KiwiSaver funds with allocations to defensive assets are starting to shine again, new data shows.
For a number of years now, aggressive and growth funds with heavy allocations to equities have been the star performers.
But the latest Morningstar survey, for the June quarter, showed more conservative options gaining ground amid international jitters.
Most KiwiSaver funds had a positive quarter.
Morningstar’s Australasia director of manager research ratings Kathryn Young said investors who were most exposed to defensive or domestic assets did best.
“Investors should, however, focus on ensuring that their KiwiSaver option’s asset allocation best fits their investment timeframe and risk profile.”
Average multisector category returns were all positive for the June quarter, ranging from 0.34% for the aggressive category to 1.57% for the conservative category.
Aggressive funds were flat on average over the year to June 30, 2016, while the conservative category gained 5.2%. Over longer periods, however, funds with greater equity risk have generally gained more.
Notable performers over the quarter included ASB KiwiSaver, whose growth and balanced options topped their respective peer groups.
The best performers in the multisector conservative category were Milford KiwiSaver Conservative (2.43%), followed by Fisher Conservative KiwiSaver (2.42%), and Aon KiwiSaver Russell Lifepoints Conservative (2.10%).
KiwiSaver assets on the Morningstar database grew to $33.40 billion at June 30, 2016 from $954.10 million at June 30, 2008. The industry remains highly-concentrated, the six largest KiwiSaver providers accounting for 85.9% of assets on Morningstar’s database