17th December 2004
NZ Equity Continues to Boost Managed Fund Investors
Figures released today by investment research company FundSource show NZ equity fund investors continuing to reap the
benefits of a strong New Zealand economy and as a result, a strong NZ sharemarket.
NZ Equity funds returned on average 4.1% for November, and an impressive 18% return in the past 12 months. This will
delight those investors that currently have $850 million invested directly in domestic equity funds and even more via
Following is a summary of the main investment sector performances:
New Zealand Equity (Active) Unit Trusts
Average performances for NZ Equity active funds in November were 4.1%, while posting an 18.13% return for the year.
Reflecting the strong market performances that the funds drew from, the NZX50 Gross (33%) returned 4.25% and 17.86% for
the month and year respectively. Top performer was the Fisher Funds NZ Growth fund with 25.99% for the year (5.00% for
November), while the Asteron NZ Share Growth Trust rose 19.87% for the year after a 4.08% return in November.
"The good times keep rolling for the NZ sharemarket as the domestic economy continues to defy dire short term
predictions to maintain strong levels” says Tim Anderson, Business Manager at FundSource. “This will delight equity fund
investors who are not only relishing this short term success, but are also now enjoying 5 year annualised performance of
8.5%” Poorer 1yr performers included the Westpac Selected NZ Shares Trust and AMP NZ Shares Trust with 14.75% and 15.97%
respectively. No fund recorded performance under 14% for the year.
International Equity (Global) Unit Trust
NZ investors currently have $2.4billion invested in international equity funds. AMP leads the way for International
Equity Funds with its AMP International Shares Trust recording 9.09% for the year, after a strong November result of
4.27%. Performances overall for international equities were not as positive, with an average post tax and fees return of
5.47% in the past 12months. This return outperforms the underlying benchmark, the MSCI World Free Gross (33%) index,
which had an annual return of approximately 4% in New Zealand dollar terms.
"While prima facie performances for international markets appear modest, underlying the returns has been a solid 10%
appreciation in the MSCI World Index. Unfortunately it has been an appreciating NZ currency that has taken the gloss
off." says Tim Anderson Business Manager at FundSource. “The New Zealand dollar for example has appreciated 11.5%
against the greenback and 5% against the Yen in the past 12 months.” Joining the AMP fund as a top performer was the BNZ
International Equity Trust with 7.22%, while poor performers included the volatile Affinity Healthcare Worldwide Growth
Fund and the passive AMP WiNZ fund, with -4.76% and -1.36% respectively.
The largest managed fund sector with over $7billion of New Zealanders’ money invested, Diversified funds also enjoyed
good growth in the year to November 2004.
Primarily on the back of positive equity market performance, balanced funds returned 7.69% in the year, following 1.9%
for the November month. As to be expected with a higher allocation to equities, growth orientated diversified funds
performed better with 9.04% for the year after 2.28% for the month.
"Overall the funds management industry is pleased to see a continuation of ‘normal’ type market performances
internationally, while very much enjoying the buoyant local market. With the short term economic outlook for the New
Zealand market being revised up, international equities continuing to exhibit solid returns, and a stabilising New
Zealand dollar, investors may look forward to a fruitful 2005." says Tim Anderson, Business Manager at FundSource.