September, 2023
The Fund returned -0.1% for the quarter (before fees) and 7.7% for the year.
Key contributors to performance for the quarter ended 30 September 2023 were:
In another volatile quarter, there were negative returns in share markets and all maturity bonds. The exposure to short maturity bonds and inflation-linked bonds contributed positively to performance. The short maturity strategy returned +1.3% and the inflation-linked bond strategy returned +1.0%.
Note: Returns for the asset classes above are before fees and tax.
Pre Select Balanced Fund
The Fund returned -0.5% for the quarter (before fees) and 10.0% for the year.
Key contributors to performance for the quarter ended 30 September 2023 were:
In another volatile quarter, there were negative returns in share markets and all maturity bonds. The exposure to short maturity bonds and inflation-linked bonds contributed positively to performance. The short maturity strategy returned +1.3% and the inflation-linked bond strategy returned +1.0%.
Note: Returns for the asset classes above are before fees and tax.
Pre Select Growth Fund
The Fund returned -0.9% for the quarter (before fees) and 12.6% for the year.
Key contributors to performance for the quarter ended 30 September 2023 were:
In another volatile quarter, there were negative returns in share markets and all maturity bonds. The exposure to short maturity bonds and inflation-linked bonds contributed positively to performance. The short maturity strategy returned +1.3% and the inflation-linked bond strategy returned +1.0%.
Note: Returns for the asset classes above are before fees and tax.
Pre Select High Growth Fund
The Fund returned -1.0% for the quarter (before fees) and 14.7% for the year.
Key contributors to performance for the quarter ended 30 September 2023 were:
In another volatile quarter, there were negative returns in share markets and all maturity bonds. The exposure to short maturity bonds and inflation-linked bonds contributed positively to performance. The short maturity strategy returned +1.3% and the inflation-linked bond strategy returned +1.0%.
Note: Returns for the asset classes above are before fees and tax
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-13.pdfJune, 2023
The Fund returned 2.0% for the quarter (before fees) and 9.2% for the year.
Key contributors to performance for the quarter ended 30 June 2023 are:
• In another volatile quarter, that saw large monthly swings in both share and bond markets, the Australian shares strategy had a positive return of +1.0% and the global shares unhedged strategy a very strong return of +7.4%.
• Corporate bonds have also benefitted from improving risk appetite with narrower credit spreads. Investors are finding the current corporate yields as now providing attractive income potential compared to recent years. The extended credit strategy returned +1.4%.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-12.pdfMarch, 2023
The Fund returned 4.1% for the quarter (before fees) and 1.2% for the year.
Key contributors to performance for the quarter ended 31 March 2023 are:
• In another volatile quarter, that saw large swings in both share and bond markets, Australian shares had a strong return of +4.4% and global shares unhedged an exceptionally strong return of +9.3%.
• Fixed income returns continued to improve over the quarter. The inflation-linked bonds strategy had a strong return +4.2% and the short-maturity strategy returned +1.7%. Inflation-linked bonds continue to take favour in the scenario where inflation is higher than expected and is further supported by the reset in real rates. Note: Returns for the asset classes above are before fees and tax.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-11.pdfDecember, 2022
The Fund returned 4.2% for the quarter (before fees) and -5.2% for the year.
Key contributors to performance for the quarter ended 31 December are:
In a volatile quarter, that saw large swings in both share and bond markets, Australian and global shares hedged had exceptionally strong returns of +8.4% and +9.2%.
The listed infrastructure exposure had a very strong return of +5.6%. The Inflation-linked bonds strategy has reduced the exposure to inflationary risks while protecting against expectations of lower economic growth.
September, 2022
The Fund returned -1.3% for the quarter (before fees) and -7.6% for the year. Key contributors to performance for the quarter ended 30 September 2022 are:
• The exposure to inflation-linked bonds has reduced exposure to inflationary risks while protecting against expectations of lower economic growth.
• The overweight to global shares unhedged was beneficial due to the persistent strength in the US dollar.
• The fund also invests in the MLC Inflation Plus portfolios, providing important real return exposure and sources of low correlation return streams.
In a volatile quarter for share markets and fixed income, within Inflation Plus, the Low Correlation Strategy and the insurance-related investments strategy both produced strong positive returns of 2.3% and 2.0% respectively.
Note: Returns for the asset classes above are before fees and tax.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-8.pdfJune, 2022
Australian shares were not immune to the sharp sell-off in global share markets over the course of the second quarter of 2022 and delivered a weak return of -11.9% in the three months to June 2022. Many central banks engaged in monetary tightening, raising interest rates to combat high inflation. This in turn heightened investor fears of a global economic recession. The concerns over a slowing global economy and a reduction in demand saw oil prices pull back as the quarter progressed. Iron ore prices also fell sharply as China's zero-COVID policy continued to weigh negatively on economic activity and therefore demand for iron ore.
There continued to be a rotation out of growth and higher multiple companies into value stocks, particularly in defensive areas of the market. The Australian share market’s heavy fall over the June quarter saw all sectors finish lower except for the Utilities and Energy sectors which both eked out small gains. Particularly hard hit were the Information Technology, Materials and Consumer Discretionary sectors as investors repositioned their portfolios more defensively for the expected softer economic times ahead.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-6.pdfMarch, 2022
The Fund returned -2.3% for the quarter (before fees) and 2.1% for the year.
Key contributors to performance for the quarter ended 31 March 2022 are:
• The Australian shares strategy produced a solid return of 2.0% for the March quarter. The gains over the quarter were led by the Resources sector which rallied strongly as the prices of many commodities soared following the introduction of sanctions on Russian commodity exports following the invasion of Ukraine. The major banks also performed well on expectations of interest rate rises and the positive flow on effect this could have on their net interest margins.
• The infrastructure strategy in Inflation Plus has produced a strong return of 3.6% this quarter. Airports have been stronger with healthy earnings following the lifting of international travel restrictions. Railroads have also performed strongly on the view that higher commodity prices would be supportive of North American freight rail operators.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-4.pdfJune, 2021
June quarter. The US Federal Reserve also maintained guidance that interest rates would remain low but did signal consideration for tapering their bond purchase program later this year. European shares made a strong 3.6% return (in local currency terms) with the steady vaccination rollout and gradual relaxation of lockdown restrictions. The European Central Bank’s guidance of continued low interest rates and bond purchases was also supportive for European shares.
Emerging market shares (unhedged) delivered a very strong 6.6% gain for the quarter. This surge was led by large gains for India (8.7%, in local currency terms) with encouraging signs of lower virus infection cases. Global bonds (hedged) delivered a positive 0.9% return for the quarter. Government bond yields have stabilised over recent months as central banks maintained their guidance of low interest rates despite higher inflation. Global high yield bonds (hedged) also made a positive gain of 1.3% for the quarter. Credit spreads have narrowed given improving risk appetites due to the gains in global share markets and more promising economic indicators
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/pre-select-commentaries-3.pdfSeptember, 2020
The Fund increased in value by 1.2% for the quarter (before fees and tax). Strong returns have offset some of the March quarter’s falls so the fund is down only 0.3% for the year to 30 September 2020.
Key contributors to performance for the quarter ended 30 September 2020 are:
• The global shares strategy (hedged to the Australian dollar) delivered a strong return in the September quarter of 4.8%. While Wall Street surged to record highs in early September given vaccine hopes, various factors weighed on global shares later in September. Firstly, and primarily, the virus remains a troubling global threat with new infection cases rising again. Secondly, political risk is becoming more prominent, in particular the US Presidential election. Global share markets continue to be narrowly led, with those companies delivering on earnings growth being handsomely rewarded, while those stocks with any economic sensitivity are being punished. Strength in the Australian dollar also added to this global shares strategy return because it’s hedged to the Australian dollar.
• The global shares strategy (not hedged to the Australian dollar) also contributed with a 2.5% return. The return was lower than hedged global shares because the Australian dollar appreciated in value, as it tends to do when global share markets rise.
• The fixed income strategy delivered a positive return of 1.0%. Global government and corporate bonds have delivered solid returns over the past quarter. Assertive central bank bond buying and hopes for a virus vaccine has seen investors become more comfortable with credit risk. The revival in global share markets has also contributed to improving risk appetites.With the extraordinarily low levels of government bond yields across the developed world (most notably Germany and Japan which are below 0% for long maturities), we have tilted the strategy modestly towards credit assets where yields are higher and the interest rate risk (duration) is lower.
asset_class: Multi-Asset
asset_category: 41-60% Growth Assets - Multi-Manager
peer_benchmark: Multi-Asset - 41-60% Multi-Manager Index
broad_market_index: Multi-Asset Balanced Investor Index
manager_contact_details: Array
ticker: NUN0002AU
release_schedule: Quarterly
commentary_block: Array
factsheet_url:
Fund Commentaries
or try:
https://www.mlc.com.au/content/dam/mlc/documents/pdf/investments/pre-select-commentaries.pdf
fund_features:
NUN0002AU Pre-Select Balanced Fund aims to provide medium to long term returns that are generally higher than those achievable by investing in conservative funds. Maintain a balanced spread of investments between growth and defensive assets. The likelihood of the portfolio incurring a negative return in any particular year is moderate to high.
structure: Managed Fund