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Find out about our low carbon, local fund - the Ethical Trans-Tasman
Our Ethical Trans-Tasman fund is great for those looking for above average returns that want to invest in local companies that align with our Ethical Investment Policy. Like all our funds, this one is actively managed - investing in our hand-picked companies within Aotearoa and Australia.
From over 2000 listed companies in Australia and Aotearoa our final portfolio is made up of 25-40 stocks. These are companies we have chosen because they align with our three key pillars of respecting people, our planet and animals and fit within our Ethical Investment Policy. We believe they are optimised for ESG risks, financial performance, value, quality of management and business quality. Inspired too by our larger themes such as health planet, healthy living, deglobalisation, decarbonisation and social license.
An example of our respect for the planet is also a key differentiator between this fund and other Trans-Tasman funds: it has a carbon intensity 74% lower than benchmark per dollar of revenue. By carbon intensity we mean greenhouse gas emissions. Adding to this, returns since inception, are well above benchmark - as at 31 July 2024 it has returned 9.5% per annum on average (after fees, before tax). See our Performance and Returns page for the most up to date returns.
What kind of things does this fund invest in?
The diversified fund is invested in a range of sectors including health care, aged care, renewables, utilities and technology (such as datacentres). Aotearoa's market is very concentrated, with the top 10 NZX stocks having 68% of the market share. In Australia the top 20 ASX stocks make up 61% of the market. This means that stock picking has a big impact on returns and actively managing the fund to pick the best companies is key to success.
As ethical investors the first step of constructing any portfolio is excluding activities that we think will cause harm, which is why you won’t find any mining or materials in our portfolio despite this being a featured sector in most Australian funds.
Our top performing stocks in this fund are Infratil, Fisher & Paykel Healthcare and Telix Pharmaceuticals Ltd. We are currently underweight in commercial property as the property sector remains subdued. We are overweight in healthcare stocks as biotechnology stocks have been performing well.
Let’s look at few of the companies this fund invests in:
Infratil has been a stand-out performer among the large New Zealand companies this year and is our top Trans-Tasman holding. Infratil is an infrastructure investment company that actively invests in things that societies need now (for example renewable electricity, data centres and telecommunications networks) and things we’ll need more of in the future (for example diagnostic technology that detects illness early).
PolyNovo is a biotechnology company that develops synthetic-based scaffolding tissue for treatment of patients requiring skin grafts and reconstructive surgery. Successful product development will remove the need for animal products to be used for these surgeries.
Although in the short term PolyNovo products require some animal testing under current law, we regard this as a short-term cost for a significant long-term gain. If successful, Polynovo products will result in much lower future demand for animal sourced surgical products. In addition, we believe Polynovo's synthetic product is also superior to current animal-based alternatives (lower infection and rejection risk). PolyNovo has been granted an Exception by our Ethics and Investment Committee based on the transformational qualities of this particular product.
Find out more in about Pathfinder’s approach to investing with respect for animals.
Interested in investing?
Keen to invest? The Ethical Trans-Tasman Fund is suited to an investor with a mid-high tolerance to risk (meaning you can expect some volatility in the value of your investments over time). It’s recommended investment timeframe is 8+ years. Pathfinder KiwiSaver members can invest in the Ethical Trans-Tasman Fund with a minimum of $2,500. For non-members the minimum investment is $5000. It’s easy to invest online, to find out more visit Managed Funds on our website.
SOURCES:
Toxic ‘forever’ chemicals found in excessive levels in global groundwater, study says | CNN
New Zealand's drinking water safe from harmful ‘forever chemicals’ - The University of Auckland
