KiwiSaver returns pull back in March quarter
29 Apr, 2021 01:10 AM
3 minutes to read
Conservative KiwiSaver funds plunged into the red during the March quarter. Photo / 123RF
KiwiSaver returns have pulled back in the first three months of this year but the amount of money invested in the retirement savings scheme continued to grow, closing in on $79 billion.
Research from Morningstar shows most conservative funds plunged into the red during the March quarter after bond yields rose, resulting in capital losses for many bond investments.
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Conservative funds typically have the highest percentage in bond investments.
The average return for conservative funds was negative 0.6 per cent with the worst performing fund - Simplicity s conservative fund - falling 2 per cent over the quarter.
Australian shares tipped to outperform globals in 2021
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Australian investments could outperform overseas markets this year because of the country’s aggressive handing of the coronavirus to keep the economy afloat and government financial support that has enabled consumer spending to bounce back quickly.
David Bassanese, chief economist at Exchange Traded Funds provider BetaShares, says of all of the economic recovery scenarios, a “V-shape” appears most likely for Australia and for the world as vaccines are rolled out.
“In terms of all the scenarios we had prepared for, it’s turning out that we are close to a best-case scenario, with a lot of positives to consider,” he says.