Emerging markets show long-term gain

A shareholding with a small overweighting to emerging markets would have consistently added value over the past 20 years, according to the latest Melville Jessup Weaver investment survey.

Wednesday, January 23rd 2013, 9:30PM

by Susan Edmunds

The survey, which compared the MCSI developed markets index to emerging sharemarkets, looked at changes in the Kiwi dollar and movements in the CPI and OCR, found the outperformance of emerging markets was significant, although most of the gains happened between 2002 and 2007.

There was a major fall in 2008 and 2009 and subsequent recovery.

Since 2009, both markets have experience similar levels of volatility.

The survey found the December quarter showed strong results in the growth asset sectors, particularly the New Zealand sharemarket.

It finished the quarter up 6.3% and the year 25.9%.

Kiwi bonds were more subdued but global bonds rose 1.5% over the quarter.

The dollar dropped against both the US and Australian dollars. It was down 0.5% for the quarter against the US but up 5.8% for the year and down 0.5% for the quarter against the Australian but up 4.4% for the year.

NZX listed property returned 20.5% over the year and 3.5% over the quarter. Global property returned 26.2%.

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