Capital Group New World (AU) aims to achieve long-term growth of capital by investing in common stocks of companies with significant exposure to countries with developing economies and/or markets. Many of these countries may be referred to as emerging countries or emerging markets. The fund may also invest in debt securities of issuers with exposure to these countries.
Capital Group New World Fund (AU) returned 3.6% before fees and 3.4% net of fees over the quarter, while the index returned 4.0%. For the 12-month period, the fund returned -16.3% before fees and -17.1% net of fees, while the index returned -14.3%.
Areas that helped
• Industrials: Company selection in the sector helped. Holding aircraft manufacturer Airbus helped as shares jumped on signs of recovery in the global travel industry and growing order intake. Third-quarter earnings and revenue beat forecasts, with results buoyed by rising aircraft deliveries and US dollar strength versus the euro.
• Financials: The selection of companies and a low relative position in the sector proved positive relative to the index. In particular, Hong Kong-based insurer AIA was a top contributor to relative returns. Shares rallied on hopes Chinese economic reopening would boost sales as China ended its zero-COVID policy.
• Healthcare: Company selection and a large relative position in the sector helped relative returns. Shares of Novo Nordisk rose after third-quarter earnings topped estimates and the company raised full-year sales growth guidance, pointing to accelerating demand for its diabetes drugs. The biopharmaceutical company also reported strong sales growth for its obesity care segment.
What is Capital Group New World (AU) Capital Group New World (AU) is an Managed Funds investment product that is benchmarked against World Emerging Markets Index and sits inside the Foreign Equity - Emerging Markets Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Capital Group New World (AU) has Assets Under Management of 44.51 M with a management fee of 1.18%, a performance fee of 0.00% and a buy/sell spread fee of 0%.
How has the investment product performed recently?
The recent investment performance of the investment product shows that the Capital Group New World (AU) has returned 1.94% in the last month. The previous three years have returned 2.25% annualised and 10.09% each year since inception, which is when the Capital Group New World (AU) first started.
How is risk measured in this investment product?
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Capital Group New World (AU) first started, the Sharpe ratio is NA with an annualised volatility of 10.09%. The maximum drawdown of the investment product in the last 12 months is -1.84% and -23.34% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
What is the relative performance of the investment product?
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Capital Group New World (AU) has a 12-month excess return when compared to the Foreign Equity - Emerging Markets Index of -0.25% and 2.14% since inception.
Does the investment product produce Alpha over its Peers?
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Capital Group New World (AU) has produced Alpha over the Foreign Equity - Emerging Markets Index of NA% in the last 12 months and NA% since inception.
What are similar investment products?
For a full list of investment products in the Foreign Equity - Emerging Markets Index category, you can click here for the Peer Investment Report.
What level of diversification will Capital Group New World (AU) provide?
Capital Group New World (AU) has a correlation coefficient of 0.85 and a beta of 0.67 when compared to the Foreign Equity - Emerging Markets Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
How do I compare the investment product with its peers?
For a full quantitative report on Capital Group New World (AU) and its peer investments, you can click here for the Peer Investment Report.
How do I compare the Capital Group New World (AU) with the World Emerging Markets Index?
For a full quantitative report on Capital Group New World (AU) compared to the World Emerging Markets Index, you can click here.
Can I sort and compare the Capital Group New World (AU) to do my own analysis?
To sort and compare the Capital Group New World (AU) financial metrics, please refer to the table above.
Has the Capital Group New World (AU) been independently verified by SMSF Mate?
This investment product is in the process of being independently verified by SMSF Mate. Once we have verified the investment product, you will be able to find more information here.
How can I invest in Capital Group New World (AU)?
If you or your self managed super fund would like to invest in the Capital Group New World (AU) please contact Level 18 56 Pitt Street Sydney NSW 2000 Australia via phone 61-2-8038-0800 or via email -.
How do I get in contact with the Capital Group New World (AU)?
If you would like to get in contact with the Capital Group New World (AU) manager, please call 61-2-8038-0800.
Comments from SMSF Mates
SMSF Mate does not receive commissions or kickbacks from the Capital Group New World (AU). All data and commentary for this fund is provided free of charge for our readers general information.
Performance Commentary - September 30, 2022 • For the three months ended 30 September 2022, Capital Group New World Fund (AU) returned 0.6%1 before fees and 0.4%2 net of fees, while the index returned -5.4%.3 For the 12-month period, the fund returned -19.8%1 before fees and -20.7%2 net of fees, while the index returned -19.2%.
3 Areas that helped over Q3 2022:
• Consumer discretionary: The selection of stocks and, to a lesser extent, a low relative position in the sector proved positive relative to the index. Low relative exposure to China-based Alibaba helped, as shares fell 30% over the quarter. Although the e-commerce giant reported better-than-expected earnings, revenues remained flat due to slow growth, particularly in the company’s cloud computing segment.
• Information technology: Stock selection in the sector helped. In particular, shares of Wolfspeed – which develops and manufactures semiconductors -surged on the back of strong financial results and as the stock returned to favour after a disappointing first half. Wolfspeed’s fiscal fourth-quarter earnings beat estimates, driven by strong sales momentum and improved manufacturing execution for power devices.
• Communication services: Select exposure to companies in the sector helped relative returns. A low relative position in China-based provider of internet and mobile value-added services Tencent was positive. Shares sold off after Tencent was sanctioned by China’s State Administration for Market Regulation for the way it had previously reported acquisitions.
Performance Commentary - June 30, 2022 For the three months ended 30 June2022, Capital Group New WorldFund (AU) returned-8.2%1 before fees and -8.5%2 net of fees, whilethe index returned-3.3%. 3 For the 12-month period, the fund returned -20.8%1 before fees and -21.8%2 net of fees, while the index returned -18.4%.
Areas that helped over Q2 2022:
• Consumer staples: The selection of stocks in the sector proved positive relative to the index. Kweichow Moutai Co., Ltd – one of the world’s largest distillers and produces of Moutai, a rice-based liquor –was a large contributor to relative returns as shares gained 19%. The stock benefited from robust first-quarter results and upbeat guidance as well as its status as a defensive play, with its strong pricing power and high earnings visibility appearing particularly attractive at a time when China’s economyhas generally been experiencing economic weakness.
• Financials: A low relative position in the sector helped. Holding AIA supported relative returns. Shares held up better than the wider market, supported by hopes for an improvement in revenue over the second quarter after coronavirus disruption in China weighed on sales in the first three months of the year.
• Korea: Select exposure in Korea-domiciled companies helped relative returns. A low relative position in Samsung was positive. It was reported that the world’s leading smartphone maker is planning to reduce production by 30 million units for 2022.
Performance Commentary - March 31, 2022 • For the three months ended 31 March 2022, Capital Group New WorldFund (AU) returned-12.5% before fees and -12.7% net of fees, while the index returned-9.9%. For the 12-month period, the fund returned -4.3%1 before fees and -5.4% net of fees, while the index returned -10.1%.
• Financials
The selection of stocks and a low relative position in the sector hurt relative returns. Investments in European banks such as Société Générale and Unicreditweighed on results due to concerns of recession in Europe as a consequence of Russia’s invasion of Ukraine. These banks also had some loan exposure to Russia.
• Energy
The selection of stocks in the sector proved positive relative to the index. In particular, a low relative position in Gazprom helped. Shares slid sharply after Russia invaded Ukraine causing many countries to impose severe sanctions against Russia. The portfolio’s position in Gazprom was fair valued at close to zero at the end of the quarter.
Performance Commentary - September 30, 2021 For the three months ended 30 September 2021, Capital Group New World Fund (AU) returned -0.7%1 before fees and -1.0%2 net of fees, while the index returned -4.5%. 3 For the 12-month period, the fund returned 25.8%1 before fees and 24.3%2 net of fees, while the index returned 17.3%.
After a strong rebound from COVID-19, the global economy appears to be slowing and inflation is rising. Growth is being challenged by supply-chain imbalances, rising energy prices and disruptions in industrial activity that is causing shortages for finished goods. • Uncertainty about the direction of China’s economy, in part due to tightening regulatory measures and deleveraging in the country’s property sector, could further weigh on growth. Meanwhile, fiscal and monetary policies from governments and central banks in the developed world might diverge as countries seek to recover from the pandemic.
Performance Commentary - June 30, 2021 For the three months ended 30 June 2021, Capital Group New World Fund (AU) returned 11.0%1 before fees and 10.7%2 net of fees, while the index returned 6.6%. 3 For the 12-month period, the fund returned 32.0%1 before fees and 30.5%2 net of fees, while the index returned 29.2%.
Performance Commentary - April 30, 2021 For the month ended 30 April 2021, Capital Group New World Fund (AU) returned 3.1% before fees and 3.0% net of fees, while the index returned 1.1%3. For the 12-month period, the fund returned 31.3%1 before fees and 29.7%2 net of fees, compared to the index’s return of 26.0%.
• Stock selection in, and, to a lesser extent, a relatively light exposure to, the consumer discretionary sector contributed to relative returns. Notably, a holding in Sweden-based Evolution Gaming Group helped relative results as the online-gambling business is supporting an increasing number of online casinos around the world and continues to generate strong profit margins.
Performance Commentary - December 31, 2020 For the three months ended 31 December 2020, Capital Group New World Fund (AU) returned 11.5%1 before fees and 11.2%2 net of fees, while the index returned 11.2%. For the 12-month period, the fund returned 14.6%1 before fees and 13.3%2 net of fees, while the index returned 7.8%. The selection of stocks and a low relative position in the consumer discretionary sector proved positive.
Relatively low exposure to Alibaba Group helped, as shares declined 21%. Shares came under pressure from tightening regulation and the forced suspension of the planned initial public offering for Alibaba’s online banking service, Ant Group. Alibaba was compelled to shelve the IPO as Beijing reconsidered the wider role of fintechs in its financial system. Alibaba’s stock was additionally hampered after the Chinese authorities unveiled new rules to curb monopolistic practices in the domestic internet industry. Stock selection in and, to a lesser extent, a relatively low exposure to, the communication services sector also contributed to relative returns.
A relatively light exposure to China-based internet-services conglomerate Tencent Holdings was beneficial as the company’s shares lagged the broader market’s strength despite reporting better-than-expected third-quarter earnings. Investors were concerned about the impact of new antitrust regulations in China. Stock selection in the information technology sector proved negative. Relatively low exposure to Samsung Electronics hurt. The maker of memory chips and electronics reported a strong quarterly profit, the result of emergency chip orders from Huawei and broader demand from China. The company’s operating margin increased substantially as it benefitted from an improved product mix. Encouraging news on COVID-19 vaccines raised hopes that demand across the smartphone market could accelerate in 2021, while accelerating uptake of 5G technology could help demand for semiconductors. Stock selection in, and a relatively high exposure to, the health care sector detracted from relative returns.
A position in AstraZeneca detracted as its shares fell amid worries that regulatory approval for its COVID-19 vaccine could be delayed owing to controversy over clinical trial results and concerns that it was overpaying to acquire rare diseases and immunology specialist Alexion Pharmaceuticals in a US$39 billion deal. However, at the end of December, the UK medicines regulator approved the AstraZeneca-Oxford vaccine.
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