Process
Investment Objective
The fund’s objective is to outperform its Benchmark over a rolling three year period by investing in a broadly diversified portfolio of fixed income securities (both Australian and international).
The Australian fixed income component includes coupon bonds (Australian Commonwealth, semi-government and corporate bonds), and inflation-linked bonds.
In addition, we seek to enhance returns and improve diversification by including allocations to both high yield and global fixed income securities.
The fund’s exposure to high yield securities will be predominately to high yielding corporate debt, but may also include convertible notes and preference shares. The global fixed income allocation may include exposure to government, corporate and other asset backed securities.
Investment guidelines and ranges
| |
Minimum
|
Benchmark Allocation
|
Maximum
|
As at 31
August 2009
|
Australian fixed |
30% |
|
75% |
|
100% |
|
63.1% |
|
> Coupon bonds |
0% |
|
75% |
|
100% |
|
63.1% |
|
> Inflation-linked bonds |
0% |
|
- |
|
20% |
|
0.0% |
|
High yield securities |
0% |
|
- |
|
20% |
|
9.4% |
|
Global bonds |
0% |
|
25% |
|
50% |
|
24.7% |
|
Cash/short-term securities |
0% |
|
0% |
|
20% |
|
2.8% |
|
|
Investment Process
Portfolio management and construction for the Australian fixed income component are the output of our “what’s in the price” analysis.
