Conservative funds take lead

After a number of years where growth and aggressive schemes were the outperformers, a period of sharemarket volatility has seen the balance tip back in favour of those invested in less risky assets.

Morningstar has released its survey for the quarter ended March 31.

It found funds with a tilt towards defensive assets outperformed growth funds in the quarter. Average returns were positive across the board, ranging from 0.79% for the aggressive category through to 2.65% for the moderate category.

“Despite a volatile first quarter in global markets, most KiwiSaver funds delivered positive performance, with more conservatively-oriented options in particular doing well,” Morningstar Australasia director of manager research Tim Murphy said. “Strong returns from bond markets, coupled with the local sharemarket’s resilience, meant that most KiwiSaver investors’ retirement savings continued to grow.”