The launch of a new fund taking on the $250 billion NZ bank deposit market moved closer last week after Wedge lodged formal disclosure documents.
As reported in April, the manager founded by former Fisher Funds fixed income head, David McLeish, plans to attract lazy bank account and term deposit money into a novel investment vehicle investing in cash and fixed income securities.
McLeish said Wedge would aim to offer investors a daily return (paid monthly), published every morning, “decently” above the official cash rate.
As per the just-released statement of investment objective and policies (SIPO), the Wedge Savings Fund will allocate to two underlying wholesale funds across flexible ranges.
Wedge has set the ‘neutral’ split between the Fortress and Summit funds at a respective 70 per cent and 25 per cent (with the remaining 5 per cent in cash). However, the manager can hold up to 100 per cent in Fortress and a maximum of 50 per cent in Summit.
The overall Wedge neutral asset allocation leans 65 per cent to cash (or equivalents) and 35 per cent in fixed income securities.
McLeish said last month Wedge would invest into a broad range of fixed income securities in NZ, Australia, Canada, western Europe, US and the UK.
“Wedge is an active cash and fixed income investment manager which conducts its own proprietary market analysis and detailed fundamental research to help it select investments for the Underlying Funds into which the Scheme invests,” the SIPO says.
McLeish works alongside his brother, Andrew, at Wedge as well as ex Fisher colleagues Lyle McNee and Angela Quirk.
Meanwhile last week, SBS Wealth piled into the higher-risk option KiwiSaver trend with the release of the new Focused Growth Fund.
As reported earlier this month, Generate (which, coincidentally, offers a Focused Growth fund) also released a new higher-growth investment option following a chain of up-risk product roll-outs from managers including ASB, ANZ, Kōura, Pathfinder, Pie Funds, QuayStreet, Simplicity and Westpac.
The SBS KiwiSaver (previously known as Lifestages) already has a long-established High Growth vehicle with a target 98 per cent allocation to equities (74 per cent in global shares and 24 per cent in Australasian stocks).
However, the SBS Focused Growth Fund ups the ante further by aiming for a 98 per cent exposure to international equities.
“The Fund will invest in a concentrated selection of international equites and global themes (up to 25 securities), either directly or indirectly via an underlying fund, with a small amount held in cash,” the SBS disclosure material says.
SBS KiwiSaver uses a range of underlying managers for various asset classes including Dimensional Fund Advisors, BlackRock iShares exchange-traded funds, Harbour Asset Management, Kernel and Schroders.
The $680 million SBS KiwiSaver scheme has also established a new stand-alone cash fund.