Nanuk New World Fund Posts 36% Return on Hedged Units in FY2026

Strong Returns Amid Sustainability Focus

Nanuk New World Fund (ASX:NNU) reported a standout performance for the year ended 30 June 2026, with its currency-hedged unit class delivering a 36.1% total return, outpacing the unhedged units which returned 27.1%. The Fund's strategy centres on a diversified portfolio of global equities aligned with themes of resource scarcity and environmental sustainability, managed by Nanuk Asset Management.

The Fund’s net assets attributable to unit holders rose sharply to AUD 1.08 billion from AUD 830 million a year earlier, reflecting both strong investment gains and net inflows. Total assets under management reached approximately AUD 1.21 billion, underpinned by a portfolio valued at AUD 1.17 billion in listed equities.

Distribution Yield and Unit Movements

Distributions for the year were substantial, with Class A (unhedged) units paying out AUD 88 million (22.65 cents per unit) and Class H (hedged) units distributing AUD 35 million (22.70 cents per unit). While the distribution per unit for Class A dipped from 26.27 cents in 2025, Class H distributions more than doubled, reflecting the Fund’s currency hedging benefits amid volatile foreign exchange markets.

Unit applications and redemptions remained active, with net growth in units outstanding. Class A units increased to 388.5 million from 369.9 million, while Class H units rose significantly to 154.2 million from 97.8 million, indicating growing investor appetite for hedged exposure within the sustainability-themed ETF structure.

Robust Risk Management and Hedging Strategy

The Fund maintains a comprehensive risk management framework addressing market, credit, liquidity, and foreign exchange risks. Notably, the hedged unit class employs forward currency contracts executed by Rochford Capital Pty Ltd to mitigate foreign exchange volatility, effectively reducing currency risk for investors.

Market risk sensitivity analysis showed that a 10% movement in key currencies such as the US dollar, euro, Japanese yen, and Taiwan dollar could materially impact net assets, underscoring the importance of the Fund’s active hedging approach. The Fund’s investments are almost entirely listed equities, valued using observable market prices, with derivative instruments mainly comprising currency forwards.

Governance and Auditor Assurance

Equity Trustees Limited remains the Responsible Entity, with a stable board including Chairman Michael J O’Brien and recently appointed director Russell W Beasley. The Fund continues to be managed by Nanuk Asset Management and custodied by Citigroup.

Ernst & Young issued an unqualified audit opinion, confirming the fair valuation of investments and the adequacy of disclosures. The auditor highlighted investment existence and valuation as a key audit matter, reflecting the Fund’s significant holdings in global equities and currency derivatives.

Accounting Standards and Future Considerations

The Fund is preparing for upcoming changes in accounting standards, including AASB 18, which will alter presentation and disclosure requirements from 2027 onwards. Management is assessing the impact but does not anticipate changes to recognition or measurement of assets and liabilities.

Looking ahead, the Fund emphasises that investment performance is subject to market conditions and that past returns are not predictive of future results. The Responsible Entity retains discretion over unit applications and redemptions to protect liquidity and unit holder interests.