FIIG Conservative Retail Model Portfolio
02 April 2015
The FIIG Conservative Retail Model Portfolio is an example of how a diversified bond portfolio can provide Retail investors with
strong cashflows and superior returns. This provides Retail investors with the ability to invest in direct fixed income from
$50,000.
Key metrics/statistics
Portfolio Return Statistics
Capital Structure Exposure
Yield To Maturity
3.68%
Senior Debt
82%
Running Yield
4.72%
Subordinated Debt
18%
Portfolio holdings
Sector
Allocation
Coupon
Type
Maturity/
Call Date
Running
Yield
Gross
YTM
Price
National Wealth
Management Holding Ltd
Wealth
Management
20%
Floating
16/06/2016*
2.97%
3.28%
99.188
DBCT Finance Pty Ltd
(Dalrymple Bay Coal
Terminal)
Coal
Infrastructure
20%
Fixed
09/06/2016
6.05%
3.29%
103.363
Downer Group Finance
Pty Ltd
Infrastructure
20%
Fixed
29/11/2018
5.34%
3.49 %
107.642
Southern Cross Airports
Corporation Pty Ltd
(Sydney Airport)
Transport
20%
Inflation
Linked (CIB)^
20/11/2020
3.48%
4.70%
144.089
JEM (Southbank) Pty Ltd
Government
Infrastructure
20%
Fixed
28/06/2018*
6.05%
3.25%
110.268
Issuer
*Callable: calculations assume called at first opportunity
^Yield for inflation linked bonds (ILB) equals real yield plus a current inflation assumption of 2.5%. Capital indexed bonds (CIB) running yield quoted as a commencing value, given
current indexation, but will accrete up with inflation
Bonds may be changed subject to supply – see substitute list below
To view the selection criteria for the model portfolio visit https://www.fiig.com.au/docs/modelportfolios/conservativer
Key highlights
1. An approach that protects capital, the Conservative Retail Portfolio provides regular and reliable income; ensuring investors
can have peace of mind.
#
2. The Conservative Retail Portfolio provides superior returns when compared to term deposits, with a yield to maturity of
3.68% plus the added benefit of liquidity.
3. With a mix of fixed, floating and inflation linked cashflows; the Conservative Portfolio has been selected to perform in
any environment and provides significant protection against inflation.
© 2015 FIIG Securities Limited
|
ABN 68 085 661 632
|
AFS Licence No. 224659
www.fiig.com.au
|
1800 01 01 81
Issuer
Commentary
National Wealth
Management Holdings
Ltd
National Wealth Management Holding (NWMH) is a wholly owned subsidiary of National Australia Bank (NAB). It
is effectively a holding company for the bank’s wealth management arm, MLC. NWMH has a very strong position
in the Australian wealth management and life insurance industries. Following recent acquisitions, Aviva and
JBWere, the group cemented its position in the sector with leading market share in the investment, super and
individual risk sectors.
DBCT Finance Pty Ltd
(Dalrymple Bay Coal
Terminal)
Dalrymple Bay Coal Terminal is currently the third-largest bulk export-coal terminal in the world, critical to the coal
supply chain in Queensland’s Bowen Basin region. Predictable and stable cash flow through take-or-pay contracts
with well-established coal companies. Current regulatory decision covers the 2016 maturing bonds. Recent
refinancing adds confidence that this issuer enjoys the favour of investors.
Downer Group
Finance Pty Ltd
Downer EDI Limited (Downer) is an ASX listed engineering and services firm providing engineering solutions
across a number of sectors to clients throughout the Asia-Pacific region.
Southern Cross Airport
Corporation Pty Ltd
(Sydney Airport)
Sydney Airport is a very solid infrastructure asset. With Macquarie no longer the driver of the model, it has seen
some finance restructuring towards a more traditional infrastructure model. Recent refinances show Sydney
Airport continues to hold favour with institutional investors. Though doubtful, even if there is a second airport in
Sydney by 2030, it is because there are too many flights, which we see as a good thing.
JEM (Southbank) Pty
Ltd
JEM (Southbank) is a wholly owned finance vehicle of Axiom Education Queensland Pty Ltd (Axiom). The AMP
majority owned Axiom is the special purpose finance vehicle that operates the Southbank Education and Training
Precinct for the State Government of Queensland under a private public partnership. The contract continues
through to 2039 at which time the facilities will revert back to State control.
#The subordinated debt securities are priced assuming they will be called at first opportunity. While this is expected, there is potential for these securities not be called and
maturity extended by up to ten years in the case of the subordinated debt. If not called, the price of those securities would likely fall along with the forecast running yield and yield
to maturity percentages.
Key portfolio characteristics
About FIIG
1. A diversified portfolio with a high weighting to strong, local
companies reducing “international” risk.
#
2. Solid return with a yield to maturity 3.68%.
3. Regular and reliable cashflows with a mix of fixed rate,
floating rate and inflation linked interest payments.
4. Majority of the portfolio is made up of senior/senior secured
bonds, placed high in the capital structure (senior debt
accounts for 60% of the portfolio).
5. Available to retail investors with no ongoing fees or charges.
FIIG Securities are fixed income experts, providing
investors with a single focus on fixed interest investments.
FIIG provide individuals and their advisors with choice and
control through innovative services, featuring direct access
to a broad range of bonds and deposits.
FIIG’s services reach beyond brokering your fixed income
trade requirements. Our investor support services include
extensive news and research articles produced by our inhouse Research Team, along with investor reporting
facilities and online access to a range of tools and services,
including portfolio management and Rolling Term Deposits.
For further information about FIIG’s services or this model
portfolio, contact FIIG’s Intermediary Advisor Team on
1300 752 663.
FIIG Securities Limited (‘FIIG’) provides general financial product advice only. As a result, this document, and any information or advice, has been provided by FIIG without taking account of
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© 2015 FIIG Securities Limited
|
ABN 68 085 661 632
|
AFS Licence No. 224659
www.fiig.com.au
|
1800 01 01 81