KiwiSaver funds under management rose by $4.6 billion in the March 2024 quarter according to research firm Morningstar, while the gap between the two biggest KiwiSaver funds closed in.
Greg Bunkall, data director at Morningstar, said KiwiSaver assets ended the quarter at $108.6 billion, up from $104 billion in December.
ANZ is still ahead of the pack when it comes to KiwiSaver market share with 18.8%, or $20.4 billion, of the market.
Fisher Funds is currently still in second position – a spot the provider has held since the September 2023 quarter – with a steady market share of 15.4% and almost $16.7 billion in funds under management.
The gap between the two biggest funds is shrinking as Morningstar reported in the December quarter that ANZ had a 19.5% market share and Fisher Funds had 15.4%.
ASB came third in Morningstar’s market share analysis of the March 2024 quarter, at 15.3% and with $16.6 billion funds under management.
In 2023, ASB held the second largest market share according to Morningstar until September 2023 when it lost that spot to Fisher Funds.
Bunkall noted Milford was “sandwiched” between ASB and AMP in fourth place, with AMP ranking as the fifth largest fund in the March quarter.
The top five KiwiSaver providers hold about 68% of the assets in Morningstar’s database and contribute roughly 69% of the fees.
Bunkall said KiwiSaver funds spanning multiple sectors all yielded positive returns throughout the March quarter, particularly those including risk assets.
The average multisector category returns ranged from 2% for the conservative category to 8.8% for the aggressive category.
Default fund options returned an average of 5% in the three months to March.
Across a 10-years benchmark which is Morningstar’s preferred long-term performance measurement, Bunkall said the aggressive category average has given investors an annualized return of 9.1%.
Next in line came the growth category, giving an average return of 8.4%, followed by the balanced category at 6.8%, the moderate category at 4.8%, and the conservative category at 4.3%.
On an individual funds performance level, Fisher TWO Cash Enhanced and Fisher Funds Plan Default tied with QuayStreet Conservative for best performing fund in the conservative category in the March quarter, with all three up 2.6%.
Generate Moderate was up 4.1% in the moderate category and QuayStreet Socially Rspnb Inv was up the most in the balanced category at 7.5%.
In the growth category, the QuayStreet Growth fund had the best performance and was up 9.3% across the quarter.
Generate Focused Growth Fund rose 11.4% and was the top performing fund in the aggressive category.
Morningstar reported an estimated $849 million in annual fees in the March quarter, which is up almost 3.8% from $818 million in estimated annual fees in December.
‘Cautious optimism’
Bunkall said the first quarter of 2024 saw a “cautious optimism” in global markets.
On the inflation and interest rates front, Bunkall said central banks, including the Reserve Bank (RBNZ), took a “wait-and-see approach” and maintained interest rates at the same level.
“This signaled some progress in taming inflation, although concerns remained,” he said in Morningstar’s March 2024 quarter report.
Bunkall added that the US economy continued to be a bright spot, with consumer spending fueling growth.
The eurozone showed signs of recovery, particularly in manufacturing. However, New Zealand's growth was expected to be slow due to the lagged effect of higher interest rates.
During the quarter, the US economy “continued to be a bright spot”, driven by robust consumer spending and Bunkall said the eurozone had also begun to show signs of recovery, especially in its manufacturing sector.
In contrast, NZ’s growth was anticipated to be sluggish due to the “lagged effect” of higher interest rates.
“While inflation remained a concern, global growth prospects improved, and equity markets delivered strong returns, particularly for unhedged holdings due to the weaker NZ dollar,” Bunkall said.
2 Comments
"Bunkall noted Milford was “sandwiched” between ASB and AMP in fourth place, with AMP ranking as the fifth largest fund in the March quarter."
On page 16 of the March 2024 Morningstar report it displays the ranking of KiwiSaver Providers sizes.
ASB is ranked at 3rd, BT (Westpac) at 4th, Milford at 5th and AMP at 6th, not sure what Bunkall was looking at.
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