KiwiSaver

Fidelity Life’s Options Kiwi Fund was named as the best performing KiwiSaver fund out of 120 surveyed by FundSource for the three years to December 31, 2010.

With an annual average return of 11.59% over three years the Fidelity Life Kiwi Options was placed well ahead of the next placed fund in the survey, the Milford KiwiSaver Aggressive Fund.

In the year to January 31 it returned 9.21%.

The fund is one of the more unique KiwiSaver funds and is modeled on Fidelity’s Options Portfolio, managed by Tyndall Investment Management, which is a cash fund that issues options on US 10-year and other government bonds.

Fidelity Life CEO Milton Jennings said the alternative, fixed-interest strategy of the Options Kiwi Fund had produced consistently high returns for its KiwiSaver investors and attracted a growing number of New Zealanders.

The overall fund is now worth $36.7 million, up 64% on the year-earlier period.

“We have to produce consistent, and consistently high, returns for our customers to be successful,” Jennings said.

“The key benefit of our Options Kiwi Fund for investors is its focus on sound medium to long term management. This means the shorter term swings of potentially volatile financial markets are smoothed out.”

Jennings said that for Options KiwiSaver Fund customers, “the results speak for themselves.”

“An initial $1,000 invested with Fidelity Life in the fund three years ago on February 1, 2008 is now worth $1,473.97 on January 28, 2011.”

Jennings also said some 80% of Fidelity Life’s senior management have all or some of their portfolios invested in the company’s Options range of products.

He also said KiwiSaver has been a constant growth area for Fidelity Life, with a 96.6% increase in KiwiSaver funds under management, from $92.3 million on January 31, 2010 to $181.5 million on January 31, 2011.

Fidelity Life has signed up a total of 72,000 KiwiSaver members since the launch of the scheme more than three years ago.

KiwiSaver funds ended 2010 strongly with positive returns across all sectors for the December quarter – and the year – according to the latest Mercer KiwiSaver Survey.

KiwiSaver growth funds – which have the greatest exposure to shares and property – performed best with a median return of 3.7% for the quarter ended December 31. The best performing fund for the quarter was the AMP Aggressive Growth Fund, with a 6.3% return.

By comparison, the more conservative default fund, had a median return of 0.9%.

Positive returns across the board were enjoyed by all KiwiSavers over last year.

For the whole of 2010, growth funds and balanced funds performed best with median returns of 7.1%, while conservative funds had 6.1% and default funds 5.9%.

At the start of 2010, an investment of $100 in the median default fund would be nearly $106, Conservative fund $106, Balanced and Growth funds $107, excluding the impact of any employer or government contributions.

Among the top performing Growth funds the Fisher Funds Growth Fund was the best performer, up 12.1% in the 12 months to December 2010.

Over the year the best performing fund in the Default sector was the Mercer Conservative (6.2%), the best performing Conservative fund was the Aon Russell Lifepoints 2015 (10%) and the best performing Balanced fund was the Aon Russell Balanced (10.4%).

However, since the scheme’s launch in 2007 funds with the highest allocation to bonds and cash remain the best performers, reflecting volatile sharemarket performance over that period.

KiwiSaver has jumped ahead of managed funds and shares as the investment option offering the best returns, and an increasing number of people see the scheme as their primary means of retirement.

The findings have been revealed in the latest ASB Investor Confidence Survey which found KiwiSaver the third most favoured investment option behind term deposits and rental property.

“For the first time KiwiSaver jumped ahead of managed investments and shares as the investment offering the best returns,” said ASB head of private banking and wealth management Jonathan Beale.

“In addition a record 61% of respondents indicated that KiwiSaver would be their primary means of retirement, a percentage which has steadily increased in recent quarters.”

The survey revealed the  expectation that KiwiSaver would be enough to retire on was strongest among  those under 50, with 22% aged between 18-49 believing KiwiSaver would be enough for retirement, up 5% from the last quarter.

In the over 50 age group, 12% believed KiwiSaver alone would be adequate for retirement provision, also up 5%.

“It’s very encouraging to see those aged under 50 being so positive about their prospects with KiwiSaver, as this age group needs to start now to ensure they build up a sufficient nest egg for their retirement,” Beale said.

“KiwiSaver will be an important contributor to the future wealth of our country, so it is heartening to see this positive attitude.”

The survey found that overall investor confidence has begun to rise, with the three months to December 31 seeing the number of investors expecting to see their returns improve climb 4% to 19%.

Term deposits retained their top spot as most favoured investment choice, up 1% on the previous quarter to 21%.

While Beale said term deposits had returned to their highest level of popularity since the 2008 third quarter, he said the data indicated a dip in sentiment in December.

“Investors are likely to have been influenced by the December Reserve Bank announcement cautioning a slowdown on interest rates, which they again repeated in January.”

Rental property was the second most favoured investment option with 14% followed by KiwiSaver, managed funds (9%) and shares (6%).

Returns to 31 December 2010

 

Default Options	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP Default Fund	1.86	4.17	4.63	5.55	3.97
ASB Scheme’s Cnsrv (Default)	0.54	3.93	5.69	6.04	4.72
AXA Income Plus (Default)	1.00	4.40	6.22	8.46	4.44
Mercer Conservative (Default)	0.62	2.69	6.34	10.10	5.34
OnePath Conservative (Default)	0.49	3.90	6.06	6.18	4.84
TOWER Cash Enhanced (Default)	1.03	3.31	5.04	6.34	4.32
Peer Group Averages	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
Default Options	0.92	3.73	5.66	7.11	4.60
Conservative	0.81	3.84	5.63	6.95	4.65
Moderate	1.32	5.35	6.06	8.55	3.40
Balanced	2.40	7.12	6.01	9.95	1.92
Growth	3.20	8.80	6.19	11.06	-0.11
Aggressive	4.26	10.64	6.25	14.16	-0.49
Multisector Options
Conservative	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP Default Fund	1.86	4.17	4.63	5.55	3.97
ANZ – Conservative Fund	0.59	3.86	5.95	6.24	4.83
Aon Russell Lifepoints Cnsrv	0.68	5.07	9.93	13.77	6.25
ASB Scheme’s Cnsrv (Default)	0.54	3.93	5.69	6.04	4.72
AXA Income Plus (Default)	1.00	4.40	6.22	8.46	4.44
FC Scheme’s Tracker Cnsrv	0.54	3.92	5.65	6.02	4.67
Fidelity Capital Guarant Kiwi	0.58	2.92	4.39	4.66	—
Fidelity Conservative Kiwi Fd	0.65	4.71	6.31	6.76	4.90
Fisher Funds Conservative Fund	0.64	2.88	2.89	—	—
Mercer Conservative (Default)	0.62	2.69	6.34	10.10	5.34
National Bank – Conserv	0.58	3.86	5.94	6.30	4.88
OnePath Conservative (Default)	0.49	3.90	6.06	6.18	4.84
SIL Conservative	0.60	3.91	6.04	6.37	5.03
Smartshares Conservative	1.78	4.05	3.32	4.57	2.21
TOWER Cash Enhanced (Default)	1.03	3.31	5.04	6.34	4.32
Average	0.81	3.84	5.63	6.95	4.65
Moderate	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP LS Conservative Fund	1.21	4.39	5.51	5.61	5.31
AMP LS Moderate Fund	2.17	5.91	5.75	6.71	3.07
ANZ – Conservative Bal	1.51	5.72	6.55	7.91	3.67
Aon Russell Lifepoints 2015	1.72	6.49	10.04	15.22	4.60
Aon Russell Lifepoints Mod	2.42	7.41	10.17	15.76	3.96
ASB Scheme’s Moderate	1.36	6.52	7.16	8.43	3.12
AXA Conservative	1.16	5.12	6.62	8.87	—
FC Scheme’s Active Cnsrv	0.77	4.58	5.21	8.07	3.44
FC Scheme’s Tracker Moderat	1.36	6.52	7.12	8.42	2.85
Grosvenor Conservative Fund	-0.53	2.38	4.96	6.09	3.91
Huljich Conservative Divers Fd	0.21	1.36	-2.56	4.50	—
Mercer Super Trust Conserv	1.10	3.51	6.33	10.58	3.82
National Bank – Conserv Bal Fd	1.52	5.75	6.60	7.92	3.66
OnePath Conservative Balanced	1.29	5.59	6.12	7.10	3.31
SIL Conservative Balanced	1.53	5.76	6.76	8.18	3.89
Smartshares Balanced	2.66	11.00	4.29	9.35	-1.82
TOWER Conservative	0.80	3.95	7.02	8.81	3.99
Westpac Conservative Fund	1.47	4.41	5.44	6.35	3.70
Average	1.32	5.35	6.06	8.55	3.40
Balanced	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP LS Balanced Fund	3.55	8.45	6.19	8.67	0.90
AMP LS Moderate Balanced Fund	3.15	7.47	6.02	7.83	1.55
AMP TOWER Balanced Fund	2.74	6.46	7.96	10.33	2.23
ANZ – Balanced Fund	2.35	7.41	6.94	9.41	2.39
Aon OnePath Balanced	3.29	8.75	9.29	15.24	4.01
Aon Russell Lifepoints 2025	3.48	8.81	10.28	16.80	1.88
Aon Russell Lifepoints Bal	4.24	9.98	10.39	17.58	1.21
ASB Scheme’s Balanced	2.49	9.08	7.62	10.17	0.97
AXA Balanced	3.32	9.68	7.05	12.94	0.88
Brook Professional Balanced Fd	1.86	5.31	1.53	5.77	3.78
FC Scheme’s Active Balanced	1.94	7.56	5.42	9.88	0.32
FC Scheme’s Tracker Balancd	2.49	9.07	7.57	10.17	0.79
Fidelity Balanced Kiwi Fund	1.51	6.61	5.70	7.17	4.40
Fidelity Ethical Kiwi	1.39	6.57	5.34	8.39	—
Forsyth Barr Balanced Port	2.06	4.41	1.22	5.95	—
Grosvenor Balanced Fund	0.20	4.02	3.94	7.35	2.23
Huljich Balanced Diversified	-0.08	0.90	-6.00	4.47	—
Mercer Balanced	2.57	7.16	7.38	13.51	0.70
Mercer Super Trust Moderate	2.07	6.06	6.72	11.65	2.05
Milford Balanced	2.62	6.84	—	—	—
National Bank – Bal	2.37	7.43	6.99	9.41	2.42
OnePath Balanced	2.12	7.28	6.17	8.03	1.51
SIL Balanced	2.39	7.43	7.06	9.63	2.64
TOWER Balanced	2.26	7.04	7.68	9.94	1.95
Westpac Balanced Fund	3.72	8.22	5.84	8.60	1.56
Average	2.40	7.12	6.01	9.95	1.92
Growth	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP LS Growth Fund	5.15	10.62	6.59	10.07	-2.02
AMP OnePath Balanced Plus Fund	3.63	8.42	7.54	11.85	2.07
AMP Tyndall Balanced Fund	1.90	5.89	6.53	10.16	0.08
ANZ – Balanced Gth Fund	3.24	9.08	7.36	10.90	0.96
ANZ – Growth Fund	4.12	10.79	7.52	12.33	-0.62
Aon Russell Lifepoints 2035	4.94	10.78	10.41	17.87	-0.24
Aon Russell Lifepoints Growth	5.39	11.40	10.44	18.29	-0.72
Aon Tyndall Balanced	1.59	6.24	6.48	10.26	1.65
ASB Scheme’s Growth	3.70	11.62	7.73	11.58	-1.26
FC Scheme’s Active Growth	2.80	9.64	4.95	10.80	-1.43
FC Scheme’s Tracker Growth	3.71	11.62	7.70	11.59	-1.54
Fidelity Growth Kiwi Fund	2.39	8.67	5.43	7.87	2.30
Forsyth Barr Growth Portfolio	3.20	6.11	0.15	6.77	—
Grosvenor Balanced Growth	0.85	5.88	—	—	—
Huljich Growth Diversified Fd	-0.13	0.68	-9.53	3.56	—
Mercer Super Trust Active Bal	2.52	7.12	7.20	13.10	0.64
Mercer Super Trust Growth	3.17	8.60	7.01	13.22	-0.95
National Bank – Bal Gth Fund	3.27	9.12	7.42	10.92	0.93
National Bank – Gth Fd	4.13	10.78	7.57	12.22	-0.69
OnePath Balanced Growth	2.96	8.92	5.99	8.89	-0.28
OnePath Growth	3.87	10.69	5.79	9.63	-2.06
SIL Balanced Growth	3.27	9.15	7.35	11.12	1.19
SIL Growth Fund	4.16	10.85	7.66	12.62	-0.40
Staples Rodway Balanced	3.53	10.05	7.76	10.34	—
Staples Rodway Growth	1.33	6.44	6.17	11.14	—
Westpac Growth Fund	4.51	9.59	5.64	9.47	0.17
Average	3.20	8.80	6.19	11.06	-0.11
Aggressive	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP LS Aggressive Fund	6.16	12.24	6.79	11.09	-3.62
Aon Russell Lifepoints 2045	6.29	12.64	10.57	19.08	-2.51
AXA Growth	5.15	12.98	6.80	14.71	-1.81
Brook Professional Growth Fund	2.94	8.27	1.37	8.62	4.76
Fidelity Aggressive Kiwi Fund	2.93	9.61	6.96	14.14	2.48
Fisher Funds Growth Fund	4.57	14.55	10.68	27.89	5.51
Grosvenor Geared Growth Fund	1.47	6.90	3.25	—	—
Grosvenor High Growth Fund	1.60	6.97	2.79	8.27	-2.93
Mercer High Growth	4.15	10.95	7.83	14.78	-2.71
Mercer Super Trust High Growth	4.07	10.82	7.45	14.09	-2.86
TOWER Growth	3.83	9.57	8.18	12.79	-1.23
Westpac Capital Protect Plan 1	6.09	11.43	4.32	10.29	—
Westpac Capital Protect Plan 2	6.09	11.42	4.29	—	—
Average	4.26	10.64	6.25	14.16	-0.49
Single Sector Options
Cash	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
AMP Cash Fund	0.90	1.79	3.37	3.51	5.14
ANZ Cash Fund	0.64	1.25	2.24	2.47	—
Aon OnePath Cash	0.83	1.56	2.85	2.80	4.43
Aon Tyndall Cash	0.95	1.75	3.55	3.60	5.18
ASB Scheme’s NZ Bank Deposit	0.71	1.41	2.61	2.78	4.64
AXA Cash	0.74	1.50	2.91	3.32	4.44
FC Scheme’s NZ Cash	0.71	1.40	2.58	2.76	4.61
Grosvenor Enhanced Income Fund	0.82	1.86	3.70	3.49	5.54
Mercer Cash	1.09	2.16	4.58	4.24	5.63
Mercer Super Trust Cash	1.01	2.04	4.58	4.18	5.58
National Bank – Cash Fd	0.64	1.25	2.26	2.49	—
OnePath Cash Fund	0.67	1.33	2.48	2.75	4.74
SIL Cash Fund	0.54	1.07	1.93	2.18	4.18
Staples Rodway Conservative	0.97	1.80	3.69	2.91	—
TOWER Preservation	0.76	1.58	3.03	3.30	4.95
Westpac Cash Fund	0.79	1.56	2.88	3.15	4.04
Fixed Income	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
Mercer Super Trust Fixed Intr	-1.34	-0.96	6.78	11.80	8.53
SIL International Fixed Int	-1.72	1.16	5.69	4.09	7.80
SIL New Zealand Fixed Interest	-0.47	2.03	8.02	5.58	5.88
Property	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
Mercer Super Trust Real Assets	3.67	7.25	6.44	16.98	-5.25
SIL Australasian Property	3.33	11.74	3.12	8.91	-4.36
SIL International Property	7.67	21.40	23.33	24.24	-4.79
Australasian Equity	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
Aon Milford	2.66	7.28	6.14	—	—
Grosvenor Socially Responsible	1.83	9.41	—	—	—
Grosvenor Trs-Tasm Sm Coms Shr	4.59	24.72	—	—	—
Mercer Super Trust Shares	4.98	14.07	7.31	14.07	-4.89
Mercer Super Trust TransTasman	4.49	10.13	2.50	11.88	-3.87
Milford Aggressive	2.66	7.28	6.13	13.78	9.74
SIL Australasian Share	4.68	9.99	1.61	10.48	-4.58
Smartshares Growth	3.25	16.67	3.86	12.59	-6.39
International Equity	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
FC Scheme’s Active High Growth	4.03	11.45	4.52	9.00	—
FC Scheme’s Global Sustain	4.39	10.36	8.47	13.09	—
Grosvenor International Share	0.92	6.44	—	—	—
Mercer Super Trust Global	5.17	15.60	9.18	14.45	-5.77
SIL International Share	2.26	8.50	5.19	7.68	-2.92
SIL Sustainable Growth Fund	1.01	6.74	1.94	4.84	—
TOWER Equity	7.07	14.22	9.70	14.23	-4.56
Miscellaneous	3-month (%)	6-month (%)	1-year (%)	2-year (%pa)	3-year (%pa)
Fidelity Options Kiwi Fund	2.58	5.39	9.21	23.15	11.59

 

(NB: Returns are before tax and after the fees deducted from the funds unit price.)