For the second consecutive quarter growth funds are the stand out performers in a survey of KiwiSaver funds by Mercer.
Balanced and growth funds are well on the way to reclaiming the losses experienced through the global financial crisis, says Martin Lewington, head of Mercer in New Zealand.
At September 30 there were 1.2 million KiwiSaver accounts with $4.25 billion invested in them.
Growth funds produced a median return of 10.8% in the September quarter. The best performing growth fund over the quarter was the Fisher Funds Growth Fund, with a 15.2% return.
Growth funds tend to have the highest exposure to shares and property.
The best performing default fund in the quarter was Mercer KiwiSaver Conservative Fund with a 6.5% return. Default funds are the best performers since the inception of Kiwisaver funds.
"In the last six months balanced and growth funds have pegged back approximately half the losses experienced through the global financial crisis," Lewington says.
"This result is in stark contrast to the previous 12 months in which only conservative funds, on average, provided a positive return for KiwiSaver investors."
The best performing conservative fund over the quarter was the Mercer Conservative Fund with a rise of 7.3%, while the AXA Conservative Fund was the best performing over the last 12 months with a rise of 8.5%.
The best performing balanced fund over the quarter was the Mercer Active Balanced Fund with a rise of 10.9%.
Even as the growth in membership abates, investment returns, member contributions, employer subsidies and government tax credits will ensure funds under management continue to grow at a rapid pace, says Lewington.
