by Susan Edmunds
Since July, the Kiwi dollar has fallen from US88c to hover around US77c.
Research house Morningstar’s survey of the retirement savings scheme providers found those with international exposure had been standout performers over the September quarter.
It said the sharp fall in the dollar meant all major stock markets around the world produced positive returns in NZ dollar terms.
The OneAnswer International Share fund produced an 18.5% pa return over the past three years.
NZX-owned Fundsource reported performance in the quarter was correlated with allocation to global equities.
The growth category, with an average 46.5% allocation to global shares, had returns of 3.62% over the quarter, compared to 2.88% for the balanced category, which has just under 30% exposure. Funds with 100% allocation to global equities returned an average 5.8%.
Fundsource’s Sam Stanley said the decision for investors was not as simple as moving their money to a manager who would invest it offshore because different managers would have different levels of hedging. He said this would make a big difference to the funds' performance.
NZX-run Smartkiwi is one of the few that is completely unhedged.
David Boyle, of the Commission for Financial Capability, said if investors could see currency risks being managed, movement in the dollar should not be a reason to change funds. He recommended investors ask their provider what their processes were.
| « Funds get fee warning | Local bias sparks warning » |
Special Offers
No comments yet
Sign In to add your comment
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved