News Round Up

New Zealand fund managers reviewed; Lifting retirement age inevitable; Morgan enters wholesale funds management.

Monday, May 18th 2009, 5:49AM

Morningstar has released updated research on the New Zealand equities management skills of four fund managers.

The four managers covered in the research are ING, Milford, Tyndall and Mint.

Tyndall's Aggressive Strategy is the highest ranked scoring "Recommended" status.

Tyndall's Core strategy along with the offerings from Milford, Mint and ING have all been given an investment grade rating. This is behind Highly Recommended and Recommended.

Morningstar describes ING as "suitable, but unspectacular", while it says Milford and Mint are young but unproven yet.

Increase in retirement age "inevitable": Arkinstall
It is envitable that the New Zealand government will have to consider raising the age of eligibility for NZ Superannuation, Investment Savings and Insurance Association chief executive Vance Arkinstall says.

In its Federal budget last week the Australian Government announced it will increase the retirement age to 67.

Arkinstall says New Zealand has similar demographics to Australia.

"There is already ample evidence that a number of New Zealanders are choosing to continue to work past 65. Also, younger people do not expect the age at which they will become entitled to NZ Super to remain at 65".

He says any change needs a long lead-in time so there is minimum disruption. Australia have announced a 15 year lead-in time for their changes.

Gareth Morgan to enter to wholesale fund management
Outspoken KiwiSaver fund manager Gareth Morgan and outgoing TradeMe business manager Mike O'Donnell plan to enter wholesale fund management.

Morgan's fairly unstructured approach has been successful in his retail and KiwiSaver funds, and it will be interesting to see whether he can achieve this in the wholesale side, said Mark Weaver, an actuary at Melville Jessup Weaver.

"I think it will be good for the industry which has undergone a huge change," Weaver said.

With very little information about the new fund, including what it will be called, it's too early to predict what Morgan has planned, but investors and competitors alike will be watching this space.

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