Markets will recover, they were told
New Zealand’s biggest KiwiSaver provider has received a flurry of calls from investors anxious about the steep plunges on global share markets.
ANZ Investments said the calls it had taken in the past week were as many as the whole of May and calls were 20% up on normal, with inquiries about volatility, falling account values, and whether to switch funds.
Read next: ANZ Bank appoints new investment leader
Fiona Mackenzie, ANZ funds management head, said that while the heightened concerns were understandable, investors should keep calm and take a long-term view.
“The queries we are getting are focused around similar themes: market fluctuation, the value of individual investments, and whether to switch funds," Mackenzie told RNZ. “But it is important investors remember that financial markets do go up and down... history tells us that markets recover – some faster than others, but they do recover.”
The ANZ leader said investors needed to remember that KiwiSaver was a long-term retirement investment. She also said the increase in calls was something positive.
“I think it’s a positive sign that so many customers are reaching out to us,” Mackenzie told RNZ. “We've had a lot of engagement with people over the past two-and-a-half years that switching during volatility is not a good thing, particularly for KiwiSaver, which is a long-term investment, so it's a sign that the engagement is working, and Kiwis are maturing as investors.”
Mackenzie urged investors to keep up contributions during the current volatility which would allow them to add to their investments at a lower cost.
Paul Huxford, ANZ chief investment officer, said the declines had to be put into perspective and the major US indices were still ahead compared to what they were before the pandemic broke out.
“People remember market sell-offs, but it's even more important to remember that each bear market has been followed by a recovery and new highs over the long-term,” Huxford told RNZ.
He said ANZ’s long-term investment approach remains unchanged.
“Our team typically focuses on what we believe are high-quality companies with robust balance sheets run by people with strong leadership qualities; companies which, over time, should become more valuable, and therefore help to grow the wealth of our members,” Huxford told RNZ.