Quarter One



We have moved!


Trust Management has relocated to Level 4, 123 Carlton Gore Road, Newmarket.

The growth of our business over recent years has resulted in the need for more space. We have also taken the opportunity to redesign our offices to reflect new ways of working and embracing new technologies, such as additional video conferencing facilities and improved wifi networking.

The premises on Level 4 allows for further expansion to meet the strong and growing demand for Trust Management's services and expertise.

We look forward to seeing you again soon and showing you through our new premises.


Trust Management receives clean bill of health.

Trust is important to our clients and is at the heart of our business.

To this end, Trust Management engages the professional services firm PWC to carry out independent audits of its processes and internal controls to assure our clients that our systems and internal control procedures are robust and based on best practice.

The outcome of PWC’s most recent audit means our clients can have complete confidence in the way we look after their organisations and manage their financial affairs.

If you would like to know more about the Internal Audit, or would like a copy of the report, please contact Shane Coward, General Manager on 550 4045.

Latest Articles

Below we present two new articles from our educational series, aimed at giving an oversight of key topics using simple terminology, and easy to understand language. These papers are not intended to be the definitive guide on the given topics, but seek to provide enough explanation that readers will be able to understand the overall concepts of each topic.
Rebalancing Considerations
Investors typically expend considerable resources to determine their strategic asset allocation. Unless there is a change in investment objectives, or a fundamental shift in financial markets, it is important that the agreed strategy is maintained.
Measuring Investment Performance

Trustees of charities need to regularly monitor the returns of their investment portfolios. Returns can be measured in different ways and it is important Trustees understand what is being presented to them.

Trust Management News


Fund News

Izone Drive reaches practical completion.

We are pleased to advise that on 20 March 2017 Practical Completion for the building expansion was achieved.  The project was very successful for all involved. 


TWL led the project, while the distribution centre continued to operate.  Safety was a key focus for all parties during the works.  The quality of the existing building has been mirrored in the new build.  The Property Fund undertook some additional structural works in the existing building that sees the entire building meeting 100% of the New Building Standards for seismic, snow and wind loading – this is a significant achievement and a reflection on the quality of the building. 


The building is now one of the largest industrial buildings in the South Island being just under 50,000sqms (5 hectares) on a 10 hectare site – it is truly an impressive property to walk around.


Fund Returns


The Balanced Fund invests in the other five sector funds, maintaining a moderate risk profile with a strategic asset allocation of approximately 35% Fixed Interest, 35% Shares and 30% Property. While not immune to market volatility, the Fund has a strong focus on the distribution of income and its returns tend to be reasonably stable.

​The Fund’s return for the March quarter was 3.2%, to give a return of 9.5% for the March year. Most share markets gained over 5%, buoyed by expectations that the new US administration would usher in new policies that would boost company earnings. Bond returns were more muted but remained positive. Property returned a solid 2.3% for the quarter. The disparity in the returns of the various asset classes highlights the benefit of investing in a well-diversified balanced portfolio.

​The Fund offers a well-diversified portfolio which continues to provide consistent returns in most market conditions. We expect returns in the future to be lower than those of recent years given modest economic growth rates and less favourable monetary policy settings.

To 31 March 2017

Inception Date 01/06/2006


The Fund returned 2.3% in the March quarter, boosted by the revaluation of four properties in the portfolio.

The Warehouse South Island Distribution Centre building expansion in Rolleston was completed during the period. This has been a profitable and well-managed project with a high focus on Health and Safety. The Fund received around $24 million on 19 April as settlement for the sale of 50% of this property, which aligns with the 31 March valuation.

Further to the Fund leasing a substantial portion of the Pumpkin Patch premises to Maori Television Services on a new 15-year term, the Receiver for Pumpkin Patch has continued to occupy 439 East Tamaki Road, paying full rental. It is expected that they will vacate in May. The property is currently being marketed for lease.

The Fund continues to generate solid and consistent returns. There remains a strong emphasis on the regular distribution of income via quarterly distributions.

To 31 March 2017

Inception Date 01/03/2001


The Fund returned 7.0% for the March quarter, compared to the benchmark’s 5.6%, to give a March year return of 10.7% (benchmark 7.2%).

Both the NZ and Australian markets rallied strongly in the period, in line with the world’s major markets. However the performance of individual securities varied widely. For example, the share prices of Fletcher Building and The Warehouse declined around 20% and Sky Television lost 14%.


On the positive side, several stocks that are significantly represented in the Fund generated strong returns. a2 Milk was a standout performer (up 40%) while Fisher and Paykel Healthcare gained 14% and Australian healthcare stock CSL rose 25%.

​The strength of the NZ economy and stable domestic monetary policy settings are expected to provide continued support for growth assets, although returns could become volatile if long-term interest rates rise.

The Fund has an ethical screen in place whereby stocks whose major activities involve alcohol, tobacco, armaments, pornography and gambling are excluded from the portfolio, along with companies involved in the production and/or extraction of fossil fuels.

To 31 March 2017

Inception Date 01/12/2002


The Fund returned 5.8% for the March quarter, to give a March year return of 16.2%. The world’s major share markets extended the rally sparked by President Trump’s election victory in early November. NZ dollar changes over the quarter added a small margin to returns.

​In local currency terms, the US market rose 5.5% over the three months. Other movements of note were Germany’s gain of 7.3% and Japan’s loss of 1.1%, although the latter was compensated by a strong yen. Investor sentiment remained positive amid expectations of higher economic growth and company earnings.   

​Market risks look to be reasonably balanced, but a pause in the recent rally would not surprise. Higher corporate earnings need to be weighed against the likelihood of further monetary policy tightening and higher long-term interest rates. Politics looms as a significant risk factor with imminent elections in France, UK and Germany adding to policy uncertainties in the US. Valuations are reasonable provided that interest rate increases are gradual.

The Fund invests in an indexed product that excludes companies involved in the manufacture of tobacco and controversial weapons. This product tracks the MSCI World ex-Australia Index excluding these sectors of the market. The Fund’s foreign exchange exposures are 50% hedged to NZ dollars.

To 31 March 2017

Inception Date 01/12/2005


The Fund returned 1.4% for the March quarter, in line with the benchmark, to give a calendar year return of 2.3% (benchmark 1.0%).

Long-term yields in the NZ market showed more stability over the three months following their sharp rise in the second half of 2016. The yield on the Government Stock 2027 maturity closed at 3.19%, down slightly from the 3.33% at year-end and compared to a low of 2.12% in August. The relatively flat yields were consistent with more stable yields offshore, notably in the US and Australia.

​The Fund remains defensively positioned with a duration profile around a year shorter than the market benchmark. This strategy significantly tempered capital losses in late 2016.  We continue to believe that long-term yields eventually settle at higher than current levels and offer better investment opportunities in the future.

​The Fund’s strategy prioritises the level and stability of distributed income.

To 31 March 2017

Inception Date 01/09/2005


The Fund returned 0.3% for the quarter, matching the return of the benchmark. For the March year the Fund returned 0.9% (benchmark 1.4%).

Long-term sovereign yields in the major markets were more stable over the three months, following their sharp increases in the second half of 2016, although yields in Europe rose a little. The Fund’s subdued return for the quarter largely reflects the fact that market yields in many countries, notably in Japan and Europe, remain low by any historical comparison.

Low inflation in Europe and Japan and high debt levels in many countries should constrain any rise in yields as will (at least in the short term) the uncertain geopolitical environment. However signs of higher inflation in the US and less accommodating monetary policies around the world are expected to result in long-term interest rates settling at higher levels in the future.   

​The Fund invests in an index fund that tracks the Citigroup Index hedged to Australian dollars. A further hedge is applied to hedge the Australian dollar exposure back to New Zealand dollars. Returns tend to lag the benchmark slightly as the cost of hedging is excluded from the benchmark return calculation.

To 31 March 2017

Inception Date 01/09/2005

Under the Financial Markets Conduct Act this communication may be deemed to be an advertisement for an offer of units. Trust Investments Management Limited is the issuer of the units to be issued under the offer to which this advertisement relates. A product disclosure statement for the offer, which sets out the terms and conditions of the offer, is available, and can be obtained at www.trustmanagement.co.nz/investment-products.