NZ Funds Investment Report H1 2021

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Over the last few years the conversations around KiwiSaver have been dominated by modest returns and the benefits of low fees. Recently, there has been much discussion about the $1.2 billion that investors switched from growth to income funds during the recent COVID-19-driven sell off.

However, there has been little discussion of behavioural economics, which identifies that investors often feel compelled to switch at low points in the cycle. Or of the solution, which is access to high quality, affordable, financial advice.

Internationally there continues to be a steady stream of academic research quantifying the benefits of working with a financial adviser over an investment lifetime. One study showed that individuals and families who were fortunate enough to work with an adviser accumulated more than twice as much as those who invested on their own.

The year ending 31 March 2021 was a seminal one for NZ Funds. Our investment approach, which continues to be unique in New Zealand (but more common overseas), successfully mitigated the downside for investors during a frightening time. We then captured the upside as financial markets recovered.

What made the year particularly noteworthy for the team at NZ Funds was the chance to help those who were less fortunate. With the help of over 300 financial advisers – most notably Sue Stewart, Director and Financial Adviser at Medical Financial Advisers – we were able to assist 2,700 distressed New Zealanders who were invested with a wide range of predominately low-cost providers whose services did not include financial advice. In a time of crisis, website information, chatbots and overloaded call centres simply don’t pass muster...


Please read the full Investment Report below.

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