International shares continue to shine

Investors in managed funds continued to reap outstanding returns from international equity funds in the month of February, research house FundSource says, continuing their high-performance streak over much of the last three years.

Wednesday, March 22nd 2006, 6:36AM

It says the 2% return recorded for international equity funds (both global and regional sectors) in the month of February alone has boosted investor returns to more than 20% for the past 12 months. Even over the longer term investors have been awarded healthy returns.

The global international equity funds averaged 13.8% and regional international equity funds recorded even better results, averaging 20.2% over the past 3 years.

Keeping in line with recent trends, international equity funds continued to be the top performer in February, across all sectors. Strong returns from international equities also helped boost investor returns in diversified funds (which invest into International equities in varying proportions), averaging around 10% (after tax and fees) over the past 12 months.

“The prospect for international equities continues to be robust and the ongoing depreciation of the New Zealand dollar against the US dollar remains a positive factor for investors, depending on the level of currency hedging within their investment portfolios.”

Actively managed New Zealand share funds improved slightly in February, compared to the month before, but remained subdued relative to their heady experience over much of 2005. The average fund performance for February was 1.8%, and 4.8% over the last 12 months post taxes and fees.

With the outlook for the domestic economy in slowdown mode, it is not expected that returns from this sector will remain as high as in recent years.

The top performing fund for the month of February was the Fisher Funds NZ Growth Fund at 3.0%.

Diversified funds across the Defensive, Balanced and Growth sectors produced healthy returns in February.

Those with the highest allocation to international equities produced 1.4% in February and 11.7% for the past 12 months.

The mortgage and cash sectors picked up their performance after a slow January. Mortgages raised their average for the last 12 months to 4.9% andb cash funds averaged 4.1%.

« Aust firm buys half of Strategic

Sovereign takes regulation bull by the horns »

Special Offers