Mercer

Member number: <Member Number>

Hi <First Name>,

In this newsletter, we have the latest edition of Investment Insights, an update on how the markets performed over the first quarter of 2024 and a behind the scenes interview with one of our financial advisers Jonny McNamee.

Investment Insights Q2 2024

During the first quarter of 2024, equity markets performed strongly, with standout performances from Japanese and US equities. Bond markets were relatively muted, and gold reached a new all-time high.

Hayden Tyrrell, Senior Investment Management Analyst, shares insights from Mercer’s global network of investment experts, covering:

•

How the markets performed in quarter one.

•

Current trends impacting global and local investment markets.

•

How an increase or decrease in the official cash rate can affect Kiwi investors.

•

Market trends we are likely to see this year.

Market Commentary – March 2024

(see below for a glossary of terms to break down the jargon)

In March, despite an increase in US inflation and a slowdown in consumer spending, stock markets continued to rise. The US Federal Reserve supported the market by confirming their projections to lower interest rates three times in 2024. Developed markets outperformed emerging markets, with the MSCI World Index returning 3.4%, and the MSCI Emerging Markets Index increasing by 3.0%. Japanese stocks also performed well as Japan’s era of negative interest rates and yield curve control policies came to an end. Value stocks performed better than growth stocks, and both New Zealand and Australian stocks had positive returns. New Zealand bonds performed strongly as growing expectations of rate cuts put downward pressure on bond yields (prices increased), with the Bloomberg NZ Bond Composite 0+ Yr Index returning 1.1%.

Glossary of Terms

Developed markets vs. emerging markets
Developed markets boast advanced economies, well-established infrastructure, mature capital markets, and higher standards of living. Emerging market economies refer to countries that are in the process of transitioning into developed market economies. These countries possess some, but not all, of the characteristics typically associated with developed markets.

MSCI (Morgan Stanley Capital International) World Index
The MSCI World Index is a global stock market index that tracks the performance of large and medium-sized companies across 23 developed countries. The index is used as a benchmark to measure the performance of stocks in developed markets.

MSCI Emerging Markets Index
The MSCI Emerging Markets Index tracks the performance of stocks from emerging market countries. It includes stocks from various sectors and industries in countries such as China, India, Brazil, and South Korea. The index is used as a benchmark to measure the performance of stocks in emerging markets.

The Bloomberg NZ Bond Composite 0+ Yr Index
The Bloomberg NZ Bond Composite 0+ Yr Index measures the performance of the New Zealand debt market, including various types of bonds with different maturity dates.

Investment Performance

See below how the Mercer KiwiSaver scheme funds have performed for the quarter and year to 31 March 2024. The investment returns shown are after fees and tax at 28%.

3‌ mo‌nths

1 yea‌r

Cash

0.98%

3.94%

Sustainable Conservative

2.12%

5.89%

Sustainable Plus Moderate

3.05%

7.23%

Sustainable Plus Balanced

4.56%

9.63%

Sustainable Plus Growth

6.24%

12.59%

Sustainable Plus High Growth

7.58%

14.68%

Sustainable Plus Shares

9.22%

16.92%

A full monthly report, including Mercer FlexiSaver and Mercer Super Trust fund’s performance, can be viewed here.

You can keep up to date about what’s going on in the market and with your account at www.mercerfinancialservices.co.nz.

Meet Jonny McNamee, a Financial Adviser in Mercer’s Advice Team

With two decades of financial services experience under his belt, Jonny brings a wealth of knowledge and expertise to his position as a Financial Adviser. Not only does he serve as a Business Process Manager, but he also provides invaluable advice to Mercer and Police Superannuation Scheme members.

Jonny’s day-to-day revolves around staying up-to-date on market trends, ensuring regulatory compliance, and offering guidance to members. When asked about the importance of speaking with a financial adviser, Jonny emphasised that financial products and investment decisions can often be confusing. Financial advisers, like himself, play a crucial role in simplifying complex information and asking the right questions to help individuals make informed decisions.

One of the most frequently asked questions from Mercer members is, “Am I in the right investment option?” Jonny’s response highlights the significance of considering one’s investment timeframe when making such decisions. Understanding your timeframe allows you to determine the appropriate level of risk to take.

What Jonny enjoys most about his role as a Financial Adviser is the opportunity to add value to people’s lives through advice and education. He finds great satisfaction in helping members understand their financial situations and make appropriate decisions. It’s no wonder that most advice calls end with members expressing their appreciation for Jonny’s time and guidance.

For those preparing for retirement, Jonny’s top tip is to start early and periodically consult with a Financial Adviser. Even a brief conversation can shed light on risks that may have been overlooked, potentially saving you from costly mistakes.

Outside of work, Jonny is an avid golfer, although he humorously admits that it’s debatable whether golf truly helps him unwind. He also keeps busy and highly entertained by his 8-year-old son and 10-year-old daughter.

Need advice? Our Financial Advice team is here to help you decide what investment fund is right for you.

You can find out more about our advice service in the Mercer Financial Advice Provider Disclosure Statement. You can request a member of our financial advice team to call you by completing an online ‘Request a Call Back’ form.

Get in touch ›

Scheme reminders

KiwiSaver Government contribution

If you are a member of the Mercer KiwiSaver scheme it is a good time to check if you are eligible for the Government contribution. Please check that you are on track to contributing $1,042 into your KiwiSaver account before 30 June 2024, to ensure you receive the maximum amount (maximum of $521 p.a). You can see how you are tracking by logging into your myIR account at www.ird.govt.nz. To read more on Government contributions, click here.

There are a number of ways you can get in touch with Mercer.

Online: Update your details, review your investment options or check your balance online here.

Call: 0508 637 237 (+61 3 8306 0971 if calling from overseas) from 9am - 7pm Monday – Friday.

Advice: Our financial advice team is here to help and available by calling 0508 637 237.

Kind regards,
Mercer Team