NZ Super Fund ekes out small April rise

The New Zealand Superannuation Fund's value rose just 0.76% in April, helped by its cash and hedging positions, lifting the overall value of the retirement nest egg by about NZ$115 million to NZ$16.71 billion. Created by the previous Labour-led government to help offset the burden of paying universal superannuation to a generation of retiring baby boomers, the Super Fund's value has now increased by 23.2%, or about NZ$3.4 billion, since the start of the 2009-10 financial year last July. In the month to April 30 the value of the Super Fund's cash, collateral and forex hedging position improved by NZ$593.5 million to NZ$375.5 million. This helped offset falls in its share portfolio. At 35.1% the Super Fund, whose chief executive officer is former Reserve Bank deputy governor and head of financial stability Adrian Orr, has the biggest percentage of its money invested in international large cap equities. However, this holding dropped about NZ$400 million in value month-on-month. The Super Fund is behind in its long-term target which is to exceed the rate of return on Treasury bills by 2.5% over rolling 20-year periods. It's currently up 0.58% since its September 2003 inception. Overall the Super Fund, which has received a total of NZ$14.88 billion in government contributions including NZ$250 million this financial year, has produced annualised absolute returns since its inception of 6.68%. In last May's Budget the National-led Government revealed plans to suspend payments to the Super Fund for at least a decade as it strives to reduce Crown debt. The Super Fund, which bought Shell's New Zealand retail and distribution business in partnership with Infratil for NZ$696.5 million last month, includes Auckland International Airport, Transurban Group and Flughafen Zuerich among its major equity holdings. It also has money in property, commodities, fixed income, forestry and private equity investments. Click here to read the Super Fund's full statement.