The Aussie dollar ETF returning 46%
As investors seek defensive places to store cash, there is still a disparity in returns for cash funds, according to FE Analytics.
Last week, Money Management wrote a high cash ETF , BetaShares Australian High Interest Cash ETFv, saw the highest level of inflows for Australian ETFs in April 2021 with inflows of $170 million.
According to FE Analytics, there were 28 funds in the enhanced cash sector within the Australian Core Strategies universe and 73 in the Australian dollar cash sector.
The best performer of these funds was the BetaShares Strong Australian Dollar Hedge which returned 46% over one year to 30 April, 2021.
This fund aimed to invest by buying Australian or US dollar exchange-traded futures contracts which were expected to generate a positive return when the Australian dollar strengthened relative to the US dollar.
This was far higher than the second-best performing fund, Smarter Money Higher Income Institutional, which returned 3.9%.
Subsequent returns varied from 3.8% down to losses of 1% for the Perennial EInvest Cash Booster fund.
The RBA Cash Rate Target was 0.1% over the same period while the Bloomberg AusBond Bank Bill, the common benchmark for many cash funds, had returned 0.07%.
Overall, the cash enhanced sector had returned 1.1% while the Australian dollar cash sector had returned 0.8%.
AUTHOR
Laura Dew
Recommended for you
Bennelong Funds Management chief executive John Burke has told Money Management that the firm is seeking to invest in boutiques in two specific asset classes as it identifies gaps in its product range.
Responsible investment performance concerns have lessened as the market hits $1.6 trillion in AUM, according to RIAA’s annual report, but greenwashing fears among asset managers are on the rise.
Research by Morningstar has found fixed income funds are bucking a general trend around managed fund fee dispersion with a smaller fee dispersion compared to equity ones.
As investors seek to diversify their portfolios, the naming of bond labels has broadened out to include green, social and impact bonds, according to the annual RIAA report.
