Janus Henderson Conservative Fixed Interest seeks to achieve a total return before fees that exceeds the total return of the benchmark by 0.5% p.a., over rolling three-year periods. The fund invests substantially all of its assets in the underlying fund and may also hold cash. Under normal circumstances, the underlying fund will invest in a portfolio of cash, fixed and floating interest rate securities including bank securities, asset backed securities and corporate securities.
The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.35% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.01% (gross) in September. The Fund continues its outperformance, beating the Benchmark over the longer term including by 1.22% (gross) over the year, and 0.68% (gross) since inception per annum.
Australian credit performed positively in September, buoyed by the embedded elevated yields while spreads were broadly unchanged. We remain cautious and selective on credit, buying in the industries we like such as inflation protected industries, senior bank paper, and high quality well collateralised Asset Backed Security (ABS) structures.
Returns from both money market rates and high quality credit continued to deliver good results for investors. Income generation remains strong and local Australian high grade credit continues to add value with credit spreads rallying over the quarter, having now moved from being cheap to being closer to fair. During September, ongoing supply from domestic and offshore banks modestly softened credit spreads with the floating rate credit market still outperforming bank bills, mainly from the additional income.
We have remained patient and positioned neutral versus the Benchmark on interest rate duration to navigate the ongoing volatility in the yield environment. As the tightening cycle reaches a mature phase, we are biased to lock in some of the yield levels via adding duration to the portfolio at attractive yields as we see value emerging versus our view of fair value. During September we left duration unchanged while we await more extreme yield overshoots as an opportunity to move overweight duration.
What is Janus Henderson Cnsrv Fxd Intst Janus Henderson Cnsrv Fxd Intst is an Managed Funds investment product that is benchmarked against Australian Bond Bank 0+Y Index and sits inside the Fixed Income - Australian Short Term Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Janus Henderson Cnsrv Fxd Intst has Assets Under Management of 58.62 M with a management fee of 0.35%, a performance fee of 0.00% and a buy/sell spread fee of 0.02%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the Janus Henderson Cnsrv Fxd Intst has returned 0.51% in the last month. The previous three years have returned 1.7% annualised and 0.88% each year since inception, which is when the Janus Henderson Cnsrv Fxd Intst first started.
How is risk measured in this investment product?
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Janus Henderson Cnsrv Fxd Intst first started, the Sharpe ratio is 0.61 with an annualised volatility of 0.88%. The maximum drawdown of the investment product in the last 12 months is 0% and -1.34% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
What is the relative performance of the investment product?
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Janus Henderson Cnsrv Fxd Intst has a 12-month excess return when compared to the Fixed Income - Australian Short Term Index of -0.2% and -0.02% since inception.
Does the investment product produce Alpha over its Peers?
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Janus Henderson Cnsrv Fxd Intst has produced Alpha over the Fixed Income - Australian Short Term Index of 0.03% in the last 12 months and -0.01% since inception.
What are similar investment products?
For a full list of investment products in the Fixed Income - Australian Short Term Index category, you can click here for the Peer Investment Report.
What level of diversification will Janus Henderson Cnsrv Fxd Intst provide?
Janus Henderson Cnsrv Fxd Intst has a correlation coefficient of 0.84 and a beta of 0.45 when compared to the Fixed Income - Australian Short Term Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
How do I compare the investment product with its peers?
For a full quantitative report on Janus Henderson Cnsrv Fxd Intst and its peer investments, you can click here for the Peer Investment Report.
How do I compare the Janus Henderson Cnsrv Fxd Intst with the Australian Bond Bank 0+Y Index?
For a full quantitative report on Janus Henderson Cnsrv Fxd Intst compared to the Australian Bond Bank 0+Y Index, you can click here.
Can I sort and compare the Janus Henderson Cnsrv Fxd Intst to do my own analysis?
To sort and compare the Janus Henderson Cnsrv Fxd Intst financial metrics, please refer to the table above.
Has the Janus Henderson Cnsrv Fxd Intst been independently verified by SMSF Mate?
This investment product is in the process of being independently verified by SMSF Mate. Once we have verified the investment product, you will be able to find more information here.
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Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the Janus Henderson Cnsrv Fxd Intst. All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - August 31, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.51% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.14% (gross) in August. The Fund continues its outperformance, beating the Benchmark over the longer term including by 1.14% (gross) over the year, and 0.68% (gross) since inception per annum.
Credit performed well in August, buoyed by the embedded elevated yields which offset some spread widening. We took profit on some of the credit in the portfolio, whilst maintaining high quality credit positions that we are comfortable with.
Returns from both money market rates and high quality credit continued to deliver good results for investors. Income generation remains strong and local Australian high grade credit continues to add value this year with credit spreads rallying further.
We have remained patient and neutral on duration to navigate the ongoing volatility in the yield environment, but as the tightening cycle reaches a mature phase, we are biased to lock in some of the yield levels via adding duration to the portfolio at attractive yields. During August we added a modest amount of duration as bond yields hit new highs mid-month.
Performance Commentary - July 31, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.49% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.12% (gross) in July. The Fund continues its outperformance, beating the Benchmark over the longer term including by 1.13% (gross) over the year, and 0.68% (gross) since inception per annum. It was a good month of outperformance from credit, returns benefitting from both additional income and some spread tightening. Overweight credit allocations were a positive contributor as a result.
Returns from both money market rates and high quality credit continued to perform well. Ongoing healthy levels of income as well as a modest positive contribution from credit spreads added value.
We have remained patient and neutral on duration to navigate the ongoing volatility in the yield environment, but as the tightening cycle reaches a mature phase, we are biased to lock in some of the yield levels via adding duration to the portfolio at attractive yields.
Performance Commentary - June 30, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.41% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.11% (gross) in June. The Fund continues its outperformance, beating the Benchmark over the longer term including by 0.81% (net) over the year, and 0.21% (net) since inception per annum.
It was a good month of outperformance from credit, returns benefitting from both additional income and some spread tightening. Overweight credit allocations were a positive contributor as a result, and we continued to actively take profit on active positions added during FY23 that have moved from cheap back towards fairer valuations.
Portfolio returns benefited from healthy levels of income from money market rates and high grade credit spreads, a further positive contribution from tighter credit spreads also added value. We remained neutral interest rate duration, which protected capital during June, and favoured adding yield via shorter dated commercial paper with margins of 0.2-0.5% above bank bills. To navigate the volatile yield environment, we remain patient looking for potential yield overshoots to lock in higher levels of income.
Yield on the portfolio has risen as the market has removed near term cuts from the RBA cash profile. In the calmer market environment we took some profit on the credit spread rally year to date and have replenished liquidity.
Performance Commentary - May 31, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.36% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.07% (gross) in May. The Fund continues its outperformance, beating the Benchmark over the longer term including by 0.76% (gross) over the year, and 0.67% (gross) since inception per annum exceeding the fund objective.
Overweight credit allocations were a positive contributor, benefiting during the month mainly from additional income and constructive spread movements. Returns were healthy and fairly stable in the money market and quality end of the floating rate credit market despite offshore noise. The portfolio benefited from healthy levels of income return as money market rates hover around 4%, as well as additional yield contribution from high grade credit spreads. We used the rise in bond yields to move from modestly underweight interest rate duration to neutral as market pricing more closely reflects our view of fair value. Yield on the portfolio has risen as the market has removed near term cuts from the RBA cash profile. In the calmer market environment we took some profit on the credit spread rally year to date and have replenished liquidity.
Performance Commentary - April 30, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.42% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.12% (gross) in April. The Fund continues its outperformance, beating the Benchmark over the longer term including by 0.54% (gross) over the year, and 0.67% (gross) since inception per annum. April was a good month for credit, with most of the attribution coming from higher coupon income as credit spreads stabilised.
The Fund added additional alpha by taking advantage of opportunities that arose after the Silicon Valley Bank collapse and Credit Suisse merger. Some of the safest segments from a default risk perspective cheapened as the baby was thrown out with the bath water. These rebounded well in April as rationality prevailed. We took the opportunity to take some profit on those trades that had rallied/rolled down. We remain cautious on the corporate debt sector whilst harnessing the income from taking larger positions in the highest quality credit segments. We remain under invested in higher beta securities with powder dry for future acquisition.
Monthly returns for the strategy resumed their calendar year outperformance. Despite a pause from the RBA, income returns on floating rate credit as well as money market securities remain healthy and were the main driver of returns and outperformance. Credit spreads also tightened modestly by 2-3bps on senior bank notes which recovered some of the softness seen in March. We retained a neutral to modest underweight stance on duration given the lack of pricing of further rate rises by the market which is contrary to our view of fair value.
Performance Commentary - March 31, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.16% (gross). The Fund underperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by -0.12% (gross) in March.
Credit spreads weakened over the month, which was a detractor to performance. Generous coupon income helped to preserve capital in what was a challenging month for physical credit. Floating rate credit outperformed fixed rate as investors shifted out of fixed rate bonds and into floating rate notes following the rally in bond yields. Fixed rate bank and corporate credit, including Tier 2 debt, underperformed government bond equivalents.
This year has seen healthier returns for the Fund’s investors, benefiting from higher availability of monthly yield income. Despite a negative contribution from high grade credit allocations in March, the Fund’s weighting towards high quality investment grade credit and selective Tier 2 securities have outperformed, delivering positive excess returns year to date. We retained a neutral stance on duration given the significant swings in bond returns, over the past four months in particular.
Performance Commentary - February 28, 2023 The Janus Henderson Conservative Fixed Interest Fund (Fund) returned 0.47% (gross). The Fund outperformed the Bloomberg AusBond Bank Bill Index (Benchmark) by 0.24% (gross) in February, which returned 0.23% on the month. Globally, credit spreads weakened over the month, with Australia outperforming with local spreads 5 basis points (bps) tighter despite strong supply. Generous coupon income also helped buoy performance in the month. Floating rate credit outperformed fixed rate notes given the rise in bond yields. Active allocations to Tier 2 debt were a strong driver of returns as these assets significantly outperformed. We have favoured generating excess return by having larger positions in high quality assets with greater liquidity, complemented with sub-sectors like Tier 2, where attractive value has been on offer. The new year has seen two strong months for excess returns, with the higher income available from cash yields and active credit selection complemented by capital gains on high quality credit spreads. Selective rotation in subsectors of credit enhanced returns, especially the portfolio’s weighting towards high quality investment grade credit and selective Tier 2 securities which have materially outperformed.
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