sign up log in
Want to go ad-free? Find out how, here.

KiwiSaver funds reflect 'challenging underlying market conditions' and led down by real estate investment funds, says Morningstar

Personal Finance / news
KiwiSaver funds reflect 'challenging underlying market conditions' and led down by real estate investment funds, says Morningstar
kiwisaversurveyseptember2022

KiwiSaver funds under management increased $741 million to $83.5 billion in the September quarter, according to research firm Morningstar.

This is in contrast to the June quarter where funds decreased by $4.95 billion, and the March quarter when there was a $1.5 billion drop.

“KiwiSaver funds generally reflected the challenging underlying market conditions experienced over the September quarter. The average multi-sector category returns ranged from -1.3% for the Conservative category to -1.8% for the Growth category," Morningstar Director of Manager Selection Tim Murphy says.

The average conservative fund return for the September quarter was -1.3%. Average moderate fund and balanced fund return was -1.5%. Average growth fund return was -1.8% and the average aggressive fund return was -1.6%.

The highest 3-month performance this quarter was in australasian equity by SuperLife Australia Mid Cap at 6.2%, while the lowest 3-Month performance this quarter was in property by OneAnswer International Property at -11.1%.

ANZ leads the market share with more than NZ$17.07 billion. ASB is in second position, with a market share of 16.0%. Westpac holds third spot ahead of Fisher Funds, while Kiwi Wealth sits in fifth spot. The six largest KiwiSaver providers account for approximately 69% of assets on the database. 

Top performers over the quarter against their peer group includes Milford Conservative 0.5% (Multisector Conservative), InvestNow Mint Diversif Inc 1.4% (Multisector Moderate), InvestNow Milford Balanced 1.3% (Multisector Balanced), QuayStreet Growth 1.6% (Multisector Growth) and Milford Aggressive 0.4% (Multisector Aggressive).

Tim Murphy says, “It is most appropriate to evaluate performance of a KiwiSaver scheme by studying its long-term returns. Over 10 years, the Aggressive category average has given investors an annualised return of 8.5%, followed by Growth (8.0%), Balanced (6.4%), Moderate (4.3%), and Conservative (3.9%)”.

Default options appointed in 2021 still have less than one year of performance, which is too short a period to make meaningful assessments.

NZ Real Estate Investment Trusts (REITs) have underperformed compared with the wider local equity market. 

To end of September the S&P/NZX All Real Estate Index made a capital loss of 21.8% and a total return loss including dividends of 19.4% year to date, compared with the overall equity market’s 17.2% capital loss and 15.1% overall loss year to date.

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.