tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Thursday, April 9th, 6:09PM

News

rss
Latest Headlines

NZ Super Fund: Some coronavirus losses will be recovered, others gone for good

Coronavirus is likely to take the heat out of the global economy, the NZ Super Fund says, but it still expects 2020 to be a less turbulent year than 2019.

Friday, February 21st 2020, 7:17AM

It has released its results for the 2019 calendar year, in which it returned 21.13% and grew to $47 billion.

“We are really pleased with the calendar year result against a backdrop of strong market returns,” chief executive Matt Whineray said.

“It is a strong contribution to the future economic health of our country. At the same time, we know markets are volatile and this coming year presents a range of challenges for investors.”

He said disruptions such as Brexit and the US-China trade war had been suppressed for the time being.

However, unforeseen events, such as the coronavirus outbreak, illustrate how quickly new risks can emerge and upcoming events, such as the outcomes from the US general election and UK-European trade negotiations, could see those former risks resurface.

At the same time, interest rates remain low and asset prices are high, meaning there are fewer attractive investment opportunities available.

“In the short term the fund is taking less active risk and we expect lower returns than we have enjoyed in recent years. Looking further ahead we remain well positioned to exploit emerging opportunities and are exploring a range of potential investments in New Zealand and abroad, particularly in infrastructure and real estate.”

At December 31, the fund had returned 10.32% a year since it was founded and had added $8.9 billion over its passive reference portfolio benchmark.

Two-thirds of the Super Fund is invested in its passive reference portfolio, which returned 22.74% for the 2019 year.

Whineray says the reference portfolio did better than the fund’s actual portfolio largely because of the timing of the fund’s private market asset revaluations, which are assessed less frequently than listed equity holdings.

The NZ Super Fund said efforts to contain the coronavirus outbreak would negatively impact first quarter economic growth, particularly in China, those countries reliant on Chinese spending, and corporates reliant on supply chains through China.

“Some of that growth will be recovered when the outbreak comes under control, but some of it is lost for good. Markets were volatile at the start of the year in response to coronavirus, but have priced in a near-term resolution. However, this could reverse quickly if the impacts prove to be enduring.

“The US and China have recently negotiated a deal that has brought some relief to markets that the trade war at least will not worsen in the near term. At the same time, the lingering damage from the past 18 months of tariff escalation is real and will not reverse quickly. The trade war has had a big impact on global manufacturing activity and countries that are reliant on it.

“Europe was particularly hard hit – it is heavily reliant on manufacturing, has demographic challenges, and has little-to-no room for policy manoeuvre. The outcome of the US presidential election will have the biggest impact on future US-China relationships for the better.”

Tags: NZ Super Fund

« 300 FAP applications – FMA 'not worried'[The Wrap] Regulators need to be wary of AMP Life deal »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 3.55 3.89 3.99
AIA Special - 3.05 3.39 3.69
ANZ 4.44 3.55 3.85 4.49
ANZ Special - 3.05 3.35 3.99
ASB Bank 4.45 3.55 3.89 3.99
ASB Bank Special - 3.05 3.39 3.69
Bluestone 4.44 4.44 4.29 4.34
BNZ - Classic - 3.09 3.35 3.69
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.75 4.10 4.55
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.15 3.15 3.19
Credit Union Auckland 5.95 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union North 6.45 - - -
Credit Union South 5.65 4.75 4.75 -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Lender Flt 1yr 2yr 3yr
Heretaunga Building Society 4.99 4.35 4.45 -
HSBC Premier 4.49 2.95 3.09 3.50
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora ▼4.43 ▼3.55 ▼3.85 ▼4.14
Kiwibank 4.40 3.84 4.14 4.40
Kiwibank - Capped - - - -
Kiwibank - Offset 4.40 - - -
Kiwibank Special - 3.09 3.39 3.65
Liberty 5.69 - - -
Lender Flt 1yr 2yr 3yr
Napier Building Society - - - -
Nelson Building Society 4.95 4.09 4.15 -
Pepper Essential 5.18 - 4.98 4.98
Resimac 4.50 ▼3.49 ▼3.39 3.94
RESIMAC Special - - - -
SBS Bank 4.54 4.85 5.05 5.49
SBS Bank Special - 3.09 3.39 3.69
The Co-operative Bank - Owner Occ 4.40 3.25 3.45 3.69
The Co-operative Bank - Standard 4.40 3.75 3.85 4.19
TSB Bank 5.34 3.89 4.15 4.49
TSB Special 4.54 3.09 3.35 3.69
Lender Flt 1yr 2yr 3yr
Wairarapa Building Society 4.99 3.95 3.99 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - 3.09 3.39 3.69
Median 4.59 3.55 3.85 3.99

Last updated: 8 April 2020 8:55am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com