Update written by Roger Clayton, Salt Funds Management – 13th January 2021

In New Zealand, the S&P/NZX50 Gross rose +11.4% in the quarter lifting the 2020 return to +13.9%. The performance in Q4 was led by Pacific Edge Biotechnology (+94%) on favourable research reports from two brokers, Fletcher Building (+53%) and Mainfreight (+52%) on positive earnings updates. The standout notable detractors were a2 Milk (-21%) on weaker than expected demand for infant formula and Pushpay (-18%) on slowing customer growth. The Fund pleasingly outperformed its benchmark in the December quarter, advancing by +11.74% compared to the +11.44% turned in by the S&P/NZX50 Gross Index.

For more detail, the latest Salt NZ Dividend Appreciation Fund fact sheet can be found here.

The S&P/NZX All Real Estate Gross Index rose by +8.5% in the December quarter. This was despite NZ 10-year bond yields rising sharply from 0.46% to 0.99% over the period. While yields and more importantly bank deposit rates obviously remain at very low levels, investors have continued to flood into higher yielding stocks and ever lower quality property syndicates in search of dividend yield at any price. The Fund delivered a strong period of relative performance in the December quarter, with a return of +10.05% compared to the +8.48% advance turned in by the S&P/NZX All Real Estate Gross Index.

For more detail, the latest Salt Enhanced Property Fund fact sheet can be found here.