mynorth® managed portfolios family wealth core …...portfolio income paid out to platform cash...

Investment objective To outperform the Morningstar Australian Multi-Sector Moderate TR AUD Index over the medium to longer term. This managed portfolio is designed for a conservative investor.

Key information

Code NTH0028

Manager name Mercer

Inception date 4 September 2019

Benchmark Morningstar Australian Multi-Sector

Moderate TR AUD

Asset class Diversified

Current number of assets 15 (wholesale funds)

Minimum investment horizon 3 years

Portfolio income Paid out to platform cash account and

reinvested

Investment management fee 0.15% pa

Total indirect costs1 0.49% pa

Total estimated management

costs1

0.64% pa

Risk band/label 3/ Low to Medium

Minimum investment amount $500

Website northonline.com.au

Returns as at 31 March 2020

Managed portfolios may be managed to target a mix of income and

growth assets, thus when total return is calculated, there is a percentage

of growth return and income return. This is detailed in the table below.

Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -4.98% -5.74% – – –

Growth2 -5.87% -6.24% – – –

Income2 0.88% 0.50% – – –

Performance history

$10,000 invested since 1 October 2019 as at 31 March 2020

Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -4.98% -5.74% – – –

Benchmark -4.27% -4.44% – – –

Asset allocation as at 31 March 2020

Asset allocation data sourced via Morningstar from the underlying fund manager3.

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600

$10,800

$11,000

$11,200

1 Oct 31 Oct 30 Nov 31 Dec 31 Jan 29 Feb 31 Mar

Managed portfolio Benchmark

11.4%

13.7…

3.0%

3.1%

25.4%

14.7%

28.8%

Asset class Allocation (%)

Growth assets 31.2

▪ Australian shares 11.4

▪ International shares 13.7

▪ Property 3.0

▪ Other 3.1

Defensive assets 68.8

▪ Australian fixed income 25.4

▪ International fixed income 14.7

▪ Cash 28.8

Time

MP

Bala

nce (

$A

U)

1 Estimated as of 31 March 2020. Please refer to the PDS for further information regarding fees, costs and risk profile. 2 Past performance is not a reliable indicator of future performance. The managed portfolio performance represents total return for the periods. Returns have been calculated using the time-weighted method, they assume distributions are reinvested and are after investment management fees and indirect costs. Total and growth returns include accrued distributions, while income return includes paid distributions only. Returns do not take into account tax payable. Individual client returns may vary based on the contributions, withdrawals, and timing differences within the managed portfolio. 3 The Morningstar name is a registered mark of Morningstar, Inc.

MyNorth® Managed Portfolios

Family Wealth Core Satellite Portfolio – 30% Growth Quarterly update for quarter ending 31 March 2020

https://www.northonline.com.au/

Managed portfolio holdings

Growth Target allocation (%)

Australian shares

VAN0002AU Vanguard Australian Shares Index 5.00

SOL0001AU Solaris Australian Equity Fund (Performance Alignment) 4.50

CSA0131AU Aberdeen Wholesale Australian Small Companies Fund 3.00

International shares

VAN0003AU Vanguard International Shares Index 2.00

VAN0105AU Vanguard International Shares Index (Hedged) 3.00

AMP8663AU Arrowstreet Advantage Global Equity 2.00

FID0010AU Fidelity Asia 3.00

Listed property/infrastructure

VAN0004AU Vanguard Property Securities Index Fund 3.00

AMP5018AU Lazard Advantage Global Listed Infrastructure Fund 3.00

Alternatives

AMP5581AU Invesco Advantage Wholesale Global Targeted Returns Fund 3.00

Defensive

Fixed interest

VAN0001AU Vanguard Wholesale Australian Fixed Interest Index 13.00

ETL0018AU Pimco Global Bond Fund 10.00

AMP7750AU AMP Capital Advantage Corporate Bond Fund 12.00

AMP2068AU Bentham Advantage Global Income Fund 6.00

Cash

SBC0811AU UBS Cash Fund 27.50

Target fund allocations align to the indicative asset allocation ranges within the PDS.

Quarterly manager commentary

Market update

The announcement of COVID-19 as a global pandemic has caused severe stresses across global economies and financial markets. Risk asset returns have plummeted over the quarter, as investors flocked to safe-haven assets such as government bonds and cash.

Over the quarter, many equity markets around the world realised double-digit losses. Equities in China and Japan held up relatively well over the quarter, while markets in Latin America, India and Australia lost more than 20%. In Europe, stocks in Italy and Spain were hit particularly hard, due to the massive coronavirus death tolls that these nations were faced with over March.

Government actions across the globe, in an attempt to constrain the virus spread, are expected to have severe economic implications which will likely result in pushing the global economy into a deep and far-reaching recession. Whilst Government fiscal policies have been unprecedented, the anticipation of an economic growth fallout has resulted in forecasts for negative global growth for 2020 and some recovery only in 2021.

Over the first quarter of 2020, the Australian Dollar experienced double-digit losses against most major currencies, including the US Dollar (-12.9%), Japanese Yen (-12.2%) and the Euro (-10.4%). Consequently, Australian investors with unhedged equity allocations were provided some downside protection in the sell-off of global equities, as the unhedged MSCI World ex Australia index outperformed its hedged Australian Dollar counterpart by 12.1% over the quarter.

The Australian share market underperformed its hedged international counterpart, as the S&P/ASX300 returned -23.4% over the quarter. Healthcare (+1.5%) and Consumer Staples (-3.7%) were the strongest performing sectors, while the weakest performing sector was Energy (-48.2%), which was primarily driven by the global collapse in oil prices.

Outlook

The outlook for 2020 now depends almost entirely on the path of COVID-19. If the virus trajectory peaks and governments manage to contain its spread, the global economy may go through a relatively short, but very deep recession before rebounding. There are other scenarios to consider as well, such as a stop start case whereby parts of the economy become reinfected once controls are lifted. Alternatively, the virus may also be exhausted out due to seasonal effects of warmer weather, which will lead to a sharp decline in new infections.

Either way, different industries will re-emerge at different pace, strength and form. For now, it is positive to see that the virus seems to have been contained in China where the government has employed drastic lockdown measures. New daily cases have fallen to close to zero and a large portion of the country have returned to work with heightened security and testing. We do expect a cautious approach towards relaxation of strict lockdown rules and anticipate some safeguards and procedures such as social distancing and heightened sanitisation to remain for an extended period.

Important Information ®Registered trademark of NMMT Limited (ABN 42 058 835 573 AFS License 234653). NMMT Limited (ABN 42 058 835 573, AFSL 234653), which is part of the AMP Group, is the responsible entity of MyNorth Managed Portfolios (ARSN 624 544 136) (Scheme) and issuer of interests in the Scheme. To invest in the Scheme, investors will need to obtain the current Product Disclosure Statement (PDS) which is available at northonline.com.au. The PDS contains important information about investing in the Scheme and it is important investors read the PDS before making a decision about whether to acquire, continue to hold or dispose of interests in the Scheme. If a person decides to purchase or vary a financial product, companies within the AMP group will receive fees and other benefits, which will be a dollar amount or a percentage of either the premium they pay or the value of their investments. Contact North Operations on 1800 667 841 for more details. Neither NMMT, nor any other company in the AMP Group guarantees the repayment of capital or the performance of any product or any particular rate of return referred to in this quarterly update. Past performance is not a reliable indicator of future performance. While every care has been taken in the preparation of this document, NMMT makes no representation or warranty as to the accuracy or completeness of any statement in it including without limitation, any forecasts. This quarterly update has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. Investors should, before making any investment decisions, consider the appropriateness of the information in this quarterly update and the PDS, and seek professional advice, having regard to their objectives, financial situation and needs.

Globally, the number of infections and deaths are increasing, particularly in the United States where the consensus is that restrictions are insufficient and not enough people have been tested. The rate of new infections has now begun slowing in some of the worst affected countries in Europe, such as Italy and Spain, which together with some of the Asian countries offers a glimmer of hope. Most countries have now adopted varying degrees of lockdown, although some will find it harder to implement, particularly developing countries.

The shock to economic growth of the coronavirus are pronounced but remain largely manageable as policy makers have acted swiftly and delivered sizeable programs to support incomes and cash flow to the economy and markets. Interest rates in most parts of the world are at record lows, and in the developed world, vary between 0.00% and 0.25%. We expect monetary policy settings to remain accommodative for the next 12 months along with expansionary fiscal policy settings to aid the eventual recovery.

While uncertainty currently dominates market sentiment, there remains one certainty - that is, the crisis will end and normality will return to the functioning of the global economy. Investors should be reminded that the majority of the value of shares is determined, not by the cash flow received in the year ahead, but by the sum of the cash flows received over many years into the future. Share markets have a history of overshooting or overreacting in the downward direction in periods of uncertainty and panic. This will often result in significant opportunities for investors who are prepared to stick with their long-term strategies and maintain long-term asset class exposures.

Portfolio update

The 30% Growth Portfolio returned -5.74%% for the quarter, compared to the benchmark return of -4.44%.

The defensive investments in the portfolio helped to cushion the steep declines recorded in all equity markets. Most notable was the positive return from the Vanguard Australian Fixed Interest Index Fund (3.0%) and the UBS Cash Fund (0.3%). The Pimco Global Bond Fund (-2.1%) and the AMP Advantage Corporate Bond Fund (-2.2%), while showing negative returns for the quarter, also offset the sharp falls in the equity funds. The recent investment in the Invesco Advantage Global Targeted Returns Fund (-0.5%), funded from a reduction in international shares, played a very positive role diversifying the equity risk in the portfolio.

Equity funds which performed relatively well included the Fidelity Asia Fund (-6.6%), and the Vanguard International Shares Index Fund (-9.0%). This fund is unhedged and benefitted from the sharp fall in the Australian Dollar over the quarter. Australian shares fell sharply. The Vanguard Property Securities Index Fund (-34.3%), the Solaris Australian Equity Fund (-25.2%) and the Vanguard Australian Shares Index Fund (-23.4%) contributed to the negative portfolio result.

The following transactions were implemented during the quarter:

• A switch from the AMP Capital Advantage Core Infrastructure Fund to the Lazard Advantage Global Listed Infrastructure Fund. Listed infrastructure assets were sold down heavily in the early stages of the market decline, whereas the valuation of unlisted assets remained steady. The AMP Core Infrastructure Fund holds a large percentage of unlisted assets, which we expect will be repriced over the coming months to reflect the decline in asset values in the infrastructure sector. This presented an opportunity to exit the AMP fund at an attractive level and reinvest in the Lazard Advantage Global Listed Infrastructure Fund holding only listed assets trading at levels fully reflecting the recent price declines.

• The investment in the Paradice Global Small Mid Cap Fund was sold and the proceeds invested in the Vanguard (hedged and un-hedged) International Share Index funds. In the current risk averse market environment, we expect small cap shares to underperform and take some time to recover. A global equity rebound is likely to occur first in large liquid stocks found in the Vanguard funds rather than global small cap shares. We also took the opportunity to increase the hedging in the portfolio as the Australian Dollar had fallen sharply and we expect will show some recovery in the near term. This was achieved by weighting the purchases of the Vanguard International Share funds to the hedged version.

• In addition to investing the proceeds from the Paradice Fund, the cash holdings were reduced to add to Australian and international shares to take advantage of the very sharp declines in share prices that occurred over a very short period.

http://www.northonline.com.au/

Investment objective To outperform the Morningstar Australian Multi-Sector Balanced TR AUD Index over the medium to longer term. This managed portfolio is designed for a moderately conservative investor.

Key information

Code NTH0029

Manager name Mercer



Balanced TR AUD





reinvested




costs1

0.71% pa

Risk band/label 4/ Medium







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -7.77% -9.10% – – –

Growth2 -8.71% -9.62% – – –

Income2 0.94% 0.51% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -7.77% -9.10% – – –

Benchmark -7.70% -8.45% – – –



$9,200

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600

$10,800

$11,000


Column1 Benchmark

21.0%

20.2%

3.1%6.1%17.4%

12.7%

19.5%


Growth assets 50.4



▪ Property 3.1

▪ Other 6.1




▪ Cash 19.5

Time

MP

Bala

nce (

$A

U)







Australian shares



AMP9163AU Bennelong Advantage ex-20 Australian Equities Fund 3.00










Alternatives


Defensive

Fixed interest





Cash




Market update






Outlook







Portfolio update

The 50% Growth Portfolio returned -9.10% for the quarter, compared to the benchmark return of -8.45%.






• In addition to investing the proceeds from the Paradice Fund, the cash holdings were reduced to add to Australian and

international shares to take advantage of the very sharp declines in share prices that occurred over a very short period.


Investment objective To outperform the Morningstar Australian Multi-Sector Growth TR AUD Index over the medium to longer term. This managed portfolio is designed for a balanced investor.

Key information

Code NTH0030

Manager name Mercer



Growth TR AUD





reinvested




costs1

0.75% pa

Risk band/label 5/ Medium to High







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -9.69% -11.53% – – –

Growth2 -10.63% -12.03% – – –

Income2 0.94% 0.50% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -9.69% -11.53% – – –

Benchmark -10.97% -12.14% – – –



$8,800

$9,000

$9,200

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600

$10,800



25.8%

33.7%4.2%

8.6%

9.3%

7.1%

11.4%


Growth assets 72.3



▪ Property 4.2

▪ Other 8.6




▪ Cash 11.4

Time

MP

Bala

nce (

$A

U)







Australian shares













Alternatives


Defensive

Fixed interest





Cash




Market update






Outlook







Portfolio update









Investment objective To outperform the Morningstar Australian Multi-Sector Aggressive TR AUD Index over the medium to longer term. This managed portfolio is designed for a growth investor.

Key information

Code NTH0031

Manager name Mercer



Aggressive TR AUD





reinvested




costs1

0.80% pa

Risk band/label 6/ High







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -13.43% -15.50% – – –

Growth2 -14.34% -15.99% – – –

Income2 0.91% 0.49% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -13.43% -15.50% – – –

Benchmark -12.62% -14.44% – – –



$8,600

$8,800

$9,000

$9,200

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600



34.5%

34.8%

6.2%

10.1%

4.3%5.3%

4.9%

Fcoc he


Growth assets 85.5



▪ Property 6.2

▪ Other 10.1




▪ Cash 4.9

Time

MP

Bala

nce (

$A

U)







Australian shares













Alternatives


Defensive

Fixed interest



Cash




Market update






Outlook







Portfolio update


The defensive investments in the portfolio helped to cushion the steep declines recorded in all equity markets. Most notable was the positive return from the Vanguard Australian Fixed Interest Index Fund (3.0%) and the UBS Cash Fund (0.3%). The Pimco Global Bond Fund (-2.1%), while showing a negative return for the quarter, also offset the sharp falls in the equity funds. The recent investment in the Invesco Advantage Global Targeted Returns Fund (-0.5%), funded from a reduction in international shares, played a very positive role diversifying the equity risk in the portfolio.







Investment objective To outperform the Morningstar Australian Multi-Sector Moderate TR AUD Index over the medium to longer term, whilst maintaining low investment costs. This managed portfolio is designed for a conservative investor.

Key information

Code NTH0032

Manager name Mercer



Moderate TR AUD





reinvest




costs1

0.41% pa

Risk band/label 3/ Low to Medium







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -5.41% -5.92% – – –

Growth2 -6.36% -6.40% – – –

Income2 0.94% 0.48% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -5.41% -5.92% – – –

Benchmark -4.27% -4.44% – – –



$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600

$10,800

$11,000

$11,200



12.7%

16.3%

2.3%

25.1%

14.9%

28.7%


Growth assets 31.3



▪ Property 2.3

Other 0.0




▪ Cash 28.7

Time

MP

Bala

nce (

$A

U)



Family Wealth Index Portfolio – 30% Growth Quarterly update for quarter ending 31 March 2020




Australian shares





VAN0005AU Vanguard Emerging Markets Index Fund 3.00



VAN0024AU Vanguard Global Infrastructure Index Fund (Hedged) 3.00

Defensive

Fixed interest


VAN0106AU Vanguard International Credit Securities Indexed Hedged Fund 15.00

Cash




Market update






Outlook







Portfolio update

The 30% Growth Index Portfolio returned -5.92% for the quarter, compared to the benchmark return of -4.44%

The defensive investments in the portfolio helped to cushion the steep declines recorded in all equity markets. Most notable was the positive return from the Vanguard Australian Fixed Interest Index Fund (3.0%) and the UBS Cash Fund (0.3%). The Vanguard International Credit Securities Indexed Hedged Fund (-4.4%), while showing a negative return for the quarter, also offset the sharp falls in the equity funds.

Equity funds which performed relatively well included the Vanguard International Shares Index Fund (-9.0%), which is unhedged and benefitted from the sharp fall in the Australian Dollar over the quarter, and the Vanguard Emerging Markets Index Fund (-13.1%). Australian shares fell sharply. The Vanguard Property Securities Index Fund (-34.3%), the Vanguard Australian Shares Index Fund (-23.4%) contributed to the negative portfolio result.

During the quarter, the cash holdings were reduced to add to Australian and international shares to take advantage of the very sharp declines in share prices that occurred over a very short period.


Investment objective To outperform the Morningstar Australian Multi-Sector Balanced TR AUD Index over the medium to longer term, whilst maintaining low investment costs. This managed portfolio is designed for a moderately conservative risk investor.

Key information

Code NTH0033

Manager name Mercer



Balanced TR AUD




Portfolio income Paid to platform cash account and

reinvested




costs1

0.39% pa

Risk band/label 4/ Medium







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -8.42% -9.38% – – –

Growth2 -9.50% -9.90% – – –

Income2 1.08% 0.52% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -8.42% -9.38% – – –

Benchmark -7.70% -8.45% – – –



$9,000

$9,200

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600

$10,800



21.0%

27.3%

3.1%18.4%

12.2%

18.0%


Growth assets 51.4



▪ Property 3.1

Other 0.0




▪ Cash 18.0

Time

MP

Bala

nce (

$A

U)







Australian shares









Defensive

Fixed interest



Cash




Market update






Outlook







Portfolio update

The 50% Growth Index Portfolio returned -9.38% for the quarter, compared to the benchmark return of -8.45%.





Investment objective To outperform the Morningstar Australian Multi-Sector Growth TR AUD Index over the medium to longer term, whilst maintaining low investment costs. This managed portfolio is designed for a balanced investor.

Key information

Code NTH0034

Manager name Mercer



Growth TR AUD





reinvested




costs1

0.38% pa

Risk band/label 5/ Medium to High







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -10.54% -12.05% – – –

Growth2 -11.71% -12.57% – – –

Income2 1.17% 0.52% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -10.54% -12.05% – – –

Benchmark -10.97% -12.14% – – –



$8,800

$9,000

$9,200

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600



26.7%

38.2%

3.9%

12.1%

5.0%

14.0%


Growth assets 68.8



▪ Property 3.9

Other 0.0




▪ Cash 14.0

Time

MP

Bala

nce (

$A

U)







Australian shares









Defensive

Fixed interest



Cash




Market update






Outlook





Important Information ®Registered trademark of NMMT Limited (ABN 42 058 835 573 AFS License 234653). NMMT Limited (ABN 42 058 835 573, AFSL 234653), which is part of the AMP Group, is the responsible entity of MyNorth Managed Portfolios (ARSN 624 544 136) (Scheme) and issuer of interests in the Scheme. To invest in the Scheme, investors will need to obtain the current Product Disclosure Statement (PDS) which is available at. The PDS contains important information about investing in the Scheme and it is important investors read the PDS before making a decision about whether to acquire, continue to hold or dispose of interests in the Scheme. If a person decides to purchase or vary a financial product, companies within the AMP group will receive fees and other benefits, which will be a dollar amount or a percentage of either the premium they pay or the value of their investments. Contact North Operations on 1800 667 841 for more details. Neither NMMT, nor any other company in the AMP Group guarantees the repayment of capital or the performance of any product or any particular rate of return referred to in this quarterly update. Past performance is not a reliable indicator of future performance. While every care has been taken in the preparation of this document, NMMT makes no representation or warranty as to the accuracy or completeness of any statement in it including without limitation, any forecasts. This quarterly update has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. Investors should, before making any investment decisions, consider the appropriateness of the information in this quarterly update and the PDS, and seek professional advice, having regard to their objectives, financial situation and needs.


Portfolio update





Investment objective To outperform the Morningstar Australian Multi-Sector Aggressive TR AUD Index over the medium to longer term, whilst maintaining low investment costs. This managed portfolio is designed for a growth investor.

Key information

Code NTH0035

Manager name Mercer



Aggressive TR AUD





reinvested




costs1

0.38% pa

Risk band/label 6/ High







Returns Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3 years

% pa

Total return2 -13.81% -15.62% – – –

Growth2 -15.06% -16.16% – – –

Income2 1.25% 0.54% – – –

Performance history


Performance Since 1

Oct 2019

Last 3

months

Last 6

months

Past year

% pa

Past 3

years % pa

Managed

Portfolio2 -13.81% -15.62% – – –

Benchmark -12.62% -14.44% – – –



$8,600

$8,800

$9,000

$9,200

$9,400

$9,600

$9,800

$10,000

$10,200

$10,400

$10,600

$10,800



35.3%

45.5%

4.9%

6.0%2.8%

5.6%


Growth assets 85.7



▪ Property 4.9

Other 0.0




▪ Cash 5.6

Time

MP

Bala

nce (

$A

U)







Australian shares









Defensive

Fixed interest



Cash




Market update






Outlook







Portfolio update






mynorth® managed portfolios family wealth core …...portfolio income paid out to platform cash...

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