OneAnswer KiwiSaver Scheme Balanced Fund

Performance is after the annual fund charge and before tax. Legal information and disclaimers.

• Global share markets were generally weaker over the quarter, with US and New Zealand markets sharply lower. On a more positive note, many European markets delivered strong returns.
• US markets were weighed down by uncertainty surrounding the Trump administration’s trade policies, which include new tariffs on imports from China, on-again/off-again tariffs on Mexico and Canada, and the threat of retaliatory tariffs on many of its trading partners. The technology sector was the hardest hit as it also dealt with concerns about new AI developments and their impact on the sector. For the quarter, the S&P 500 Index fell 4.3%, while the Nasdaq 100 Index dropped 10.3%.
• European share markets showed resilience, however, with the Euro Stoxx 50 Index up a solid 7.5% and the UK’s FTSE 100 Index gaining 6.1%. Both regions benefitted from a continuation of interest rate cuts. In Asia, Japan’s Nikkei 225 Index was down 9.9% amid worries about US tariffs and their economic implications, while China’s Shanghai Composite Index fell only 0.2%.
• In New Zealand, the NZX 50 Index saw a decline of 6.4% over the quarter, underperforming many of its overseas counterparts. The market was dragged down by large caps, while mid and small cap stocks outperformed. And in Australia, the ASX 200 Index fell 2.8%, impacted by global market volatility and concerns over domestic economic growth. Its falls came despite the Reserve Bank of Australia finally beginning its rate-cutting cycle, as inflationary pressures fell back to within the central bank’s target range.
• The fund also has exposure to bonds. In international bond markets, US bonds were some of the better performing, largely driven by heightened volatility on the back of the Trump administration’s trade policies, while several European bond markets fell after concerns about increased defence spending in Germany that would be funded by bond issuance. Meanwhile, New Zealand bonds finished the quarter slightly higher. The 50 basis point cut to the Official Cash Rate (OCR) was fully priced into the market, and other economic data – namely inflation and unemployment – also came in largely as expected.
• The challenging start to the year for US equities was the main detractor on fund performance, while at a sector level, our infrastructure holdings offset some of the weakness in the broader US share markets. Also offsetting some of this weakness was the funds allocation to US bonds.
• We are neutral across global equities, global bonds and New Zealand bonds. Competing narratives continue to hinder high-conviction views. On the one hand, US equities appear to be supported by the pro-business and deregulatory policies from the White House. On the other hand, economic data appears to be weakening, while ongoing concerns around the impact of tariffs appear to be posing downside risks.

The fund aims to achieve (after the fund charge and before tax) over the long term moderate returns, allowing for moderate ups and downs in value.

The graph below shows the value of a $1,000 investment made at the time the fund launched.

Performance is after the annual fund charge and before tax. Legal information and disclaimers.

The fund invests in similar amounts of income assets (cash and cash equivalents and fixed interest) and growth assets (equities, listed property and listed infrastructue). The fund may also invest in alternative assets.

This chart shows the mix of assets that the fund generally intends to invest in.