CASH FUNDS PERFORMANCE
The RBA’s overnight cash rate target was raised by 25bps in May to 0.35%. 3-month BBSW finished the month 47bps higher at 1.18% while 6-month BBSW gained 48bps to 1.93%. Expectations in the cash futures market moved to reflect a slightly steeper path for the actual cash rate over the second half of 2022 and the first half of 2023. At the end of the month, contracts implied the actual cash rate would rise from the current rate of 0.31% to 3.375% by July 2023.
One month returns for cash funds have become so low a comparison of them has become somewhat redundant. As such, no ranking of them will take place.
Over the twelve months to the end of May, the Adelaide Bank Cash Management Trust remained the top-performing cash fund. The Adelaide Bank trust returned 0.13% over this period while the BT Premium Cash Fund was next with a return of 0.06%.
| AUSTRALIAN CASH FUNDS | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|
| Adelaide Cash Management Trust | 0.01 | 0.03 | 0.13 | 0.14 | 0.35 |
| BT Premium Cash | 0.03 | 0.04 | 0.06 | 0.32 | 0.86 |
| IOOF Cash Management Trust | 0.01 | -0.02 | -0.03 | 0.43 | 1.06 |
| Perpetual Cash Management | n/a | 0.00 | 0.05 | 0.32 | 0.56 |
| Sandhurst Cash Common Fund | 0.00 | 0.00 | 0.02 | 0.10 | 0.38 |
| UBS Cash | 0.03 | -0.01 | 0.02 | 0.32 | 0.91 |
The benchmark Bloomberg AusBond Bank Bill index returned 0.03% over the month and 0.05% over the 12 months to the end of May. The Adelaide Bank and BT funds both outperformed this benchmark over a 1-year time period but both underperformed over periods of 3 years and 5 years.
ENHANCED CASH FUNDS PERFORMANCE
The Realm Short Term Income Fund took the honours as the highest-returning enhanced cash fund in the May survey. The Realm fund produced a return of 0.09% for the month while the Dimensional Short Term Fixed Interest Fund was next with a return of 0.06%. The Vanguard Cash Reserve Fund returned 0.04%, making it the third–highest returning fund in the sector.
The returns of Realm’s and Dimensional’s funds both outperformed the 0.05% return produced by the Bloomberg AusBond Bank Bill index over May. These funds, in addition to the Vanguard fund, all produced returns which exceeded the -0.08% return produced by the AusBond FRN index.
In terms of performance over the twelve months to the end of May, the Realm Short Term Income Fund retained its title as the highest performing fund by producing a return of 0.67%. The BT Enhanced Cash Fund produced the next-highest performance for this period with a return of 0.02% while Vanguard’s Cash Reserve Fund and Pendal’s Wholesale Enhanced Cash Fund both produced returns of -0.10% to rank equal-third.
The Bloomberg AusBond Bank Bill and FRN indices returned 0.05% and -0.31% respectively over the 12-month period to the end of May. All three funds’ returns outperformed the FRN index for this period but only the Realm fund outperformed the Bank Bill index.
| AUSTRALIAN ENHANCED CASH FUNDS | ASX mFund | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|---|
| AMP Capital Managed Treasury | 0.01 | -0.12 | -0.11 | 0.44 | 1.07 | |
| Antares Income Fund | ANT01 | -0.16 | -0.83 | -1.00 | 0.80 | 1.47 |
| Australian Ethical Cash Trust | -0.01 | -0.26 | -0.27 | 0.39 | 0.89 | |
| BT Enhanced Cash | n/a | n/a | 0.02 | 0.70 | 1.24 | |
| BT Wholesale Enhanced Cash | -0.02 | -0.21 | -0.10 | 1.01 | 1.65 | |
| Dimensional Short Term Fixed Interest | 0.06 | -0.84 | -1.24 | 0.05 | 0.84 | |
| Fiducian Capital Safe | -0.01 | -0.22 | -0.24 | 0.29 | 0.87 | |
| IOOF MultiMix Cash Enhanced Trust | -0.06 | -0.54 | -0.60 | 0.65 | 1.27 | |
| Legg Mason Western Asset Conservative Income Fund | -0.07 | -0.53 | -0.63 | 0.54 | 1.19 | |
| MIF | n/a | -0.61 | -0.61 | 0.97 | 1.69 | |
| MLC Wholesale Horizon 1 Bond Portfolio | -0.39 | -1.52 | -2.58 | -0.05 | 0.78 | |
| Henderson Cash Enhanced Trust | -0.15 | -0.91 | -0.97 | 0.76 | 1.39 | |
| Perpetual High Grade Treasury | -0.06 | -0.52 | -0.48 | 1.28 | 1.94 | |
| Prime Value Enhanced Income Fund | -0.75 | -1.75 | -1.11 | 0.56 | 1.64 | |
| Realm Short Term Income Fund | RLM02 | 0.09 | -0.31 | 0.67 | 1.97 | n/a |
| Sandhurst Strategic Income A | -0.16 | -0.37 | -0.64 | 0.74 | 1.31 | |
| Smarter Money Active Cash Fund | -0.15 | -0.32 | -1.14 | 0.89 | 1.51 | |
| UBS Cash Plus | -0.03 | -0.23 | -0.24 | 0.54 | 1.26 | |
| Vanguard Cash Reserve | 0.04 | -0.01 | -0.10 | 0.27 | 0.88 | |
| Vanguard Cash Plus | 0.03 | -0.63 | -0.77 | 0.34 | 1.04 | |
| Bloomberg AusBond Bank 0+Y TR AUD | 0.03 | 0.02 | 0.05 | 0.36 | 0.97 |
*End of May 2022. Return in AUD after fees.