Why long-term performance matters


Generate Contributor


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There is no doubt 2022 has been rough for markets, with covid-19, geopolitical tensions and inflation continuing to drive volatility.

And, while we know, it can be uncomfortable to see the impact of the current market volatility on your KiwiSaver account, it’s important to remember that market volatility is normal. And the best thing you can do is stay calm and stay the course.

Markets can go up and down for all kinds of reasons. And KiwiSaver funds are diversified across different asset classes, companies, sectors and countries, which don’t all move in the same direction at the same time.

Thankfully, history shows that over the long-term markets generally trend upwards - and any downturns tend to be short-term occurrences.

In fact, over the last 30 years, the S&P 500 increased by 1,703%, (or 10% per year) despite many market dips and blips. That’s why all market commentators generally recommend that staying put and playing the long-term game will leave investors better off.

It’s also worth remembering that KiwiSaver is a long-term investment – and so, long-term performance is more important than any short-term returns (or losses).

How Generate funds compare for long-term performance

While all KiwiSaver and investment providers have been impacted by market volatility recently, we're proud to still be one of the best-performing KiwiSaver providers for long-term performance (after all, KiwiSaver is a long-term investment).

The latest data from independent KiwiSaver observer, Morningstar, shows Generate funds have continued to rank as top performers in their respective categories to 30 March 2022:

Focused Growth Fund: 2nd for 5-year returns

Out of 11 funds
In the Morningstar KiwiSaver Multi-sector Aggressive category²

Growth Fund: 4th for 5-year returns

Out of 27 funds
In the Morningstar KiwiSaver Multi-sector Growth category²

Moderate Fund: 1st for 5-year returns

Out of 21 funds
In the Morningstar KiwiSaver Multi-sector Moderate category²
(Note: the Moderate Fund was previously called the Conservative fund, but was renamed Moderate on 16 May 2022, when Generate launched new funds)

What's more, our Focused Growth Fund has consistently ranked in the top three Aggressive Growth KiwiSaver funds for 5-year returns, every quarter since it was first eligible in June 2018!

A volatile market presents both opportunities and risks. Because we are ‘active fund managers’, we research and study the markets every day and adjust our fund investments to take advantage of opportunities that a volatile market presents.

We're proud that this investment strategy continues to deliver strong long-term performance in comparison to other providers.

If you are comparing funds based on historical returns it is important to compare long-term returns, as these will give you a better assessment of how each KiwiSaver fund performs.