Top KiwiSaver providers invest more in NZ shares

KiwiSaver providers with more money invested in the New Zealand share market beat the pack last quarter, according to Morningstar.

The fund research firm has released latest performance numbers for the three months to March 31 across the sector which is now worth over $18.75 billion.

Performance across the sectors ranged between 1.12 per cent and 1.54 per cent with balanced funds - those with a mix of investments in shares and fixed interest - having the strongest average returns for the period.

Chris Douglas, Morningstar co-head of fund research said there were stronger differences between the asset classes in the last quarter showing the importance of having a diversified portfolio.

"The Kiwi sharemarket notched up a healthy 8.52 per cent gain, while international shares was down 3.95 per cent.

"This was a significant turnaround on 2013, and a timely reminder of the value of a diversified portfolio."

The NZX-run Smartshares scheme was the best performer in the conservative and balanced categories.

While the Fisher Funds TWO scheme was top in Morningstar's aggressive growth category.

Mercer and Milford headed up the league tables in the growth and moderate categories respectively.

But Douglas said long-term performance was more important.

Over three and five years Aon KiwiSaver Russell and Mercer KiwiSaver have been the top-performing fund managers across the board.

Fisher Fund's Growth Fund has been the top performer in the aggressive category over five years and Milford has been the top performer in the balanced category since inception in 2010.

Despite this the biggest players remain the banks.

ASB and ANZ-owned OnePath have combined 46.6 per cent of KiwiSaver assets between them.