Morningstar rates ING and AMP as investment grade

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Morningstar has released further reviews of the New Zealand share strategies used by locally based fund managers.

Tuesday, May 6th 2008, 7:03AM

Morningstar gives ING's New Zealand Share strategy an investment grade rating. It says the fund 'offers a suitable means to achieve domestic equities exposure, although we think there are better options available."

It says the key person issues identified previously have been overcome with Mark Brown stepping into portfolio management duties, and the arrival of Senior Investment Analyst Craig Brown.

A criticism is that it may take some time for companies, identified by ING to get included in the portfolio, therefore "which creates the potential to miss the boat on some stocks."

On a performance basis the New Zealand Share Fund's has been able to make solid gains during bull markets, but tends to struggle when markets fall, Morningstar says.

The research house says AMP's Strategic New Zealand Shares strategy "is a more than competent offering, but better choices are available to investors."

This too is given an investment grade rating.

It says performance improved in the past two years after Head of Equities Guy Elliffe overhauled the approach and brought in more resources.

Morningstar says the strategy hasn't held up as well in the recent market downturn as some of AMP's peers.

"We'd therefore like to get greater confidence in this team's ability to manage the portfolio effectively through a full market cycle before giving wholehearted endorsement."

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