OneAnswer KiwiSaver Scheme Conservative Fund

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

• The fund has a significant weighting to bonds, which make up over half of its holdings. Global government bonds had a mixed start to the year, with bonds in the US delivering strong returns, while those in several other markets faced headwinds.
• Despite a positive quarter, US bonds faced increased volatility, primarily due to trade policy news from President Donald Trump. His inconsistent tariff announcements led investors to consider the potential for reaccelerated inflation, which could negatively impact bonds, against the likelihood of a slower growth outlook, which would typically benefit bonds. Ultimately however, US bonds were higher due to a flight to safe-haven assets triggered by declines in equity markets.
• In Europe, bond markets were weaker. German government bonds fell, reflecting concerns about increased defence spending within the region being funded through an increase in bond issuance, while UK bonds faced similar concerns. Japanese government bonds were also lower, given growing expectations the Bank of Japan would increase interest rates due to a pick-up in local inflationary pressures.
• 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 fund has a modest exposure to equity markets. US share markets came under pressure, with technology shares particularly weak amid ongoing concerns about new AI developments and their impact on the sector, while other US markets fell on the back of tariff-related concerns. However, European equity markets showed resilience, with the Euro Stoxx 50 Index up a solid 7.5% and the UK’s FTSE 100 Index gaining 6.1%.

The fund aims to achieve (after the fund charge and before tax) over the long term low relatively stable returns, allowing for small 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 mainly in income assets (cash and cash equivalents and fixed interest), with a smaller exposure to growth assets (equities, listed property and listed infrastructure). The fund may also invest in alternative assets.

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