A major turnaround in the New Zealand and international sharemarkets in the last six months has boosted the performance of KiwiSaver growth funds, according to a survey by research house Morningstar.
Growth funds, which mainly invest in assets like shares and property, were hammered by the global financial crisis during 2007 and 2008 but for the six months to September 30 their average performance has been nearly triple that of the average conservative fund, which invests mainly in cash and bonds.
The average conservative fund was up 6.26% while the average growth fund was up 17.24% and the average for more aggressive growth funds was 21.83% over six months.
Morningstar fund analysis manager Chris Douglas said the last six months showed how quickly markets could turn around.
Anyone who had decided to switch into a more conservative fund would have missed out on the rally, which had seen the New Zealand share market rise 22% and the Australian market 35.5% in the last six months, he said.
Over the two years since fund managers began investing KiwiSaver money, conservative funds have had an average return of 3.63% per annum.
The top conservative fund over two years was the tiny $3.6 million Grosvenor KiwiSaver Enhanced Income fund, which had an average of 6.97% per annum, followed by the $232 million ING Conservative fund, which had 4.16% per annum and is one of the Government's six default schemes.
Huljich Wealth Management - which has been in the spotlight recently for its KiwiSaver selling practices - topped the performance tables for the moderate, balanced and growth categories.
Brook Asset Management's Growth fund was the top performer in the aggressive growth funds with 4.57% per annum.
The top-performing fund for all KiwiSaver funds was the Aon Milford Aggressive fund, which invests in Australian and New Zealand shares and returned 12.94% per annum.
Mr Douglas said the fund had benefited from having a high level of investment in cash, which meant it had fended off the worst of the global financial crisis, but its performance had not been able to compete in the last six months with those who had more money invested in growth assets.
The worst performer was the ING SIL International Property Fund, which fell 24.05% per annum over the two years.
Mr Douglas said the fund's performance reflected the hammering of global property assets over that time.
Gareth Morgan's funds, which were included in a KiwiSaver survey for the first time, came out at the bottom or close to it in every category they are in over one year.
KiwiSaver performance over two years to September 30
Conservative: Grosvenor Enhanced Income Fund, 6.97% per annum
Moderate: Huljich Conservative Diversified KiwiSaver Fund, 11.34% p/a
Balanced: Huljich Balanced Diversified KiwiSaver Fund, 8.24% p/a
Growth: Huljich Growth Diversified KiwiSaver Fund, 7.7% p/a
Aggressive growth: Brook Professional Growth Fund, 4.57% p/a
Full performance charts at www.morningstar.net.nz