Summer Global Fixed Interest

Summer Global Fixed Interest fund performance summary as at 31 May 2024. 

Fund at a glance

Unit price (as at 31 May 2024): $1.0905

Date the fund started: 19 September 2016

For information on fees, see our Fees page.

For more information on the Summer Global Fixed Interest fund read the latest quarterly fund update and the product disclosure statement

Fund objective and strategy

See the Global Fixed Interest page for the Summary of investment objective and strategy.

Fund returns 

PIR Total since inception (annualised) 1 Month 3 Month 1 Year 3 Years^
28% 0.93% 0.45% 0.58% 3.46% -1.21%
17.50% 1.26% 0.52% 0.66% 3.97% -1.03%
10.50% 1.48% 0.56% 0.72% 4.32% -0.91%

  ^ Annualised

Fund returns are calculated net of fund charges, trading expenses and accrued tax for a New Zealand resident individual paying tax at the Prescribed Investor Rate identified above. 

Top 10 investments 

  Asset name % of fund net assets
1 Hunter Global Fixed interest Fund  92.99%
2 ANZ transactional bank account 7.01%
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The top ten investments make up 100.00% of the fund.

Manager's Commentary

What happened in the markets that you invest in?

May was a better month for international fixed interest investors, in general.

Pleasingly, market participants were able to look through stubborn inflation numbers and tough central bank rhetoric, preferring instead to keep collectives eyes-on-the-prize: Lower inflation and lower interest rates.

The numbers don’t lie – inflation has fallen – and market forecasters1 expect key global interest rates to start to move lower sometime over the course of this year. 

How did your portfolio perform?

Summer Global Fixed Interest delivered a return net of fees and before tax of 0.63% in May. For the 12 months to the end of May, Summer Global Fixed Interest delivered a return net of fees and before tax of 4.84%.

Apart from an immaterial amount of directly held New Zealand dollar cash (typically 1% of the fund’s value) Summer Global Fixed Interest is fully invested in international fixed interest through its holdings of units in the Hunter Global Fixed Interest Fund (a multi-rate PIE fund), which is hedged to the New Zealand dollar. PIMCO Australia Pty is the investment manager. 

What do we think is going to happen in the next few months?

While central banks will remain vigilant in their inflation fight the sustained multi-year tightening in monetary policy has done its job in reducing inflation; we think inflation will likely prove to be “sticky”, meaning, in our view, that term interest rates and bonds yields are likely to remain at attractive yields for some time yet.

Indeed, PIMCO are well set, in our opinion, to play a long-game anticipating a “soft recession” which in general should be a good outcome for high quality bond portfolios. We estimate the fund’s gross yield-to-maturity to be around 5.502, a duration of close to 5.3 years and a weighted-average portfolio credit quality of AA-3.

 

1Westpac Institutional Bank, What’s Priced In, 31 May 2024

2Gross yield to maturity is calculated as the weighted-average gross yield of all securities in the portfolio as at 

3Weighted-average portfolio credit quality is calculated by PIMCO and is the weighted-average credit rating of each security within the portfolio; where a security is not rated by an external agency, PIMCO will assign a credit rating

 

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.