Investment
KiwiSaver started back in 2007 so has been available to eligible Kiwis for 16 years. However, average balances remain worryingly low at only $27,379* with many Kiwis not currently contributing. While the current cost of living crisis may have forced some to prioritise
By Shahrukh Abdali, CFA
Most share markets had a materially negative quarter after a strong first half of the year. This was largely driven by investors pricing in the higher rates remaining high for longer than previously anticipated as inflation appeared to be bucking the downward trend.
One of the big stories in health (and markets) in 2023 has been the new GLP-1 agonist class of drugs. Ozempic was the original blockbuster medication for Type 2 diabetes sold by Danish company Novo Nordisk. Then came Wegovy from the same company, which contains the same active ingredient but is FDA approved for chronic weight management. Novo Nordisk’s share price has increased by 36% since January this year and its operating profit is up 32%. The major limiting factor is the company’s ability to keep up with the huge demand and addressable market.
By Shahrukh Abdali, CFA
The World Bank expects the global GDP growth to decline to 2.1% in 2023 down from 3.1% in 2022. The main reason cited for this downward revision is the lagged impact from the monetary policy tightening implemented by most central banks across developed economies. The World Bank expects GDP growth to start to recover in 2024.
“Gutted’ pensioner loses $150k in bogus HSBC-branded ‘eco bond’ investment scam”
“No red flags. Heartbroken realty agent loses $100k in elaborate finance scam”
By Shahrukh Abdali, CFA
Most share markets had a surprisingly strong start to the year, albeit with heightened volatility. January was one of the strongest months for share markets since 2020 driven by hope that the worst of the current downturn may be in the rear-view mirror. However, the higher-than-expected US inflation rate for January brought the realisation that we are not out of the woods yet. During March, investors saw the ghosts of the Global Financial Crisis in 2008 with two regional banks failing in the US followed by a forced merger of Credit Suisse into UBS. Despite the turmoil, share markets managed to close out the quarter materially positive
On the surface, the interest rates on term deposits look pretty good, certainly better than they have been for many years. They also look better than the short-term returns from residential property or a diversified portfolio as these assets have generally been repriced downwards because of rising interest rates and other factors.
2022 was brutal for investing with many investment markets significantly lower at the end of the year than they were at the start. Take your pick. The New Zealand share market was down 12%. Globally, share markets were down by a similar 11.4%. Fixed interest investments didn’t fare any better. Our local fixed interest market was down 7.8% and the global equivalent was down 11.7%. Even worse, local and global listed property trust indices were down by more than 22%. New Zealand residential property, the “go to” investment for many Kiwis, wasn’t immune either.
By Shahrukh Abdali, CFA
Most share markets closed the year significantly lower than the start of the year. While it has been a challenging year for investors, it is worth noting that the negative performance in 2022 was preceded by the strongly positive 3-year period of 2019-21.
2022 has been one of those years where markets have moved a lot and mostly in a downward direction. There haven’t been many places to hide with shares, property and fixed interest markets all falling. Many share markets have been in “bear market” territory falling more than 20% from their peak in the last 12 months. This is not in itself unusual. In the US, the S&P 500 index has been in a bear market 22 times in the last 94 years.
Historic market returns for the month of December show there is some basis to the Santa Claus rally.
The rally typically occurs over the last five trading days of the year and the first few of January. First identified by Yale Hirsch in 1972, the S&P 500 had gained an average 1.5% across those days from 1950 to 1972. Since then, the gain has occurred in 75% of subsequent years.
By Shahrukh Abdali, CFA
Most share markets had a rollercoaster of a quarter starting with a strongly positive July and ending with a deeply negative September. Overall, the declines later in the quarter dominated to result with
It has been a grim year in investment markets where overcooked asset prices have rapidly deflated. No asset class has been spared. We expect equities to be volatile but bonds, which theoretically cushion us through equity sell offs, have added to the pain. Property prices are also correcting.
Many clients use their portfolios to provide a regular monthly income throughout retirement. Others prefer to take lump sum withdrawals from time to time and yes we do hope to see cruise ships berthed at Princes Wharf again soon!
By Shahrukh Abdali, CFA AFA.
Most share markets continued to decline through the quarter to record the worst performance in decades for the first half of a year. Although the current drawdown is still not the deepest in terms of the decline from the last peak, it is one of the most widespread affecting almost all sectors and most geographic regions.
Biotechnology was the red hot investment sector of 2020 as new mRNA technology was harnessed to develop Covid 19 vaccines in record time. Since peaking in February 2021 the healthcare sector and biotechnology in particular, has been ‘a dumpster fire’ according to one commentator, significantly underperforming the S&P 500 index.
By Peter DIne.
The Climate and Energy Finance Group from the University of Otago has just released a research report on the responsible investment (environmental, social, governance; ESG) policies and strategies of global equity funds available to Australasian investors.
It has been rough start to 2022 for financial markets following a year where many share markets such as the US reached record highs.
On 17 August New Zealand registered a community case of the delta strain of Covid 19 and re -entered a Level 4 lockdown. On 5 October Auckland received modest relief with a “lighter” version of Level 3 but the lockdown is still very restrictive with restaurants, hairdressers and gyms still closed. Across the ditch New South Wales, ACT and Victoria are dealing with their own versions of lock down but hopefully seeing the light at the end of the tunnel as vaccination rates rise.
By Lance Dawber-Ashley, Financial Adviser – 24 June 2021 Covid-19 has affected all of us in one way or another. Naturally, we’ve focused on how it has affected the livelihoods, health and wellbeing of ourselves and the people around us, but it has also impacted…
One of the advantages of an investment portfolio with Saturn is the ease of setting up a regular payment or withdrawing a lump sum from your portfolio.
The subject of fees can be a distraction when it comes to deciding whether or not to seek financial advice. No question, fees are an important consideration, but like most things in life its more about getting value for money.
By Peter Dine 23rd June 2020 Responsible investing has historically been the domain of groups or individuals with very strong ethical views governing what they will (or more likely will not) invest in. Socially Responsible Investing and Ethical Investing are sometimes terms used to describe…
Its always a good time to invest for your future. However, this needs to be qualified because the answer is a personal one.
By Steve Baker, Authorised Financial Adviser, 22 April 2020 It is a perfectly normal human emotion to feel concerned or even stressed during times of extreme share market volatility, as we have been experiencing during the last couple of months because of Covid-19. After…
As markets grapple with a government mandated shut down of economic activity in response to Covid 19 it is interesting to look back at previous market crashes to put this one into perspective.
By Alister Pirie, AFA Based on my experience as a Financial Adviser over the past 31 years, financial advice firms usually receive strong inflows of funds leading into a market correction or crash. Many potential investors sit on the side-line watching equity markets rise during…
By Jean Strock AFA We are experiencing a classic Black Swan event in the markets, defined as an event that is unexpected, has a major impact and is difficult to predict. Certainly we never foresaw New Zealand being in a state of emergency and…
POSTED ON 9/1/2020. ARTICLE BY PETER DINE When it comes to financial advice, one of the most common questions we get asked by prospective clients is “how much will it cost”. It’s a very valid question. After all, as an impartial and fee based…
The Westpac Massey University Fin Ed Centre has released its 2019 New Zealand Retirement Expenditure Guidelines showing a continuing shortfall between NZ Superannuation and actual household expenditure. A two person household in provincial New Zealand had the smallest income gap while households in Metropolitan areas…
By Jean Strock, AFA KiwiSaver schemes have been successful in getting Kiwi’s engaged with and actively saving for their retirement. The FMA KiwiSaver Annual Report 2019 identified 2.9m people invested in KiwiSaver schemes as at March 2019 with total funds under management of $57bn,…
POSTED ON 16/12/2019. ARTICLE BY PETER DINE Did you know you can actually get a negative return from fixed interest investments? After all, they are supposed to be the safe part of an investor’s portfolio! Well generally they are, but it’s important to understand the…
Most of us would like to think we make rational investment decisions, right? Well here’s a chart courtesy of Russell Investments suggesting the opposite happens in practice. The area circled on the right hand side shows a big dip in the US share market in…
POSTED ON 21/08/2019. ARTICLE BY PETER DINE “There’s no news like bad news”. Elliot Carver, media mogul and villain in the 1997 James Bond Movie, Tomorrow Never Dies. There’s no shortage of commentary on the state of the global economy and markets. And there’s…
This article is last of a series aimed to address some of the common questions regarding investing in New Zealand residential property. I hope the information provided will be useful to readers when contemplating financial decisions. Note the information provided is not personalised financial advice…
Through our financial advice and portfolio management we help our clients to make money, but on its own money is just a ledger entry or a pile of notes and coins. It is how money enables us to live the life we want that counts….
If you’ve been following the financial press you may have read about the Royal Commission and its review of misconduct in the banking, superannuation and financial services industry in Australia. You may have also heard about the Reserve Bank (RBNZ) and Financial Markets Authority (FMA)…
KiwiSaver started on 1 July 2007 yet already there is a significant gap between the balances of men relative to women and this gap is growing rapidly.
For many New Zealanders the perennial favourite places to invest are residential property (own home and rentals), and term deposits. Statistics from the RBNZ show that house-holds collectively invested $174bn in deposits with registered banks as at September 2018.
This is an often asked and loaded question, a bit like asking how long is a piece of string, and the answer is “it depends….” It depends on a lot of factors including what your future goals and investment objectives are. Without delving into specifics there are a couple of principles worth exploring.
Platinum Presentation to Saturn Clients, 1 August 2018 By Peter Dine, General Manager There is no shortage of people trying to predict the down turn of stock markets. A quick google search is a testament to this. Furthermore when it comes to financial markets,…
By Jean Strock, AFA Several Saturn advisers attended the 2016 Responsible Investment Association Australasia (RIAA) conference, conveniently located opposite the Auckland office at the Hilton Hotel. The two key note speakers at this year’s conference were Simon Mackenzie the CEO of Vector Energy and Bronwyn…
For many years ethical or responsible investment was synonymous with poor returns. Multiple studies now show that conforming to Environmental, Social and Governance (ESG) principles can have a positive impact on a company’s financial performance. How can ESG factors improve investment performance? ENVIRONMENTAL: attention to…
27 June 2016 The decision by the British people to withdraw from the European Union (EU) took markets by surprise. Yet, it did not occur in a vacuum. Britain’s vote to leave the EU needs to be seen in the context of a confluence of global…
Britain’s decision to exit the European Union (“Brexit”), followed swiftly by UK Prime Minister David Cameron’s resignation, creates considerable economic and political uncertainty. It will be some time before we know all the answers. The negative market reaction to the narrow victory (52% vs 48%)…
By Jean Strock, AFA The World Economic Forum estimates that there is a global spending deficit of USD1 trillion per year (and growing) on basic infrastructure such as power, water, transport and communications. This applies to both developed and emerging economies. India is one country…