Dividend Yield Fund

Overview and Investment Objective

Date: Wed, Sep 20, 2017  |   Price:   1.3947

In 2007, JMIS Limited established a 100% owned funds management subsidiary which is now called Clarity Funds Management Limited and offers six investment funds.  The investment management expertise of the JMIS team is also used to manage funds offered to our clients through Clarity.
Clarity has the ability to appoint external investment managers or advisers.

The objective of the Clarity Dividend Yield Fund, previously known as the JMIS Equity Income Fund, is to achieve returns over the medium term (for at least a period of five years) by investing in a well-diversified portfolio of primarily New Zealand and Australian equities with an income bias (selected on a basis to favour those shares with higher earnings and dividend yields).  The Fund will provide investors with a regular income stream.   It may also invest in other assets on listed sharemarkets, fixed interest securities and cash.

The focus is to generate a return that exceeds the benchmark index. We use a 75:25 benchmark index to measure relative performance.  That is 75% of the NZX50 Portfolio Index and 25% of the ASX200 Accumulation Index in Australian dollars.  We compare actual performance (net of fees and expenses) with index performance to gauge value added by our investment selections. 

This Fund may be suitable for investors seeking a regular income from their diversified investment, with exposure across Australasian equities, who are comfortable with medium to high risk in the short-term.

The aim of low volatility will be achieved through a diversified portfolio of holdings (generally each holding will be less than 7% (maximum 10%) of the total portfolio). The Clarity Dividend Yield Fund will typically hold 30-60 securities which will return regular dividend and/or interest payments to the Fund.  

The target asset allocation ranges shown below are the expected average asset mix of the Fund over the long term.  Clarity will manage the Fund within the following given ranges.

Asset Sector Target
Asset
Allocation %
Range %

Cash and cash equivalents

   Including short-term securities and deposits

5 0 - 30

New Zealand Equities

   Any company listed on the NZX Stock Exchange

60 0 - 80

Australian Equities

   Any company listed on the Australian Stock Exchange

10 0 - 50

International Equities

   Any company listed on any other recognised Stock Exchange

0 0 - 5

Listed Property

   Any property company listed on the NZX Stock Exchange or Australian Stock Exchange

20 0 - 40

New Zealand Fixed Interest

   Including NZ Government, local authority, corporate and non-government securities

5 0 - 10

International Fixed Interest

   International bonds including government, local authority, corporate and non-government securities rated investment grade

0 0 - 10

Other Assets

   Via exchange traded fund(s) (ETF) and currency hedging

   An ETF is a marketable security that tracks published market indices

0 0 - 10
  100  

When we invest in international assets denominated in foreign currencies, we generally enter into foreign exchange contracts to reduce or increase the Fund’s exposure to the New Zealand dollar. 

We intend to make distributions from the Clarity Dividend Yield Fund broadly in line with the income generated by the investment portfolio. The distributions will be paid quarterly. Investors will have the option to reinvest their distributions into additional units.

Clarity Funds Management Limited is the issuer and manager of the Clarity Dividend Yield Fund.  We work together with Public Trust, our Supervisor, to act in the best interest of investors.

Clarity Dividend Yield Fund application money and investments are held by the Supervisor or their appointed custodian. The Fund has an independent registrar and an administrator who sets the daily price.  The Fund is audited annually.

The Clarity Dividend Yield Fund is governed by the Trust Deed dated 5 September 2016 and the Establishment Deed dated 29 October 2013. The Fund is established within a registered managed investment scheme under the Financial Markets Conduct Act 2013 (FMC Act), scheme number SCH10600 (Scheme). The operation of the Scheme is governed by the FMC Act.

You can download a copy of the Product Disclosure Statement and Fund Update below for more detailed information about the Clarity Dividend Yield Fund and for the Fund application.

You can review a copy of the Trust Deed, Product Disclosure Statement and other important Scheme documents at any time by either contacting us or electronically on the Scheme's register on www.business.govt.nz/disclose.

Quarterly Fund Update  |   Quarterly Fund Commentary   |   Product Disclosure Statement  |  Other Material Information  |    Application Form  |  Annual Report | 

 

Quarterly Fund Commentary

With interest rates and inflationary expectations on the rise, it is likely that the bull market in bonds is now over. Therefore, rising interest rates in 2017 may well provide a headwind for share valuations. Janet Yellen is promising 2 or 3 more rate increases in the US for 2017. The Trump victory may lead to more spending and greater deficits too.

Fund Commentary PDF


Quarterly Fund Update

This update provides you with information about the Fund including its performance and investment mix.

Quarterly Fund Update