For the second quarter in a row an ANZ owned property fund has beaten Milford's Active Growth Fund for the top spot on a long-term regular-savings return basis.
Over the last three year period our analysis shows both ANZ and Milford's top performing funds are in turn beaten by Kiwi Wealth's Growth Fund.
Of the 23 funds that have been going since April 2008, all but 8 have returned double digit long run returns based on our unique regular savings basis. This is impressive given for the first two to three years global equities which make up a large portion of the total asset allocation for many of the funds were in a severe state of depression.
The last six years have been a golden age for shares and those having a long enough investment time horizon, a high degree of risk tolerance and patience to ride out the worst period for global shares in 70-years, have benefited handsomely.
Funds with heavy exposures to listed Property and Australasian equities have been the best performing funds since April 2008 based on our regular savings model.
Kiwi Wealth has been the most impressive recent improver. The next best improver is the NZX administered Smart Kiwi Growth Fund, although their fund is sitting in the bottom half of the leader board and would require many more quarters of exceptional out-performance to make any noticeable headway up the leader board, so we probably can't get too excited just yet.
What this and our last few category reviews is showing, is the top managers are able to deliver consistent returns over the long term and some others are simply there to make up numbers.
This may appear harsh but if you are trailing the leading funds by 5% plus over the long term you really have to question what the manager is doing to justify their fees and your hard earned cash.
ANZ's OneAnswer International Property is our ‘best-in-class’ Aggressive fund performer.
To be awarded this classification it must not only have the best track record for the full period, but its return over the past three years must not be less that those it earned over the full period.
On our regular savings basis, the average of the top five funds would have resulted in you earning $17,327 more than you have contributed.
While that may not seem a lot based on an average ending fund value of $40,226 it is significant when you realise that $22,899 is what you, your employer and the Government contributed.
The average of the top five Aggressive funds earnings after-tax and after-fees is $9,838 more than the $7,489 you would have earned from the average of the top five Default funds.
Compared to the last review in December 2014, there have been a few of the Mercer funds drop off the list. The funds were closed for commercial reasons and were mainly single sector offerings which failed to attract sufficient funds to justify keeping them open.
The second table below highlights those funds that have not been going the full distance and they are ranked on the level of contributions made based on our regular savings calculations.
Many of the funds in the second table have achieved returns over the short to medium term which would see them placed in the upper echelons of the main table if we ranked solely on performance.
Here are the full comparison as at March 31, 2015 for Aggressive Funds.
| Aggressive Funds |
Cumulative
contributions
(EE, ER, Govt)
|
+ Cum net gains
after all tax, fees
|
Effective
cum return
|
= Ending value
in your account
|
Effective
last 3 yr
return % p.a.
|
|||
| since April 2008 | X | Y | Z | |||||
| to March 2015 |
$
|
% p.a.
|
$
|
|||||
| ANZ OneAnswer Int'l Property | A | A | P | 22,899 | 19,162 | 14.3% | 42,062 | 14.9% |
| Milford Active Growth | A | G | AE | 22,899 | 17,951 | 13.6% | 40,850 | 15.2% |
| Aon Milford | A | G | AE | 22,899 | 17,814 | 13.5% | 40,713 | 15.1% |
| ANZ OneAnswerAustralasian Property | A | A | P |
22,899
|
16,737
|
12.9% |
39,637
|
13.8%
|
| ANZ OneAnswer Australasian Share | A | A | AE |
22,899
|
14,970 | 11.8% | 37,870 | 14.0% |
| Kiwi Wealth Growth Fund | A | A | A | 22,899 | 14,705 | 11.6% | 37,605 | 16.2% |
| ANZ OneAnswer Growth | A | G | G |
22,899
|
14,676 | 11.6% | 37,576 | 13.3% |
| Mercer SuperTrust Shares | A | A | AE | 22,899 | 14,667 | 11.6% | 37,566 | 14.3% |
| ANZ Growth | A | G | G |
22,899
|
14,513 | 11.5% | 37,412 | 13.2% |
| ANZ Default Growth | A | G | G | 22,899 | 13,305 | 10.7% | 36,205 | 12.7% |
| Mercer High Growth | A | A | A | 22,899 | 13,078 | 10.5% | 35,977 | 12.6% |
| Aon Russell LifePoints 2045 | A | G | A |
22,899
|
13,068 | 10.5% | 35,968 | 12.1% |
| ANZ OneAnswer Int'l Share | A | A | IE | 22,899 | 13,039 | 10.5% | 35,938 | 12.7% |
| Mercer SuperTrust High Growth | A | A | A | 22,899 | 12,998 | 10.5% | 35,898 | 12.7% |
| ASB Growth | A | G | G | 22,899 | 12,378 | 10.0% | 35,278 | 11.7% |
| Fisher Funds Growth | A | A | A |
22,899
|
12,156 | 9.9% | 35,055 | 10.6% |
| Westpac Growth | A | G | G | 22,899 | 11,632 | 9.5% | 34,531 | 11.0% |
| Staples Rodway Growth | A | G | G | 22,899 | 11,034 | 9.1% | 33,934 | 10.3% |
| AMP Aggressive | A | A | A | 22,899 | 10,859 | 8.9% | 33,759 | 10.6% |
| SmartKiwi Growth | A | A | AE | 22,899 | 10,518 | 8.7% | 33,417 | 12.1% |
| AMP Growth | A | G | G | 22,899 | 10,269 | 8.5% | 33,168 | 9.9% |
| Fisher Funds Two Equity | A | A | IE |
22,899
|
10,253 | 8.5% | 33,153 | 11.0% |
| Grosvenor High Growth | A | A | A | 22,899 | 9,104 | 7.6% | 32,003 | 9.9% |
| --------------- | ||||||||
| Column X is interest.co.nz definition, column Y is Sorted's definition, column Z is Morningstar's definition | ||||||||
| A = Aggressive, AE = Australasian Equities, G = Growth, IE = International Equities, P = Property | ||||||||
For those funds that have not been going for the full period (April 2008 to December 2014) the results are shown below. In this group Generate Focused Growth has been the standout performer followed by Grosvenor International Share and Amanah KiwiSaver Plan. Both Generate and Amanah are relative newcomers to the KiwiSaver universe and are yet to prove themselves over the long-term. However, the short term data shows some promise.
| Aggressive Funds |
Cumulative
contributions
(EE, ER, Govt)
|
+ Cum net gains
after all tax, fees
|
Effective
cum return
|
= Ending value
in your account
|
Effective
last 3 yr
return % p.a.
|
|||
| since April 2008 | X | Y | Z | |||||
| to March 2015 |
$
|
% p.a.
|
$
|
|||||
| ANZ OneAnswerSustainable Growth | A | A | IE |
22,290
|
8,070 | 7.4% | 30,361 | 10.0% |
| Grosvenor Geared Growth | A | A | A | 18,626 | 8,482 | 10.1% | 27,108 | 11.0% |
| Craigs Equity | A | A | A | 17,952 | 6,412 | 8.2% | 24,364 | 9.3% |
| Lifestages Growth | A | A | 17,073 | 5,708 | 11.9% | 22,781 | 8.9% | |
| Grosvenor International Share | A | A | IE | 15,612 | 7,408 | 11.9% | 23,021 | 11.8% |
| Grosvenor Socially Responsible | A | A | AE | 15,612 | 5,433 | 8.7% | 21,045 | 8.0% |
| Grosvenor Trans-Tasman Small Companies | A | A | AE | 15,612 | 1,958 | 2.1% | 17,571 | 0.1% |
| Craigs NZ Equity | A | A | AE | 13,849 | 6,049 | 11.8% | 19,898 | 11.2% |
| Craigs Australian Equity | A | A | AE | 13,849 | 4,061 | 7.7% | 17,909 | 8.1% |
| Generate Focused Growth | A | A | A | 6,287 | 2,016 | 10.7% | 8,303 |
n/a
|
| Amanah KiwiSaver Plan | A | A | 3,083 | 1,422 | 13.7% |
4,505
|
n/a
|
|
| --------------- | ||||||||
| Column X is interest.co.nz definition, column Y is Sorted's definition, column Z is Morningstar's definition | ||||||||
| A = Aggressive, AE = Australasian Equities, G = Growth, IE = International Equities, P = Property | ||||||||
There are wide variances in returns since April 2008, and even in the past three years, and these should cause investors to review their KiwiSaver accounts especially if their funds are in the bottom third of the table.
For explanations about how we calculate our 'regular savings returns' and how we classify funds, see here and here.
The right fund type for you will depend on your tolerance for risk and importantly on your life stage. You should move only with appropriate advice and for a substantial reason.
Our March reviews of the Conservative & Default funds, Moderate funds, Balanced funds and Growth funds can be found here, here, here and here.
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