Investment
1 mins to read
The New Zealand Superannuation Fund has continued to recover from its recession low, delivering a return of $358 million in December.
This represents a 2.40% return for the fund, which was set up by former Finance Minister Michael Cullen to help fund the New Zealand government’s future superannuation costs.
The total value of the fund was $15.96 billion as at December 31.
From July to December the fund gained 17.44%, a $2.36 billion increase, after world equity markets bottomed out and managed funds began to recover at various speeds depending on their asset allocation mix.
The New Zealand Superannuation Fund was not immune to the market struggles up until that point, down 22.14% in the year to June.
But while it has gained strongly since then the fund is still slightly below its long-term target of exceeding the rate of return on Treasury bills by 2.5% over rolling 20-year periods.
It currently trails its target by 0.06%.
Since its inception in 2003 the fund has received $14.88 billion from the government.
The biggest chunk of the fund, $5.7 billion (35.9%) is invested in international large cap equities.
Next up is international fixed income with a 16% asset allocation ($2.6 billion), while the third biggest investment is in timber, with nearly $1.2 billion tied up in trees.
National wants the fund to increase its proportion of assets held in New Zealand to 40% but reaching this target still looks a long way off.
Currently the fund holds only 7.1% of its assets in New Zealand equity, 1.2% in New Zealand fixed income and 1.7% in New Zealand property.
Niko Kloeten
Thu, 21 Jan 2010
Thu, 21 Jan 2010
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NZ Super Fund nears $16 billion, closes in on target
Investment,
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