KiwiSaver rally strongest in riskier, long term plays

A substantial investment market rally has seen the NZ sharemarket up 22%, Australia up 35% and the aggregate global sharemarket up almost 12% since March. "The past six months have clearly illustrated how quickly markets can turn around," said Chris Douglas, Morningstar Australasia's manager, Fund Analysis. 

"KiwiSavers who switched to conservative options would have missed out on these rapid gains. While short-term volatility is inevitable, KiwiSaver options investing in growth assets continue to offer the greatest potential for growing the value of retirement savings over the longer term." 

Reporting on over 120 KiwiSaver investment options, all categories produced positive results said Douglas. The best-performing funds were the growth-oriented vehicles with greater proportions of their assets in local and international share and listed property. "

These were the funds that were hardest hit by the market declines from late 2007 to early 2009," he said. "Most KiwiSaver options in the Multi-Sector Growth and Aggressive categories returned 15 to 20% over the six month period.