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NZ market a better performer in slump: Morningstar

While growth funds took a hammering in the first quarter of this year, the category is still the best performer over the longer term, Morningstar’s latest KiwiSaver survey shows.

Thursday, April 30th 2020, 9:00PM

The survey for the March quarter noted that the S&P/NZX 50 Index was down 14.8% over that period.

“While any drawdown is never ideal, New Zealand was one of the best performing markets in the world over this period, helping KiwiSaver investors achieve better outcomes than might have been the case with similar schemes in other countries.”

Some of the best performing KiwiSaver funds in the quarter were FANZ Lifestages KiwiSaver Income – up 0.6%, JUNO KiwiSaver Conservative -1.4%, JUNO KiwiSaver Balanced -3.1%, JUNO KiwiSaver Growth -7%, and Booster KiwiSaver SRI Growth -9.7%.

Average category returns ranged from a 2.2% loss for conservative funds to a 14.5% loss for aggressive funds.

“Over the quarter, the JUNO KiwiSaver options benefited from their large active cash positions relative to both category peers and their own target asset allocation, providing downside protection as equity markets fell. This reverses the relative positioning for their conservative and balanced options compared to 2019, where their conservative positioning caused them to lag most peers during that strongly performing period,” the survey noted.

On an annual basis, the conservative category was up 2.2% for the year while aggressive funds were down 4.5%.

But on a 10-year basis, the growth category average was a return of 8%, compared to 6.75% for balanced, 6.72% for aggressive and 5.5% for conservative.

Average annual returns for multisector options ranged from 2.2% down to -4.5%. The conservative category average recorded 2.2% for the year, followed by moderate (0.3%), balanced (-1.5%), growth (-3.2%), and aggressive (-4.5%).

“It is most appropriate to evaluate performance of a KiwiSaver scheme by studying its long-term returns,” Morningstar said.

“Over 10 years, the growth category average has given investors an annualised return of 8.0%, followed by balanced (6.75%), aggressive (6.72%), moderate (5.8%), and conservative (5.5%).”

ANZ, ASB and Westpac are the top three KiwiSaver providers by volume, respectively.

Tags: KiwiSaver Morningstar

« Advisers helping clients do better: AMPLevel the KiwiSaver default playing field »

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AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.09 3.25 3.39
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ASB Bank 4.45 2.49 2.59 2.65
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BNZ - Classic - 2.49 2.69 2.79
BNZ - Mortgage One 5.15 - - -
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BNZ - Std, FlyBuys 4.55 3.09 3.29 3.39
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China Construction Bank Special - 2.65 2.65 2.80
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Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
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Heartland Bank - Online 2.50 1.99 2.35 2.45
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HSBC Premier 4.49 2.25 2.35 2.65
HSBC Premier LVR > 80% - - - -
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HSBC Special - - - -
ICBC 3.69 2.45 2.45 2.65
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Kiwibank Special 3.40 2.55 2.65 2.65
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Last updated: 3 December 2020 9:38am

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