The Sample Retail Portfolio has been updated for November, with no new additions but returning an attractive return of 5.17%* to the maturity date.
As another month rolls around, the job of the Reserve Bank of Australia (RBA) is becoming trickier, caught between a stronger inflation print and a weaker unemployment rate released the prior month. As expected, the Board kept rates on hold when it met in early November, neither discussing a rate cut or a rate rise. The RBA wasn’t as hawkish as they might have been given the stronger inflation data, and if anything of the view the recent increase is driven by temporary factors.
For one, it makes the rates outlook even more uncertain, with some speculating the rate cutting cycle has come to an end and the next move is higher, although we’re of the view there will be a long and elongated cutting cycle with the potential for another cut at a later stage.
In last month’s update we spoke about the US government in shutdown due to federal budget disagreements, and at time of writing, that shutdown remains in place, although it might end soon as the blockade is starting to have material impacts. With no economic data releases out of the US for about a month now, markets have traded sideways at times for lack of direction.
In terms of new issuance, FIIG participated in its second ASX-listed debt raising as joint lead-manager, this time for Stonepeak. The AUD300m transaction attracted strong demand. We expect further new issues in the mad rush to Christmas, noting the primary market is only available to Wholesale investors.
In the retail space, no new bonds have been added to the product offering, and as such we didn’t make any changes to the portfolio for the month. However, the retail available Clearview Wealth Limited November 2025 callable bond has been redeemed, with funds repaid early this month.
While we didn’t hold this position in the portfolio (we had prior but exited it to reinvest into a longer tenor bond), those retail clients who did will be looking for reinvestment options if they haven’t already done so. Please speak with your Relationship Manager to discuss available retail bonds on offer.
Here we provide an update on the Sample Retail Portfolio for the month of November.
Retail Sample Portfolio
The Sample Retail Portfolio is a balanced portfolio, designed to offer an appropriate level of risk with return. Overall, it remains more skewed towards preserving capital rather than chasing yield.
The portfolio is expected to yield around 5.17%* to maturity for the month, with and has approximately $206k invested.
As mentioned, no new bonds were made retail available over the month and as such there was no catalyst to make changes to the portfolio. Noting the beauty of a bond portfolio is once it’s created it can be left alone with only tweaks along the way. We continue to look to reduce the number of holdings in the portfolio, but only by one or two now (it stands at 16 after holding up to 20).
The prior month both Qantas 2034 and Transurban 2034 senior bonds were made available to retail, however supply has been limited. We would look to add either of these (even both) to the portfolio when there is better availability.
Our NAB 2029 call holding now appears in our portfolio alongside the word ‘franked’, which reflects an update to our FIIG systems to better label bonds that have franking credits attached to the distribution.
There aren’t many in the Over-The-Counter (OTC) market, but this NAB Subordinated 2029 callable note is one of them, and the only one that is retail available. With the regulator phasing out listed bank hybrids, the OTC fixed income market has some alternative options available.
The Sample Retail Portfolio, along with the full list of retail available bonds, can be found on the FIIG Website here. Factsheets are also available via MyFIIG.
*Please note the indicative yield shown is the expected yield to the assumed maturity/call dates of
the bonds included in the portfolio, based on swaps rates at the time of writing.