What a difference a year makes

This time last year we were locked down in our homes, wondering what the future holds as the world grappled with a virus we have become all too familiar with now. Financial markets do not like uncertainty and had reacted violently to the fast-spreading virus, lockdowns across the world and the uncertain future for the global economy.

After reaching new highs during February 2020, share markets across Europe, the US and locally dropped 30 to 40% to reach a low point on the 23rd of March and we reported negative returns on your KiwiSaver Funds of between -5% and -12% for the month and returns between -2.1% and +1.75% for the 1 year to the end of March 2020.

Twelve months later we are still dealing with the disruptive and sometimes distressing impacts of the global pandemic. However, financial markets have recovered extremely well, supported by unprecedented central bank support and KiwiSaver Funds have benefitted as a result. Milford KiwiSaver Funds (excluding the Cash Fund) have provided returns of between 0.8% and 3.3% in March 2021 and 10.6% and 42.5% for the past year.

The lesson from this is, members who stayed the course and stuck to their long-term investment strategy rather than reacting to market movements a year ago have been rewarded for their resilience.

For most people, KiwiSaver is a long-term investment and should be left to ride out the ups and downs of markets. If you are not sure what your appetite for risk is, or whether you are in the right KiwiSaver fund you can use our KiwiSaver Digital Advice tools in the client portal.