Managed funds continuing good returns on growing equity markets

By NZPA

Thursday 24th June 2004

Investors in managed equity funds continued to enjoy good gains as local and international equity markets grew overall in the year to May 31 according to investment research company FundSource.

FundSource general manger Tim Anderson said investors were seeing "significant positive performances in their equity funds, following what have been recent record increases in performance".

"International equity funds saw solid growth of over 12% in the year to May 31, 2004 while leading the way again were New Zealand equity funds, with active funds increasing 16% and their passive counterparts growing a creditable 18%," Anderson said in a statement.

Despite a flat May, New Zealand equity markets continued to be extremely strong, Anderson said, " reflecting a persistently buoyant New Zealand economy".

"With an economy continuing to be stronger than many commentators expected, it has translated into higher company profits and ultimately, higher company values," Anderson said.

Active New Zealand equity funds on average returned 16% for the year.

Best performing among these funds Fisher Funds NZ Growth ad 22.54% for the year, and AXA Australasian Selected Equities at 16.72%.

Anderson said all New Zealand equity funds reported returns of over 13% for the year.

Anderson said global shares gained by 9% over the period as measured by the MSCI World Free Gross index, but international equity funds on average gained 12%.

Affinity Healthcare Worldwide Growth fund rose 22.66% for the year and other solid performers included BNZ International Equity Fund with 18.73% and the ANZ World Equity Trust with 16% returns.

Anderson said international equities had enjoyed a very positive period since March last year with corporate and economic activity strengthening across the board.

"These latest positive figures show we are past the turnaround stage and have now entered a period of consistent returns."

Meanwhile, diversified funds, the largest New Zealand managed fund sector with over $7 billion of New Zealanders money invested, recorded average returns of 7.93% over the year.

Growth orientated diversified funds performed better with average returns of 10.08% for the year. Defensive diversified funds showed 4% average returns for the year.

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