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C & D

Investment Performance

Annuities – Who is the Winner?

Increasing numbers of people who are members of KiwiSaver schemes are becoming eligible to access their savings. This is because they have reached the age of sixty five. Some of these people have significant amounts of funds. There has been some debate on what they should do with the monies. One option that has been talked about is to buy an annuity.

Invariably the Volatile Quarter

It seems that the third quarter of each year is a volatile one for investors. The quarter that has just been has been no exception. There are always explanations as to why it can be an up or down period.

What to Do with KiwiSaver Proceeds in Retirement

One of the challenges for KiwiSaver scheme members when they reach the age of sixty five is: should they continue to contribute to the fund, and or stay invested in the fund. Provided one is still in paid employment and can afford to save, then there is nothing lost by continuing to contribute to the fund. A generous employer may even continue to make employer contributions. What you will miss out on is the government’s ongoing contribution.

Low Interest Rates – the Reality

Interest rates in New Zealand are close to record lows with the Official Cash Rate (OCR) currently set at 3%. The OCR is still slightly higher than what it was in December 2011. That’s good news as it leaves the possibility of further interest rate cuts to stimulate the economy if needed. If it is needed, it will primarily be because of the impact of low dairy prices flowing through the economy. Remember, Fonterra is only working on forecasts. It’s the actual returns that will really matter.

Have the Markets really changed?

Over recent days there has been a lot of share market volatility around much of the developed world. The Chinese share market has seen large daily moves. Similarly, in the USA, the Dow has seen major moves both up and down within a single day’s trading.

On the face of it, it seems that the market is over reacting dramatically to any glimmer of economic news or political statement. What we are seeing is probably a combination of factors that have come about largely through technological change. Hedge funds dominate the major markets.

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