Nikko AM Australian Bond Fund - Winner Best Australian Fixed Income Fund in Money Magazine's Best of the Best Awards 2021

Our mission is to deliver consistent, positive returns with no surprises

The Nikko Asset Management fixed income team is a relative value manager that focuses on providing investors with consistent positive returns no matter the conditions.

The Nikko AM Australian Bond fund invests in a diversified portfolio of investment grade Australian fixed income assets, that aims to deliver an active return for a competitive fee.

Investment Objective

The Fund aims to outperform the Bloomberg AusBond Composite 0 + YR Index over any three-year rolling period, before fees, expenses and taxes.

Consistent positive returns

  • Our goal is to achieve higher income than the index.
  • To capture this excess alpha, we use our proprietary system to analyse the relative value between ~3,000 Australian interest rate structures, bonds and sectors.
  • This process delivers a universe of opportunities that are interrogated by our portfolio managers who apply their investment methodology, experience and economic statistics to reinforce their conviction and identify the best returning securities – those that outperform the others.
  • Unlike traditional duration and credit spread managers, we don’t have to rely on picking market direction to capture returns. Instead, we look for the best relative value between securities and sectors that will deliver consistent positive returns for investors.

Portfolio diversification

  • Our Fund is positively correlated with equities when they are rising and negatively correlated when they are falling. This allows us to consistently deliver a positive return no matter the market conditions – offering the diversification investors expect from a fixed income investment.
  • The Fund consists primarily of Australian investment grade securities, which helps mitigate risk.

Proven track record

  • Our mission to provide a core fixed income allocation in your portfolio that provides returns with no surprises. That‘s how we see our mission, that’s who we are.
  • We have the tools to generate alpha in all conditions because we keep our positions appropriately sized and don't focus everything on one position. Relative value helps dictate how and where we hold positions time after time.

Fund characteristics

  • Active, opportunistic & disciplined investment style
  • Diversified across all Australian fixed income sectors
  • Only invests in investment grade securities (securities with a BBB- rating or above)
  • ‘Top-down’ value-adding process merged with ‘bottom-up’ quantitative portfolio construction and credit process
  • Typically invests in 70-130 securities
  • Modified duration of +/- 1.5 years to the benchmark duration
Portfolio Manager Darren Langer
Inception Date July 2000
Benchmark* Bloomberg AusBond Composite 0 + YR Index
Management Cost 0.30% p.a.
Minimum initial investment** $10,000
Minimum additional investment** $1,000
Distribution frequency^ Quarterly following 30 September, 31 December, 31 March and 30 June

* The UBS Australia Bond Indexes have been acquired by Bloomberg, consequently from 29 September 2014 the name of the benchmark has changed from UBS Australian Composite Bond (All Maturities) Index to Bloomberg AusBond Composite 0 + YR Index.
** Nikko Asset Management Australia Limited ABN 34 002 542 038 AFSL 229664 (Nikko AM Australia), is the Responsible Entity and the issuer of units in the Fund and may accept lower amounts at any time at its discretion.
^ Fund returns can be volatile. Nikko AM Australia does not guarantee to provide distributions, or what the amount of distributions may be.

Fund total return figures are calculated using redemption prices, net of fees, assume the reinvestment of distributions and do not take into account taxation.

For periods to {{dateFormat data.performanceDate 'j F Y'}}

Source: BNP Paribas.
Inception Date: July 2000
The value of an investment can rise and fall and past performance is not indicative of future performance. Investment in a fund is not guaranteed. The value of investments will fluctuate up and down with the assets of the fund.

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Darren Langer

Darren Langer,
Senior Portfolio Manager

John Sorrell

John Sorrell,
Head of Credit

Chris Rands

Chris Rands,
Portfolio Manager

Leo Leslie

Leo Leslie,
Senior Portfolio Manager, Loans and Credit

View bios

Video: The 5 biggest myths in fixed income investing

Darren Langer, Senior Portfolio Manager
In this video, Darren debunks the top 5 myths in fixed income