International share funds shine

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Research house Morningstar reveals the winners and the losers for the period ending Sept 30, 2000.

Wednesday, October 25th 2000, 11:49PM

Top 10 managed funds Qtr ending Sept 00
Retail unit trusts & group investment funds
1	Affinity - Healthcare Worldwide Growth Trust	28.33
2	Dresdner RCM Masterpiece - World Share Fund	11.82
3	Tower GAM Multi-Trading	11.81
4	Tower TORTIS - International	9.66
5	Direct New Zealand Second Fifteen	9.35
6	NZ Funds Management Global Blue Chip	9.05
7	BNZ International Equity Index Trust	9.02
8	Colonial First State Tasman Developing Companies Trust	8.73
9	NZ Funds Management Global Small Companies Trust	8.59
10	The Fisher Funds NZ Growth Fund	8.27
RETAIL SUPERANNUATION TRUSTS*
1	Sovereign Super International Property Fund	10.66
2	Cigna Nest Egg International Share	9.93
3	Royal & SunAlliance Superplan2000 North American	9.63
4	Royal & SunAlliance Superplan North American Fund	9.53
5	Sovereign Super International Currency Fund	9.02
6	Sovereign Super North American Fund	8.75
7	Armstrong Jones SIL 60's+ International Share Fund	8.34
8	Sovereign Super Select NZ Equities Fund	8.33
9	AMP Personal Retirement Plan Passive International Shares	7.10
10	Royal & SunAlliance Superplan2000 Global Fund	5.46

 Detailed Analysis - Unit Trusts and Group Investment Funds

• International equities trusts dominated the top-performing unit trusts and group investment funds over both the September 2000 quarter and year. International equities funds were six of the top 10 performers over the quarter, and eight of the top10 performers over the year.
• Over the quarter, New Zealand equity trusts continued to dominate the lowest-performing unit trusts and group investment funds, reflecting the continuing languishing performance of the New Zealand sharemarket. Six of the 10 lowest-performing trusts for the quarter were New Zealand equity trusts, and they were all market-tracking index funds: the Perpetual Trust New Zealand Share Fund No 5 (-3.91 quarterly net return), the BNZ New Zealand Equity Index Trust (-4.15%), the AMP Investment Tracker Fund (-4.21%), the AMP Unit Trust Passive New Zealand Shares Fund (-4.24%), the ASB New Zealand Shares Trust (-4.38%), and the WestpacTrust New Zealand Share Index Plus Trust (-5.83% quarterly net return).
• Over the quarter several New Zealand equity funds outperformed the general gloom attached to the New Zealand equity market, however, notably the Direct New Zealand Second Fifteen Fund (9.35% quarterly net return), the Colonial First State Tasman Developing Companies Trust, which invests in both New Zealand and Australian equities (8.59% quarterly net return), and the Fisher Funds New Zealand Growth Fund (8.27% quarterly net return).
• The top-performing unit trust or group investment fund for both the September 2000 quarter and year was a relative newcomer, the Affinity Healthcare Worldwide Growth Trust. This trust, which invests in international healthcare companies, produced a 28.33% quarterly net return, and a very creditable 145.62% annual net return. This was more than double the annual net return of the second-highest performing unit trust or group investment fund, the NZ Funds Management Global Small Companies Trust (62.99% annual net return).
• Over the quarter, the lowest-performing unit trust or group investment fund was the AMP Unit Trust Asian Shares Fund (-5.87% quarterly net return), while over the year the FCMI Toronto New Zealand Equity Trust was the lowest performer (-4.78% net return).
• Four Tower international equities funds were among the ten top-performing unit trusts over the year: the Tower Spotlight Emerging Europe Fund (38.04% annual net return); the Tower Tortis - International Fund (35.40% annual net return); the Tower Spotlight Europe Fund (34.68% annual net return); and the Tower Spotlight Latin America Fund (30.27% annual net return). Of these, however, only the Tower Tortis International Fund also featured among the quarterly top ten performers, with a 9.66% quarterly net return.

Detailed Analysis - Superannuation Trusts

• International equity funds took out seven of the top 10 places for superannuation trust performance over the September 2000 quarter. Notably, all 10 top-performing superannuation trusts for the September year were also international equity funds, reflecting good performance from international equity markets in previous quarters, despite recent market volatility.
• The continued vigour of the US equity market propelled three specialist US-investing superannuation funds into the top 10 performers over the year: the Sovereign Super North American Fund (34.36% annual net return), the Royal & SunAlliance Superplan2000 North American Fund (31.13% annual net return), and the Royal & SunAlliance Superplan North American Fund (30.68% annual net return).
• Over the quarter the top-performing superannuation trust was the Sovereign Super International Property Fund (10.66% quarterly net return). Over the year, the top performer was the Sovereign Super International Special Opportunities Fund, with a 36.81% net return. However, this fund was not among the top 10 performers over the September quarter, as most of this performance was achieved in the final quarter of 1999.
• The spread of quarterly net returns for the 10 top-performing superannuation trusts ranged from 10.66% for the Sovereign Super International Property Fund, to 5.46% for the 10th-ranked Royal & SunAlliance Superplan2000 Global Fund. Over the year, returns from the top 10 ranged more narrowly from the Sovereign Super International Special Opportunities Fund's 36.81% net return, to the Sovereign Super European Fund's 28.50% net return.
• Continuing the trend established over the quarter and year to 30 June, funds invested in Asia (four of the bottom 10 performers for the September quarter) and New Zealand equities (the remaining six) dominated the lowest-performing superannuation trusts. Over the year, the lowest performers were dominated by funds investing in New Zealand equities (especially market-tracking passive funds), and international fixed interest.
• The Tower FreedomPlan - Asia/Emerging Markets Fund was the lowest-performing superannuation trust for the September 2000 quarter, producing a -13.07% net return. (This fund was also the lowest-performing superannuation trust for the June quarter.) The Royal & SunAlliance Superplan New Zealand Large Companies Fund was the worst-performing superannuation trust for the year to 30 September, with a -7.39% net return.
• Royal & SunAlliance funds accounted for four of the 10 lowest-performing superannuation trusts for the September quarter, and six of the 10 lowest performers for the year, predominantly New Zealand equity funds. (Many of these Royal & SunAlliance funds, however, invest in the same underlying pool of money).

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