In Australia, the 10-year Treasury bond yield trended upwards at a moderate rate through most of the month before rising quite sharply over the last few days of it. By the end of the month, the 3-year ACGB yield had jumped 92bps to 1.40%, the 10-year yield had gained 60bps to 2.12% while the 20-year yield finished 47bps higher at 2.63%.
Conditions facing fund managers were demanding for a second consecutive month and the various benchmark indices reflected this. The FRN Index was again the best performer after it returned -0.10% for the month. The Corporate Bond Index produced the second-highest return, -2.76%, and the Composite Index, representing a mix of federal, state and corporate bonds, was next with a return of -3.56%. The Semi-Government Index was just behind with a return of -3.58% and the Treasury Index, representing Commonwealth bonds, returned -3.82%.
Only two out of 33 managers in the YieldReport survey produced positive results. The month’s median return was -3.54%.
The Realm Strategic Income Fund (Enduring Units) produced a return of 0.51%, thus making it the highest performing fund in the October survey. The Alexander Credit Opportunities Fund returned 0.34%, making it the second-best performer while the Spectrum Strategic Income took third place with a return of -0.17%.
On a 12-month basis, the Realm Strategic Income Fund (Enduring Units) took over from the Alexander Credit Opportunities Fund as the highest performing fund in October. The Realm fund returned 6.20% over the 12 months to the end of October while the next highest return came from the Alexander fund with a return of 5.67%. Realm’s High Income (Wholesale) Fund again had the third-highest 12-month performance with a return of 3.20%.
| AUSTRALIAN FIXED INTEREST | ASX mFund | 1m (%) | 3m (%) | 1y (%) | 3y (%) | 5y (%) |
|---|---|---|---|---|---|---|
| Advance Aus Fixed Intr Multi-Blend | -3.70 | -5.21 | -5.70 | 1.80 | 1.46 | |
| AMP Capital Corporate Bond | ACA02 | -0.45 | -0.34 | 1.81 | 2.33 | 2.64 |
| Alexander Credit Opportunities Fund | 0.34 | 1.12 | 5.67 | 4.62 | 5.10 | |
| Alpha Enhanced Yield | IWM05 | -0.42 | -1.09 | 2.85 | 0.44 | 0.54 |
| AMP Flex Lifetime S2-AMP Australian Bond | -3.48 | -5.00 | -5.25 | 2.33 | 1.96 | |
| AMP Generations BlackRock Aust Fixed Interest Index | -3.63 | -5.17 | -6.37 | 1.54 | 1.39 | |
| Altius Bond Fund | -1.98 | -2.48 | -3.52 | 0.69 | 1.16 | |
| Artesian Corporate Bond Fund | -0.60 | -0.59 | 1.57 | 2.67 | n/a | |
| Pendal Enhanced Credit (Wholesale) | -2.75 | -3.52 | -2.35 | 3.04 | 3.04 | |
| BT Fixed Interest Retail | -3.47 | -4.86 | -5.66 | 1.89 | 1.55 | |
| Pendal Fixed Interest (Wholesale) | -3.60 | -5.03 | -6.14 | 2.47 | 2.20 | |
| Pendal Government Bond | -3.63 | -5.15 | -5.95 | 2.93 | 2.56 | |
| CFS Aberdeen Australian Fixed Interest | -3.75 | -5.18 | -5.58 | 1.65 | 1.42 | |
| CFS Wholesale Australian Bond | -3.22 | -4.62 | -5.26 | 2.93 | 2.43 | |
| DDH Fixed Interest | -3.53 | -4.92 | -5.01 | 2.79 | 2.50 | |
| Spectrum Strategic Income | SPE01 | -0.17 | 0.05 | 1.96 | 2.58 | 3.29 |
| Jamieson Coote Bonds Active | -4.10 | -5.65 | -6.71 | 2.58 | 2.41 | |
| Legg Mason Western Asset Australian Bond Trust | LMA04 | -3.61 | -4.99 | -5.13 | 2.87 | 2.76 |
| Macquarie Australian Fixed Interest | -4.00 | -5.25 | -5.57 | 2.77 | 2.61 | |
| Mercer Australian Sovereign Bond Fund | -3.87 | -5.43 | -6.56 | 2.72 | 2.42 | |
| Nikko AM Australian Bond | -3.59 | -5.02 | -5.33 | 2.90 | 2.73 | |
| Henderson Australian Fixed Interest (Inst) | -3.96 | -5.25 | -4.84 | 3.09 | 2.88 | |
| Henderson Tactical Income | -0.54 | -0.45 | 0.32 | 2.34 | 2.47 | |
| Perpetual WFIA-Schroder Fixed Income | -3.88 | -5.35 | -4.66 | 2.48 | 1.97 | |
| Perpetual WFIA-Vanguard Aust Fixed Interest Index | -3.50 | -5.00 | -5.68 | 1.67 | 1.43 | |
| PIMCO Australian Bond (Wholesale) | PMF04 | -3.57 | -5.05 | -4.89 | 2.58 | 2.42 |
| PIMCO Australian Focus (Wholesale) | PMF05 | -1.81 | -2.84 | -2.76 | 2.09 | 2.15 |
| Realm High Income (Wholesale) | -0.62 | -0.31 | 3.20 | 4.33 | 4.04 | |
| Realm Strategic Income - Enduring Units | 0.51 | 1.59 | 6.20 | n/a | n/a | |
| SSgA Australian Fixed Income | -3.58 | -4.99 | -5.49 | 2.59 | 2.44 | |
| UBS Australian Bond Fund | -3.72 | -5.11 | -5.58 | 2.41 | 2.46 | |
| Vanguard Australian Fixed Interest Index | UAM04 | -3.54 | -5.01 | -5.53 | 2.50 | 2.36 |
| Vanguard Australian Govt Bond Index | -3.75 | -5.30 | -6.07 | 2.56 | 2.27 | |
| Bloomberg AusBond Composite 0+YR AUD | -3.55 | -4.93 | -5.30 | 2.72 | 2.58 |
*End of October 2021. Return in AUD after fees