The 10-year Australian Treasury bond yield moved higher at modest pace in the first week of June. It then shot up over the next week before trending lower over the remainder of the month. By the end of it, the 3-year ACGB yield had added 43bps to 3.36%, the 10-year yield had gained 36bps to 3.72% while the 20-year yield finished 23bps higher at 3.92%.
As a result, conditions facing fund managers in June remained tough. The FRN Index was again the best performer after it returned -0.07% for the month. The Treasury Index, representing Commonwealth bonds, produced the second-highest return of -1.32%, while the Corporate Bond Index was just behind it with a return of -1.34%. The return of the Composite Index, representing a mix of federal, state and corporate bonds, returned -1.48% and the Semi-Government Index returned -1.97%.
Only 2 out of 32 managers in the YieldReport survey produced positive results and the month’s median return was -1.57%.
The Alexander Credit Opportunities Fund produced a return of 0.32% in the June survey, thus retaining the title as the best performing fund for the month. The Realm Strategic Income (Enduring Units) Fund produced a return of 0.28%, again making it the second-highest returning fund in the sector while the Alpha Enhanced Yield Fund was next with a return of 0.00%.
On a 12-month basis, the Realm Strategic Income Fund (Enduring Units) retained its title as the highest performing fund in June. The Realm fund returned 5.16% while the next highest return again came from the Alexander Credit Opportunities Fund with a return of 4.31%. The Realm High Income (Wholesale) Fund had the third-highest 12-month performance (again) with a return of 0.14% (again).
| AUSTRALIAN FIXED INTEREST | ASX mFund | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|---|
| Advance Aus Fixed Intr Multi-Blend | -1.88 | -4.78 | -12.42 | -3.61 | -0.44 | |
| AMP Capital Corporate Bond | ACA02 | -0.52 | -0.88 | -2.32 | 0.94 | 1.73 |
| Alexander Credit Opportunities Fund | 0.32 | 0.97 | 4.31 | 4.36 | 4.78 | |
| Alpha Enhanced Yield | IWM05 | 0.00 | -1.15 | -6.27 | -1.82 | -1.01 |
| AMP Flex Lifetime S2-AMP Australian Bond | -1.90 | -4.79 | -12.14 | -3.36 | -0.02 | |
| AMP Generations BlackRock Aust Fixed Interest Index | -1.57 | -4.07 | -11.49 | -3.67 | -0.30 | |
| Altius Bond Fund | n/a | n/a | n/a | n/a | n/a | |
| Artesian Corporate Bond Fund | -0.68 | -1.62 | -3.45 | 0.66 | 2.05 | |
| Pendal Enhanced Credit (Wholesale) | -1.41 | -3.32 | -8.89 | -1.30 | 1.31 | |
| BT Fixed Interest Retail | -1.59 | -4.12 | -11.07 | -3.24 | -0.08 | |
| Pendal Fixed Interest (Wholesale) | -1.66 | -4.11 | -10.91 | -2.62 | 0.56 | |
| Pendal Government Bond | -1.65 | -4.20 | -11.03 | -2.71 | 0.84 | |
| CFS Aberdeen Australian Fixed Interest | -1.74 | -4.21 | -11.67 | -3.39 | -0.29 | |
| CFS Wholesale Australian Bond | -1.96 | -4.35 | -10.97 | -2.52 | 0.62 | |
| DDH Fixed Interest | -1.70 | -4.37 | -11.42 | -2.68 | 0.63 | |
| Spectrum Strategic Income | SPE01 | -0.12 | -0.25 | -0.30 | 1.20 | 2.51 |
| Jamieson Coote Bonds Active | -1.39 | -3.92 | -11.55 | -3.19 | 0.62 | |
| Legg Mason Western Asset Australian Bond Trust | LMA04 | -1.80 | -4.45 | -11.48 | -2.75 | 0.80 |
| Macquarie Australian Fixed Interest | -1.65 | -4.21 | -11.13 | -2.60 | 0.82 | |
| Mercer Australian Sovereign Bond Fund | -1.39 | -3.84 | -11.03 | -3.13 | 0.75 | |
| Nikko AM Australian Bond | -1.91 | -4.29 | -11.41 | -2.73 | 0.84 | |
| Henderson Australian Fixed Interest (Inst) | -2.00 | -5.06 | -12.36 | -2.49 | 0.74 | |
| Henderson Tactical Income | -1.17 | -2.84 | -3.75 | 0.40 | 1.46 | |
| Perpetual WFIA-Schroder Fixed Income | -1.47 | -4.27 | -12.09 | -2.88 | 0.13 | |
| Perpetual WFIA-Vanguard Aust Fixed Interest Index | -1.57 | -3.93 | -10.77 | -3.36 | -0.13 | |
| PIMCO Australian Bond (Wholesale) | PMF04 | -1.87 | -4.42 | -11.56 | -2.88 | 0.51 |
| PIMCO Australian Focus (Wholesale) | PMF05 | -1.16 | -2.32 | -6.90 | -1.30 | 0.85 |
| Realm High Income (Wholesale) | -1.97 | -2.70 | -2.42 | 2.34 | 2.84 | |
| Realm Strategic Income - Enduring Units | 0.28 | 0.94 | 5.16 | n/a | n/a | |
| SSgA Australian Fixed Income | -1.51 | -3.85 | -10.68 | -2.76 | 0.72 | |
| UBS Australian Bond Fund | -1.76 | -4.31 | -11.33 | -2.98 | 0.57 | |
| Vanguard Australian Fixed Interest Index | UAM04 | -1.57 | -3.91 | -10.68 | -2.80 | 0.64 |
| Vanguard Australian Govt Bond Index | -1.54 | -4.04 | -11.16 | -3.07 | 0.57 | |
| Bloomberg AusBond Composite 0+YR AUD | -1.48 | -3.81 | -10.51 | -2.58 | 0.87 |
*End of June 2022. Return in AUD after fees