The average fund manager outperformed their respective benchmarks in all bar one asset class over 2015, according to the latest Aon Hewitt NZ investment survey.
Global fixed income managers were the only group covered in the Aon survey that underperformed the index during the 2015 calendar year with the median fund returning 3.8 per cent compared to the Barclays Aggregate Bond benchmark return of 4.5 per cent.
Guy Fisher, Aon investment consultant, said think the sub-par performance of global fixed income funds was probably down to “an over allocation to credit in the search for additional yield”.
Over both the three- and five-year periods the median manager outperformed the index in all asset classes, the Aon report shows, albeit by a slim margin in some cases.
Aon reports returns before management fees and tax with offshore sectors denominated in NZ dollars (hedged for fixed income and property but excluding currency effects on equities).
Australasian property and equities were the equal best-performing sectors in the 12 months to end December 2015, with the median manager in both asset classes returning 15.6 per cent for the year. (Aon measures Australasian shares and property against NZ-only benchmarks – the NZX50 Gross and NZX Property, respectively – with both indices recording returns of 15.1 per cent over 2015.)
The $5 million Nikko Australasian Smallcap fund topped the Australian and NZ share sector, returning 24.6 per cent in 2015 with the $746 million ANZ Australasian Equity fund coming in last of the 21 products in the field, recording gains of 10.2 per cent for the year.
Of the seven pure NZ equity funds in the Aon survey, annual returns ranged from 20.7 per cent for Milford to ANZ’s 10.3 per cent.
Global equity funds had a horror month in December, the Aon report shows, with the best-performing manager (MGH Investments) recording a loss of -3.5 per cent and the worst-performer (Russell Emerging Markets) down -7.3 per cent over the 31 days.
“… but [global equity funds] mostly posted solid returns over the year. The median fund returned 15.0 % in 2015,” the Aon report says. “Bond funds were mostly flat or negative in December and posted modest returns for 2015. Domestic bonds outperformed international bonds in 2015.”