Another positive quarter ensured that solid returns were reported for each of the funds in the quarter ended 30 June 2018. The benefits of diversification were evident with lower returns on bonds being more than offset by exceptional returns for shares. Christian KiwiSaver Scheme also invests in unique asset classes like forestry, mortgage loans to Christians and select private equity investments which over the long run have further diversified and enhanced returns.
Whilst many uncertainties exist, the mood remains upbeat – particularly in the US where corporate profits are strong – and positive sentiment may continue for a time yet despite the reported potential for trade wars, higher inflation and reduced growth. Other significant influences in the quarter included ongoing Brexit discussions, political developments (e.g. the Italian election), and denuclearisation dialogues. Given the many uncertainties and current elevated asset price levels we continue to invest cautiously with a focus on quality assets, i.e. those that have a greater chance for preserving capital whilst also providing a fair return on that capital.
Investment returns at 30 June 2018, before fees and tax: