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Retail Net Funds Flow doubled in the year to March 2011

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Fuseworks Media
Fuseworks Media

In the March 2011 quarter net fund flows into retail managed funds were positive at $821 million compared to a positive $928 million inflow in the previous quarter.

Over the 12-month period to March 2011, net funds flow totalled a positive $2,504 million, a 96% increase over the corresponding period to March 2010.

KiwiSaver regained the top spot over Unit Trusts to post the largest net inflows of $570 million, a 16.9% rise compared to the December 2010 quarter.

A large increase in the industry's net fund flow for the March quarter was predominantly attributable to KiwiSaver contributions and Cash Pie funds in the Unit Trust sector; in contrast, Group Investment Funds (GIFs), Superannuation Funds, Insurance Bonds and Australian Unit Trusts continued to experience a decline in funds flow for the twelfth consecutive quarter since June 2008.

The retail managed funds sector recorded a 6.7% rise (or $1.6 billion) in total funds under management to stand at $25.0 billion for the year ending March 2011. There has been a mixed result in terms of growth in funds under management, where KiwiSaver and Unit Trusts have increased by 60% and 34% respectively since March 2010 while GIFs, Superannuation Funds and Insurance Bonds took a plunge across the board. Regional Equity and Global Equity, despite experiencing negative funds flow in the March quarter, recorded an increase in funds under management aided by the strong performance of international equity markets. These sectors' returns averaged 2.8% and 4.8% respectively over three months to March 2011. There was also a slight change in fund managers' ranking in terms of net funds under management in this quarter, with Kiwibank and AMP exchanging their places as the former moved up one spot to fifth place and the latter to sixth place. FundSource's quarterly report captures trend information for the last 20 years for New Zealand's retail managed funds industry across unit trusts, superannuation funds, group investment funds, insurance bonds, Australian unit trusts and now KiwiSaver.

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