KiwiSaver Funds Recover from Middle East-Induced Volatility

KiwiSaver funds have recovered from the early-year market volatility caused by Middle East tensions, according to Morningstar's latest survey. The June quarter saw a $10 billion increase in KiwiSaver funds under management, reaching $147.7 billion.

The average returns for multisector funds ranged from 3.3% for conservative funds to 11.9% for aggressive funds. International equities delivered solid positive returns in New Zealand dollar terms, while New Zealand equities recovered but continued to lag global peers due to subdued domestic economic conditions and weak earnings expectations.

Morningstar noted that maintaining diversification across asset classes and regions proved valuable in participating in the rebound while reducing the risk of reacting to short-term market volatility. ANZ holds the largest share of the KiwiSaver market, at 16.3% with $24 billion under management.