Fund Commentary
The largest positive contributors to the fund’s relative return were overweight positions Worley (WOR), A2 Milk (ATM), and underweight Gentrack (GTK). WOR delivered a positive 5.3% return. The company produced a solid first half FY25 earnings result and of critical importance for investors, reconfirmed the full year FY25 earnings guidance. In addition, a $500 million share buyback was announced. ATM delivered a positive 37.3% return. The company's FY24 result (August 2024) was plagued by supply-chain related concerns that ATM explained as transient. The market responded with suspicion. Consequently, the first half FY25 result was well received, given its strength and more so, in proving that the issue was indeed short-lived and well-contained. GTK delivered a negative 10.6% return. The stock was the best performer on the NZX 50 index last year yet has pulled back from its lofty highs as some investors take profit in the face of what has been described by management as a transition year for the company.
The largest negative contributors to relative return were from overweight positions in Ryman Healthcare (RYM) and Spark (SPK) and an underweight position in Fletcher Building (FBU). RYM delivered a negative 23.9% return. The company surprised the market with a large $1 billion capital raising to reset its balance sheet. Debt will be reduced and gearing falls from 37.3% to 23.1%. RYM also provided a weak trading update, citing challenging market conditions, heightened competition, and impacts from changes to the pricing model and organisational restructure. The capital raise was at a large 29% discount to last traded price. SPK delivered a negative 22.0% return. The company produced a disappointing first half FY25 result. It represented the fourth consecutive downgrade over a circa one year period. The drivers included softer revenue due to the economic slowdown and increased competition. FBU delivered a positive 18.5% return. The company provided a first half FY25 result that was roughly in line with market expectations. This buoyed investors given the absence of a FY25 full-year downgrade which some had expected due to ongoing tough economic conditions.
Key portfolio changes during the month included exiting Arcadium Lithium (LTM) ahead of the takeover completion in March. Adding to positions in ResMed (RMD), Kiwi Property (KPG), Mainfreight (MFT). Our position in RYM was added to as part of the capital raising. Reducing positions in Ingenia Communities (INA), Centuria Industrial REIT (CIP), and Waypoint (WPR). (Bold denotes stocks held in the portfolio).