The 10-year Australian Treasury bond yield trended downwards from the early days of May through to the middle of the month. It then reversed course and trended upwards for the remainder of the month. By the end of May, the 3-year ACGB yield had added 2bps to 4.05%, the 10-year yield had lost 2bps to 4.42% while the 20-year finished 2bps higher at 4.71%.
As a result, conditions facing fund managers were fairly benign. The Bloomberg Ausbond Corporate Bond Index was the best performer after it returned 0.70% for the month. The FRN Index produced the second-highest return of 0.50%, while the Composite Index, representing a mix of federal, state and corporate bonds, was next with a return of 0.39%. The Treasury Index, representing Commonwealth bonds, returned 0.35% while the Semi-Government Index returned 0.29%.
All 32 funds in the YieldReport survey produced positive results and the month’s median return was 0.45%.
The Realm High Income (Wholesale) Fund produced a return of 1.08%, making it the highest returning fund for the month. Realm’s Strategic Income (Enduring Units) Fund was next with a return of 0.82% while the Alexander Credit Opportunities Fund was third with a return of 0.67%.
On a 12-month basis, Realm’s High Income Fund took retained the title of highest performing fund. The fund returned 11.81% while the next-highest return came from Realm’s Strategic Income Fund with a return of 10.67%. The Alexander Credit Opportunities Fund retained third place after it produced a 12-month return of 8.85%.
| AUSTRALIAN FIXED INTEREST | ASX mFund | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|---|
| Advance Aus Fixed Intr Multi-Blend | 0.34 | -0.68 | 0.52 | -2.91 | -1.29 | |
| AMP Capital Corporate Bond | ACA02 | 0.51 | 0.95 | 4.93 | 2.07 | 2.29 |
| Alexander Credit Opportunities Fund | 0.67 | 2.20 | 8.86 | 6.62 | 5.62 | |
| AMP Flex Lifetime S2-AMP Australian Bond | 0.39 | -0.68 | 0.63 | -2.77 | -1.10 | |
| AMP Generations BlackRock Aust Fixed Interest Index | 0.35 | -0.67 | 0.30 | -2.89 | -1.48 | |
| Altius Sustainable Bond Fund | 0.45 | 0.28 | 3.01 | 0.43 | 0.58 | |
| Artesian Corporate Bond Fund | 0.74 | 1.72 | 7.79 | 2.98 | 2.97 | |
| Pendal Enhanced Credit (Wholesale) | 0.70 | 0.67 | 4.56 | -0.11 | 1.13 | |
| Pendal Fixed Interest (Wholesale) | 0.39 | -0.62 | 0.76 | -2.14 | -0.46 | |
| Pendal Government Bond | 0.29 | -0.87 | 0.42 | -2.21 | -0.60 | |
| CFS Aberdeen Australian Fixed Interest | 0.52 | -0.33 | 1.43 | -2.34 | -0.93 | |
| CFS Wholesale Australian Bond | 0.40 | -0.11 | 1.23 | -2.11 | -0.37 | |
| DDH Fixed Interest | 0.37 | -0.47 | 1.10 | -2.18 | -0.44 | |
| Spectrum Strategic Income | SPE01 | 0.63 | 0.43 | 6.60 | 3.09 | 2.74 |
| Jamieson Coote Bonds Active | 0.37 | -0.68 | -0.50 | -2.85 | -1.17 | |
| Legg Mason Western Asset Australian Bond Trust | LMA04 | 0.50 | -0.40 | 1.48 | -2.00 | -0.38 |
| Macquarie Australian Fixed Interest | 0.45 | -0.45 | 1.30 | -1.83 | -0.27 | |
| Mercer Australian Sovereign Bond Fund | 0.34 | -0.59 | -0.24 | -2.66 | -1.13 | |
| MLC Wholesale Horizon 1 Bond Portfolio | 0.68 | 1.22 | 6.51 | 1.86 | 1.61 | |
| Nikko AM Australian Bond | 0.36 | -0.64 | 1.30 | -1.92 | -0.35 | |
| Henderson Australian Fixed Interest (Inst) | 0.47 | -0.68 | 1.65 | -2.07 | -0.14 | |
| Henderson Tactical Income | 0.49 | 0.62 | 5.67 | 2.09 | 2.30 | |
| Perpetual WFIA-Schroder Fixed Income | 0.43 | -0.15 | 1.66 | -2.60 | -0.74 | |
| Perpetual WFIA-Vanguard Aust Fixed Interest Index | 0.28 | -0.65 | 0.45 | -2.46 | -1.20 | |
| PIMCO Australian Bond (Wholesale) | PMF04 | 0.56 | -0.22 | 1.76 | -2.07 | -0.45 |
| PIMCO Australian Focus (Wholesale) | PMF05 | 0.76 | 0.86 | 3.60 | -0.04 | 0.69 |
| Realm High Income (Wholesale) | 1.08 | 2.70 | 11.81 | 5.25 | 4.94 | |
| Realm Strategic Income - Enduring Units | 0.82 | 2.66 | 10.67 | 7.94 | n/a | |
| SSgA Australian Fixed Income | 0.40 | -0.51 | 0.89 | -2.19 | -0.68 | |
| UBS Australian Bond Fund | 0.48 | -0.57 | 1.38 | -2.04 | -0.59 | |
| Vanguard Australian Fixed Interest Index | UAM04 | 0.31 | -0.61 | 0.64 | -2.29 | -0.76 |
| Vanguard Australian Govt Bond Index | 0.32 | -0.82 | -0.01 | -2.73 | -1.08 | |
| Bloomberg AusBond Composite 0+YR AUD | 0.39 | -0.50 | 0.87 | -2.09 | -0.55 |
*End of May 2024. Return in AUD after fees