September 2021

Monthly Review

Monthly Insight

During September, Income Generator experienced a decline of -0.6%, taking the year-to-date return to 4.8% and the return over the 11 months since inception to 9.9%.

This month the shares held in the Portfolio were broadly flat as strong performance from companies such as Infratil, Telstra and Commonwealth Bank of Australia was offset by declines by Woolworths, Wesfarmers and Chorus. These declines followed strong share price appreciation in August.

The three largest holdings in the Portfolio all operate in the telecommunications sector. The largest holding is Spark New Zealand, followed by Telstra Australia and Chorus. Why do telecommunications companies make up the largest sector weight in Income Generator?

A telephone and internet connection are a necessity of daily life and as a result consumer demand is very stable. Having a predictable business also means that these companies can pay out a high percentage of their earnings, which make for an attractive dividend.

Income Generator holds seven Australian shares and eleven New Zealand shares.



Past performance is not an indication of future returns.

Fund Performance

4.8%

Year-to-date Returns

30 September 2021

-0.6%

Monthly Return

September 2021

9.9%

Total Returns

Since inception
22 October 2020

Monthly Returns

Share Ownership

New Zealand

  • Spark New Zealand4.88%
  • Chorus3.06%
  • Contact Energy2.86%
  • Ryman Healthcare2.19%
  • Summerset2.11%
  • Mercury NZ Ltd1.94%
  • Mainfreight1.65%
  • Meridian Energy1.62%
  • Infratil1.60%
  • Fisher & Paykel
    Healthcare
    1.39%
  • Fletcher Building1.00%

Australian

  • Telstra3.37%
  • Australia & New Zealand
    Banking Group
    3.03%
  • Commonwealth Bank
    of Australia
    3.02%
  • National Australia
    Bank Ltd
    2.91%
  • Transurban Group2.51%
  • Woolworths Group Ltd1.92%
  • Wesfarmers1.89%
  • Australian index futures7.38%

Fund Overview

Interest rates are low. At NZ Funds, we designed Income Generator to address that.

Income Generator is a new fund, invested primarily in premium New Zealand and Australian dividend-paying shares. It passes these dividends on to you as regular income.

The risk of fluctuating share prices is reduced through the use of tools including put and call options which reduce the fund's volatility. This means Income Generator is for investors who are willing to take on some risk, but do not wish to be fully exposed to the volatility of shares.

We expect Income Generator will become a core allocation in moderate to higher risk investment portfolios, and become an essential tool for New Zealanders with savings to invest.

Income Generator has an expected average return of around 4% ‐ 7% per annum, after fees before tax, on a suggested minimum investment term of 5 years*. It has a risk indicator of 4 – classing it as medium to high volatility.


* Past performance is not an indication of future returns. Expected average annual returns are based on modelled returns only, which may not be an indicator of future returns. For more information on the calculation of expected average annual returns, see the 'Other Material Information' document available on the Disclose website.

Monthly Video

Level 16, 21 Queen Street, Auckland 1010, New Zealand.

New Zealand Funds Management Limited is the Issuer of the NZ Funds Income Generator.

A copy of the NZ Funds Income Generator Product Disclosure Statement is available on request or by visiting the NZ Funds website at www.nzfunds.co.nz.