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AXA's KiwiSaver results show a high degree of consistency in performance and ranking against peers

Posted in KiwiSaver

The latest data released for KiwiSaver performance as at September 30, 2012 is from AXA.

AXA is one of the six approved default providers and ranks fifth largest in terms of funds under management. Approximately 71% of the $883.93 mln invested in AXA KiwiSaver schemes is in the default fund.

AXA provide members with a variety of investment options with a focus being towards the more defensive end of the risk spectrum. For members wanting more exposure to growth assets AXA offers a Balanced and Growth strategy. It is likely we will see some rationalisation of the AXA schemes in coming months once the takeover by AMP is finalised.

Examining the make up of the various portfolios highlights that AXA offers exposure to the main asset classes including alternatives such as infrastructure and commodities.

They are one of the few managers who regularly invest in these types of assets as part of their Conservative fund - some will only use alternatives in their more aggressive funds. AXA also takes advantage of the greater opportunities available in the global property sector. (This is in contrast to other managers of diversified funds who only include NZ property and seemingly ignore the superior diversification (and return) benefits global property can offer.)

Within the more aggressive AXA schemes the manager includes a reasonable allocation to higher risk emerging markets. Some emerging economies have had well publicised economic slowdowns - such as China - and investors have sought the relative safety of more developed nations, especially the US. Therefore returns from emerging markets have had an adverse impact on the overall performance of the Balanced and Growth schemes.

The AXA funds have a reasonably high degree of consistency in performance over time (notably the Conservative, Income Plus and Cash funds).

While the Balanced and Growth fund's have shown consistency in their ranking among their respective peer groups, their performance lags the leaders at this point.

The recent trend of performance in the short term favouring equities, and over the long term favouring conseravtive funds, also holds true for the AXA portfolios.

Over the past 12 months the Growth Fund has returned +12.8% p.a. (vs +8.5% p.a for the Conservative Fund). The Conservative Fund has not been going a full five years; however since inception (April 2008) this fund has outperformed the Growth scheme by approximately +1.4% p.a.

Below is a table of the longer term performance of the AXA funds. The return data is before tax and after fees and is as published by the managers. (No adjustments have been made to take into account those additional fees which scheme providers may charge and which are not included in calculating the fund performance. We do make such adjustments, but they will not be included until the full benchmarking is published.)

AXA KiwiSaver Scheme
(30 Sept 2012)

1 year
(p.a.)
5 year
(p.a.)

Since inception (1 Oct 2007) (p.a.)

Income Plus Fund 7.8% 4.4% 4.4%
Cash Fund 3.0% 4.4% 4.4%
Conservative Fund* 8.5% n/a 5.8%
Balanced Fund 11.3% 1.6% 1.6%
Growth Fund 12.8% -1.0% -1.0%

 

 

 

 

 

 

 

 

* This fund commenced in April 2008 and does not have a five year track record yet.

More detailed performance reporting can be found here ».

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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