Fund watch
How has each SIL fund performed?
| SIL Mutual Scheme Performance as at 31 December 2022 |
3 months (%) |
1 year (%) |
3 years (% p.a.) |
5 years (% p.a.) |
10 years (% p.a.) |
| SIL Cash Plus Fund | 0.87% | 1.94% | 1.06% | 1.43% | 1.92% |
| SIL Balanced Plus Fund | 3.45% | -13.41% | 2.04% | 4.38% | 7.35% |
| SIL New Zealand Fixed Interest Fund | -0.01% | -7.61% | -2.35% | 0.25% | 1.75% |
| SIL New Zealand Share Fund | 4.32% | -12.90% | 0.33% | 6.51% | 10.76% |
| SIL International Share Fund | -0.69% | -14.21% | 5.42% | 7.76% | 11.35% |
Performance is after annual fund charges and before tax.
In local currency terms, international equity markets finished the quarter higher, as inflation rates in many developed nations slowed, raising hopes the end of the global central bank tightening cycle may be near. However, in New Zealand dollar terms, they fell, as our currency strengthened against most other ones. The kiwi dollar tends to outperform when investor risk appetite is improving. Against this backdrop, the SIL International Share Fund fell 0.69%.
New Zealand equities fared better, ending the quarter higher, but still faced headwinds as the Reserve Bank of New Zealand (RBNZ) continued its hawkish tightening of monetary policy. The interest rate-sensitive NZX 50 Index delivered a gain of 3.7%. At a sector level, consumer staples were the best performers, while consumer discretionary were the worst, reflecting the likelihood that households will scale back on their non-essential spending as the economy heads for a potential recession. Over the quarter the SIL New Zealand Share Fund gained 4.32%.
New Zealand bonds held up relatively well, despite two sizeable rate hikes by the RBNZ, as it raised the Official Cash Rate (OCR) by a total of 125 basis points to 4.25%. New Zealand bonds were driven both by local and global forces. On the one hand, higher-than-expected inflation, alongside robust retail sales and economic growth data, saw sharp declines in local bond prices. However, these sell-offs were met with market rallies following lower-than-expected inflation readings in the US. The SIL New Zealand Fixed Interest fund fell 0.01%. Meanwhile, cash delivered stable and positive returns, with the SIL Cash Plus Fund up 0.87%.
The SIL Balanced Plus Fund has around 65% of its holdings in growth investments, such as international shares, with the remaining 35% in income investments, such as bonds and cash. Benefiting performance was its overweight to international equities during a time when these outperformed. We later moved to an underweight position, ahead of their subsequent falls. Strong performance from our underlying international equity managers also helped. The fund returned 3.45%.
This article has been prepared by ANZ New Zealand Investments Limited for information purposes only and it should not be treated as financial advice.
Superannuation Investments Limited is the issuer and manager of the SIL Mutual Scheme. ANZ Investments is not an authorised deposit taking institution (ADI) under Australian law and investments in the scheme aren't deposits in or liabilities of ANZ Bank New Zealand Limited, Australia and New Zealand Banking Group Limited, or their subsidiaries (together 'ANZ Group'). ANZ Group doesn’t stand behind or guarantee ANZ Investments. Investments in the scheme are subject to investment risk, including possible delays in repayment, and loss of income and principal invested. ANZ Group won’t be liable to you for the capital value or performance of your investment.
Past performance does not indicate future performance, and performance can be negative as well as positive. This material is for information purposes only. We recommend seeking financial advice about your situation and goals before getting a financial product.
Investment and administration manager: ANZ New Zealand Investments Limited