KiwiSaver Workshops
26th September 2007 10:28AM
Investment Buyer Beware - KiwiSaver Scheme Selection
Kiwisaver has attracted numerous commentators, addressing either the logistics of implementation or elementary scrutiny based on tax benefits or basic fee comparisons. While these criteria play a role they fail to adequately address the inescapable fact that we need to choose a particular product by focusing on things that matter most, rather than things that are perhaps easily seen.
To develop an appreciation of what really matters and to relegate the market noise of promises, brand marketing and industry rhetoric will be useful both initially and in ensuing years given the power vested in employees to change providers at any time.
Essentially we have the same actors but a different play. NZ and Australian fund managers have been providing investors with unit trust investments (funds) for many years. They offer professional management, diversification and liquidity benefits, key priorities for fiduciary standards of investment. So what can we learn from the funds currently managed by the players now rolling out the Kiwisaver show? Interestingly, "quite a lot".
Rollins College (Florida), in association with fi360 (Australasia) Limited have addressed a number of vital issues and will present important findings in a seminar format suitable for professional firm partners, their valued business clients and financial advisors. The content will include;
Research evidence revealing the most important criteria to focus on
What does analysis of past performance tell us about the merits of active vs passive management approaches
Do fund managers invest in the way they promote
Why have many outcomes resembled "run of the mill" fixed interest results
If you choose the equivalent of a V8 sports car as your Kiwisaver ride, why is it some options may actually only deliver a 2 litre sedan experience and how different might the outcome be
Why will a "wait and see - change to the best performer" approach never work
Which managers, if any, have demonstrated superior added value
For those wishing to develop a deeper understanding you can download a copy of the comprehensive research paper, which provides insights into the analysis that underpins the seminar.
One of the major shortfalls for due diligence of funds in NZ is the lack of regulated disclosure for actual holdings and all layers of costs. Holdings are important in ascertaining whether managers have "earned their keep" on a risk adjusted basis. This paper reveals the answers to this riddle by replicating the well-known study by Brinson, Hood and Beebower (1986) and Ibbotson & Kaplan (2000) in explaining portfolio returns, but for a selection of 90+ funds available to New Zealand investors.
For more information on this 1.5 hr long seminar please register your interest here or contact:
fi360 (Australasia) Limited
Private Bag 12030
Tauranga
New Zealand
0800 360 000