CASH FUNDS PERFORMANCE
The RBA’s overnight cash rate target was raised by 25bps to 3.85% in May. 3-month BBSW finished the month 30bps higher at 3.98% while 6-month BBSW gained 31bps to 4.17%. Expectations in the cash futures market moved to reflect a higher likelihood of another rate increase in the third quarter of 2023 while lowering the likelihood of a rate cut in 2024. At the end of the month, contracts implied the actual cash rate would fall from 3.82% at the end of May to an average of 3.795% in May 2024.
The benchmark Bloomberg AusBond Bank Bill index returned 0.29% over the month and 2.64% over the 12 months to the end of May.
| AUSTRALIAN CASH FUNDS | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|
| Adelaide Cash Management Trust | 0.21 | 0.54 | 1.13 | 0.44 | 0.44 |
| BT Premium Cash | 0.32 | 0.92 | 2.59 | 0.89 | 1.05 |
| IOOF Cash Management Trust | 0.28 | 0.89 | 2.68 | 0.95 | 1.24 |
| Sandhurst Cash Common Fund | 0.19 | 0.48 | 0.99 | 0.35 | 0.44 |
| UBS Cash | 0.26 | 0.90 | 2.75 | 0.91 | 1.12 |
ENHANCED CASH FUNDS PERFORMANCE
The Antares Income Fund produced a return of 0.47% in May, thus making it the month’s highest-returning enhanced cash fund in the survey. The Perpetual High Grade Treasury Fund and the Realm Short Term Income Fund shared equal-second after they both produced the next-highest return, 0.45%.
The returns of all three funds outperformed the 0.29% return produced by the Bloomberg AusBond Bank Bill Index in May. The Antares fund just managed to exceed the 0.46% returned by the AusBond FRN Index.
In terms of performance over the twelve months to the end of May, the Mutual Income Fund retained its title as the highest performing fund by producing a return of 4.19% for the period. Perpetual’s High Grade Treasury Fund was the next with a return of 3.75% while Realm’s Short Term Income Fund was ranked third with a return of 3.62%.
The Bloomberg AusBond Bank Bill and FRN indices returned 2.64% and 3.66% respectively over the 12-month period to the end of May. The above-mentioned funds all outperformed the Bank Bill Index but only the Mutual and Perpetual funds outperformed the FRN Index.
| AUSTRALIAN ENHANCED CASH FUNDS | ASX mFund | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|---|
| AMP Capital Managed Treasury | 0.32 | 0.93 | 2.85 | 1.04 | 1.24 | |
| Antares Income Fund | ANT01 | 0.47 | 1.07 | 3.46 | 1.71 | 1.66 |
| Australian Ethical Cash Trust | 0.27 | 0.93 | 2.82 | 0.99 | 1.17 | |
| BT Wholesale Enhanced Cash | 0.39 | 1.02 | 3.22 | 1.57 | 1.73 | |
| Dimensional Short Term Fixed Interest | 0.18 | 1.04 | 2.01 | 0.48 | 0.98 | |
| Fiducian Capital Safe | 0.28 | 0.91 | 2.71 | 0.92 | 1.06 | |
| IOOF MultiMix Cash Enhanced Trust | 0.36 | 0.93 | 2.99 | 1.23 | 1.42 | |
| Legg Mason Western Asset Conservative Income Fund | 0.36 | 1.15 | 3.39 | 1.27 | 1.42 | |
| Mutual Income Fund | 0.41 | 1.15 | 4.19 | 2.14 | 2.04 | |
| MLC Wholesale Horizon 1 Bond Portfolio | 0.16 | 0.75 | 1.86 | 0.52 | 0.83 | |
| Henderson Cash Enhanced Trust | 0.33 | 0.88 | 3.14 | 1.35 | 1.55 | |
| Perpetual High Grade Treasury | 0.45 | 1.12 | 3.75 | 2.00 | 2.12 | |
| Prime Value Enhanced Income Fund | -0.45 | 0.22 | 2.41 | 1.50 | 1.55 | |
| Realm Short Term Income Fund | RLM02 | 0.45 | 1.20 | 3.62 | 2.39 | 2.53 |
| Sandhurst Strategic Income A | 0.35 | 0.91 | 2.72 | 1.29 | 1.42 | |
| Smarter Money Active Cash Fund | 0.36 | 0.92 | 2.71 | 1.42 | 1.61 | |
| UBS Cash Plus | 0.32 | 1.00 | 3.09 | 1.18 | 1.44 | |
| Vanguard Cash Reserve | 0.32 | 0.91 | 2.69 | 0.85 | 1.09 | |
| Vanguard Cash Plus | 0.14 | 0.91 | 2.76 | 0.76 | 1.24 | |
| Bloomberg AusBond Bank 0+Y TR AUD | 0.30 | 0.89 | 2.64 | 0.91 | 1.14 |
*End of May 2023. Return in AUD after fees.