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KiwiSaver managers shake off downturn

Growth investment strategies have helped fund managers to outperform over the past quarter, Morningstar says.

Thursday, July 30th 2020, 2:35PM

Growth investment strategies have helped fund managers to outperform over the past quarter, Morningstar says.

The research house has released its latest KiwiSaver survey, which shows that funds’ performance in the June quarter generally reflected the improved underlying market conditions.

But funds with a large exposure to US growth stocks or overweight to a2 Milk and Fisher & Paykel Healthcare in their NZ equity exposure are likely to have performed particularly well.

Morningstar director of manager research Tim Murphy said the growth style of investing in equities had materially outperformed the value style.

That was driven by tech stocks and certain pockets of healthcare, he said.

“Locally New Zealand is one of the best performing markets in the world. A couple of bigger stocks are playing a big part as part of the themes driving that.”

Managers who were overweight to Fisher & Paykel Healthcare and a2 Milk tended to do better, he said.

“The better performing managers in the quarter tended to have more exposure to growth.”

Top performers over the quarter against their peer group included Kiwi Wealth KiwiSaver Scheme Conservative 7.0% (Multisector Conservative), Aon KiwiSaver Russell LifePoints Moderate 8.3% (Multisector Moderate), SuperLife KiwiSaver Growth 11.6% (Multisector Balanced), AMP KiwiSaver Nikko AM Growth 14.8% (Multisector Growth) and Booster KiwiSaver Geared Growth 19.9% (Multisector Aggressive).

Over 10 years, the growth category average had given investors an annualised return of 9.6%, followed by aggressive (9.0%), balanced (8.1%), moderate (6.5%) and conservative (6.0%).

KiwiSaver assets on the Morningstar database had recovered from their March lows and sit at NZ$66.5 billion as at June 30, 2020 up from NZ$63.1 billion at December 31, 2019. ANZ leads the market share with more than NZ$15.5 billion. ASB is in second position, with a market share of 18.2%.

Murphy said there was increasing competition in the KiwiSaver space which should provide better outcomes for investors over the long term.

Tags: investment KiwiSaver Morningstar

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Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.15 3.25 3.39
ANZ Special - 2.55 2.69 2.79
ASB Bank 4.45 2.55 2.69 2.79
Bluestone 3.49 3.49 3.49 3.49
BNZ - Classic - 2.55 2.69 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.15 3.29 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 5.50 - - -
Lender Flt 1yr 2yr 3yr
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 ▼3.85 ▼3.95 -
HSBC Premier 4.49 2.45 2.60 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 3.69 2.55 2.65 2.79
Kainga Ora 4.43 ▼2.93 ▼3.07 ▼3.24
Kiwibank 3.40 3.30 3.54 3.54
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.55 2.79 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Resimac ▼3.39 3.45 ▼2.99 ▼3.35
SBS Bank 4.54 ▼3.05 3.19 ▼3.25
Lender Flt 1yr 2yr 3yr
SBS Bank Special - ▼2.55 2.69 ▼2.75
The Co-operative Bank - Owner Occ 4.40 2.55 2.69 ▼2.79
The Co-operative Bank - Standard 4.40 3.05 3.19 ▼3.29
TSB Bank 5.34 3.35 3.49 3.79
TSB Special 4.54 2.55 2.69 2.99
Wairarapa Building Society 4.99 3.65 3.69 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - 2.55 2.69 2.79
Median 4.55 3.05 3.13 3.12

Last updated: 11 August 2020 8:24am

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