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Forsyth Barr Balanced Fund

The fund was established on 11 December 2020, however applications were accepted from 18 December 2020.

The fund aims to achieve positive long-term returns by choosing exposure across asset classes. Investors can expect moderate to high levels of movement up and down in value and to receive longer term returns that are lower than those of the Growth Fund.


Unit Price

AS AT 4 May 2021

1.0199 NZD

The unit prices shown do not take into account any adjustment for PIE tax.
Buy/sell spreads may apply when transacting. There are currently none.

Month End Unit Price

As at 31 Mar 2021

1.0069 NZD

Managers comment

Market Commentary

The Forsyth Barr Balanced Fund delivered a positive gross return (Gross of Tax and Fees) of 2.20% for the month of March and a gross return 0.63% for the March quarter.

The fund is invested across a number of asset classes in proportions as displayed under the “Target Investment Mix”.

Most equity markets delivered positive returns during the quarter with New Zealand being the exception. Overall, the positive market dynamic was helped by better than expected company earnings, increasing confidence in the effectiveness of COVID-19 vaccines, and a strong outlook for global growth due to the substantial level of fiscal stimulus being deployed by policy makers.

New Zealand equities had a positive return in March, but still ended down for the quarter. Higher interest rates continued to impact negatively on the defensive dividend stocks. Weakness in large companies such as A2 Milk and the electricity retailers also helped drag the down the broader market over the quarter.

New Zealand and international fixed interest returns were generally negative during the quarter despite interest rates stabilising during March. Higher interest rates reflect rising inflationary expectations and an improving outlook for growth as government and central bank policy makers continue to provide a lot of monetary and fiscal stimulus.

The New Zealand dollar weakened during the quarter as other major economies appear to get ahead in the race to vaccinate and open up their economies. This relative growth view favouring economies outside New Zealand has also contributed to the recent relative weakness in New Zealand equities compared to other markets.

Looking Ahead

As we enter the second quarter of the year we have reason to remain cautiously optimistic. Those countries that have had successful starts to their vaccine programmes have shown the rest of the world how effective vaccines are in controlling the rate of infection and hospital admissions. Some countries are already starting to re-open their economies more widely than others. While there is still a long way to go, with many challenges remaining around the supply and distribution of vaccines for the whole world in the race against mutations and new variants, the signs so far look positive.

Long-term interest rates are rising because the growth outlook is a lot more positive and this is contributing to a lift in inflationary expectations. We regard this as a positive development. Company earnings have been better than expected in many sectors and the earnings outlook should continue to be revised higher.

While fixed income investors have struggled in recent months, equities have continued to deliver positive returns and this underscores the importance of diversification within portfolios.

Portfolio Positioning

We will continue to invest the fund’s capital per the target investment mix, which has a slight basis towards growth assets – Australasian equities and listed property – when compared to income assets.

Foreign currency exposures associated with international fixed interest are hedged to the New Zealand dollar. We actively manage the fund’s currency exposures associated with international and Australian equities and listed property. As at 31 March 2021, these exposures represented 39.56% of the value of the fund. After allowing for foreign currency hedges in place, approximately 28.17% of the value of the fund was unhedged and exposed to foreign currency risk.

 

Major Investments

As at 31 Mar 2021

Company name Volume
ANZ transactional bank account 10.65%
Fisher & Paykel Healthcare Corporation Limited 1.85%
Amazon.com, Inc. 1.35%
Housing New Zealand 3.36% 12/06/2025 1.31%
Visa Inc.- Class A Shares 1.27%
New Zealand Local Government Funding Agency Ltd 14/04/2033 3.50% 1.24%
CSL Limited 1.21%
Infratil Limited 1.12%
The a2 Milk Company Limited 1.11%
Spark New Zealand Limited 1.11%
Total portfolio holdings 2223

Performance over time

Return Comparison

As at 31 Mar 2021

1 Month 3 Months 1 Year 3 Years Since commenced operation
Net Fund Return 1 Month 2.08% 3 Months 0.44% 1 Year N/A 3 Years N/A Since commenced operation 0.78%
Gross Fund Return 1 Month 2.20% 3 Months 0.63% 1 Year N/A 3 Years N/A Since commenced operation 1.04%
Composite Index 1 Month 2.02% 3 Months 0.51% 1 Year N/A 3 Years N/A Since commenced operation 1.20%

Net Fund Returns are calculated after deduction of fund charges, trading expenses and accrued tax for a New Zealand resident paying individual tax at the highest Prescribed Investor Rate (28%). Gross Fund Returns are calculated before the deduction of taxes and fund charges but after the deductions of trading expenses and including imputation credits and foreign tax credits where available.

Fund update

As at 31 March 2021

This document tells you how the Forsyth Barr Balanced Fund has performed and what fees were charged. The document will help you to compare the fund with other funds.

General Fund Information

Risk indicator

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The risk indicator is rated from 1 (low) to 7 (high). The rating reflects how much the value of the relevant fund’s assets goes up and down (volatility). A higher risk generally means higher potential returns over time, but more ups and downs along the way. This fund started on 11 December 2020. As the fund has not been in existence for 5 years, we have used market index return data for periods prior to 11 December 2020 and actual fund returns data afterwards. This means that the risk indicator may provide a less reliable indicator of the potential future volatility of the fund. See more information about the risks of investing in the Product Disclosure Statement.


Tactical asset allocation mix (as at 28 February 2021)

Cash and cash equivalents 6.00%
New Zealand fixed interest 21.00%
International fixed interest 10.00%
Australasian equities 33.00%
International equities 25.00%
Listed property 5.00%

Things to note

  • Manager: Forsyth Barr Investment Management Limited
  • Date the fund started: 11 December 2020
  • Tax status: Portfolio Investment Fund (PIE)
  • Minimum suggested investment time frame: At least five years
  • Benchmark: None
  • Currency: New Zealand dollars
  • View the Product Disclosure Statement for detailed information about this Fund and Forsyth Barr Investment Funds Scheme.

Fees

Annual fund charges are currently 1.25% p.a. of the value of your investment. This means that we pay management and administration charges along with the Supervisor fee out of this. All fees and charges are quoted exclusive of GST.

Trail commission may be paid to a Financial Adviser responsible for your Investment Funds account. Any trail fee is paid by Forsyth Barr Limited and is not a separate charge on your Investment Funds account.

Trail commission may be paid to an adviser responsible for your Investment Funds account. Any trail fee is paid by Forsyth Barr Limited and is not a separate charge on your Investment Funds account. Forsyth Barr Investment Management is the manager of the Investment Funds. The comments on this webpage do not take your personal circumstances into account. Before acting on this information, please contact your Forsyth Barr Investment Adviser. Forsyth Barr Limited and its affiliates do not make any representation or warranty (express or implied) that this webpage 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 webpage. This webpage is not intended to be distributed or made available to any person in any jurisdiction where doing so would constitute a breach of any applicable laws or regulations.

Get in touch

23 locations around New Zealand

To find out more about our Forsyth Barr Balanced Fund, speak to one of our expert Investment Advisers. They will help you determine the role an Investment Fund can play in helping you achieve your goals.