Update written by Roger Clayton, Salt Funds Management – 12th February 2021

NZ’s S&P/NZX50 Gross ended the volatile month up +0.3%. The strongest performers were Heartland (+12%) on lower bad debt expectations, Trustpower (+10%) as renewables drifted up, and Freightways (+9%) on a strong demand. The worst performers were Tourism Holdings (-13%) and Air New Zealand (-12%) whose Covid-19 woes continue, and Pacific Edge (-11%) after a meteoric run in 2020. The Fund moderately outperformed its benchmark in the month of January, advancing by +0.54% compared to the +0.27% turned in by the S&P/NZX50 Gross Index. The month was a typically quiet holiday season period without a great deal of major news or volatility

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 declined by a slight -0.25% in the month of January. This was a creditable performance given a backdrop of continued steady increases in long term bond yields, with NZ 10 years moving from 0.99% to 1.10% over the month. There is a tension at present between the impact that they should exert on valuation versus a flood of money fleeing derisory bank deposit rates. The Fund slightly outperformed its benchmark during January, returning -0.13% compared to the -0.25% decline turned in by the S&P/NZX All Real Estate Gross Index. This was a pleasing outcome given the 10% net exposure to the cheaper Australian market, which underperformed NZ by almost 4% during the month.

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