Periods of heightened global tension can create short-term volatility in financial markets. When uncertainty increases, investors often see movement in:
Because KiwiSaver funds invest both in New Zealand and internationally, short-term market fluctuations can occur during these periods.
Global markets have historically experienced volatility during:
"While headlines can create uncertainty, markets have historically recovered over the long term as economies adapt and stabilise. It can be difficult to see your balance lower at times like this, but making rushed decisions in response to the headlines can sometimes lock in losses."
- Simon O'Grady, Booster Chief Investment Officer
If you have a long time to go before you need to access your KiwiSaver savings, you have time on your side. The current ups and downs shouldn’t be of concern.
If you are planning on accessing your KiwiSaver savings in the next couple of years, say for a first home or when you retire, you are likely to already be in a more conservative fund which tends not to be as heavily impacted.
As uncomfortable as it might be watching the markets go down, the best thing you can do is hang tight and wait for the upside.
Our investment team continually assesses global and local developments and manages our funds with the aim of building strong results in the longer term.
Global events can cause short-term market volatility. Because KiwiSaver funds invest in international markets, global developments may temporarily affect returns. However, KiwiSaver is designed as a long-term investment.
Changing funds during periods of volatility may lock in losses. It’s important to choose a fund based on your long-term goals, timeframe and comfort with risk — not short-term market movements.
If you're wondering whether now is the right time to make a change, read our guide on when to review or change your KiwiSaver fund.
We recommend you get professional advice. If you don’t have a financial adviser, we can help - we have a team of in-house KiwiSaver experts who can help you at no extra cost. Call us on 0800 336 338 or send a message.
If you would prefer independent advice, we have a network of over 400 advisers across New Zealand, so can connect you with an adviser that’s right for you.
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Booster Investment Management Limited is the issuer of the Booster KiwiSaver Scheme (Scheme). The Scheme’s Product Disclosure Statements are available at www.booster.co.nz or by contacting your financial adviser.