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Economic Commentary March Quarter 2024

Large cap global equities performed very strongly again over the quarter despite the soft global economic environment. Gains were strongest in US equities over the past year, in part reflecting the relative strength of the US economy and the AI boom underway.More interest rate sensitive parts of the market, including listed property, infrastructure, NZ equities and standard duration bonds took a breather this quarter.Benchmarking PerformancesBenchmarks are tools used to assess the performance of...

Economic Commentary December Quarter 2023

Most asset classes performed well over the December quarter……as markets became more convinced that a global soft -landing scenario is the most likely outcome for the years ahead.Gains were strongest in US equities over the past year, in part reflecting the relative strength of the US economy.Interest rates were slashed to historic lows in 2008/9 and remained at exceptionally low levels until late 2021.Central banks believed until recently that the balance of inflation vs. deflationary risks ...

Morningstar NZ Economic Commentary January 2024

• Markets continue to embrace moderating inflation trends, allowing scope for central banks to lower interest rates modestly while delivering a soft landing for the global economy. That sentiment is vulnerable to challenge.• The onus will be on inflation outcomes to validate market expectations, with core inflation measures globally still elevated and slow to return to target.• Growth in New Zealand is weak, and inflation pressures are receding, allowing scope of an eventual loosening of m...

Morningstar Economic Commentary NZ October 2023

SummaryHigher-for-longer interest-rate policy settings from central banks have been accentuated by widening term premiums lifting longer-term interest rates.Interest rates are not high relative to their longer-term history, but the recent rise is the most significant increase over a three-year period since 1980.Growth and labor market conditions continue to support a soft landing.Given the material lift in interest rates of late, and lags between monetary policy and the real economy, late-cycle ...

How parents can teach scarcity to improve...

David Boyle - Mint Asset ManagementIn 1978 my mum bought me a Sanyo 2-in-1 cassette radio player. It was a game changer for me. That’s because, before getting the player, my only access to music was listening to 3ZB, watching my fav bands on RTR and Radio with Pictures or buying a 45 when I could afford it.  Now, with this new player and the advent of cassette tapes, I was able to go to the next level and not only listen to my favourite songs but play them again and again where and when I...

World Investor Week

The first week of October was World Investor Week and the New Zealand theme for World Investor Week 2023 is ethical investing which aims to empower investors to make decisions aligned with their values. “A goal without a plan is just a wish” Having a well-thought-out plan is an important first step in your investing journey.It means choosing to invest in companies or funds that have a positive impact on society and the environment, and avoiding those that cause harm or have negative effects....

Economic Commentary September Quarter 2023

Most asset classes suffered negative returns in the September quarter.The short end of the yield curve is offering compelling opportunities for bonds.Global equities have the strongest returns YTD; elsewhere performance is modest.Short duration and alternatives have been key contributors to portfolio returns.Asset class diversification reduces portfolio risk for a given return.Diversification occurs because markets have different drivers of return, they are not perfectly correlated.The best sour...

CC2023: Don't just hope, leave a legacy

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Morningstar Economic Update NZ June 2023

• Core inflation and headline inflation pressures are easing, but the former is glacial in pace and central banks are becoming more concerned that elevated inflation could be embedded in pricing behaviour.• Fixed-income markets are gravitating towards central banks keeping interest rates higher for longer, though they still expect some modest relief in 2024.• Equities have performed well, in part buoyed by economic resilience, artificial intelligence prospects, receding headline inflation,...

Economic Commentary June Quarter 2023

Global equity markets bounced higher again in the June quarter. This was in part due to continued evidence of CPI inflation moderating, but mainly because larger cap tech stocks rallied on the prospect that they will see another surge in profitability as machine learning and related ‘Artificial Intelligence (AI)’ algorithms are integrated into their core products and services.Global equities had the strongest returns, elsewhere performances were subdued.Global equities are now back around th...

GC2023

SUPPORTING INFORMATION22nd May 2023Thanks for attending our session in Tauranga, it was great to be able to share with you.We referred to the following links during the session:NZ Super payment rateshttps://www.workandincome.govt.nz/eligibility/seniors/superannuation/payment-rates.htmlRetirement Expenditure Guidelineshttps://www.massey.ac.nz/documents/476/nz_retirement_expenditure_gudelines.pdfMorningstar KiwiSaver Survey Research Reporthttps://www.morningstar.com.au/insights/funds/234920/kiwisa...

Magellan Infrastructure Presentation

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Should the recent US bank failures be of concern for my investment portfolio?

The short answer is no.You need not to be concerned about single company failures.  In a well-diversified investment portfolio that is actively managed the recent bank failures will have little or no impact.What happened?Silicon Valley Bank (SVB) was a large, and very unusual bank dealing almost exclusively with tech startups. SVB share price showed an incredible rise during 2020 and 2021. The stock returned investors around 180% in that two year period. During 2022 the market changed rapid...

Why confidence is affecting women’s retirement outcomes

David Boyle of Mint Asset ManagementConfidence is a funny thing. When I was younger, I got a Dragster (bike) for Christmas. I thought it was the coolest thing ever and it provided me with an air of invincibility. So much so that when I was at Cubs, I told my mates I could ride down the hill to the Den (a meeting house for Cubs) faster than anyone else.  Now, this was a steep hill and, to cut a long story short, I did indeed beat everyone down to the bottom. That said, it became apparent ver...

Morningstar NZ Economic Update March 2023

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Economic Commentary March Quarter 2023

OverviewBoth equity and bond markets bounced higher in the March quarter, following increasing signs that central banks are getting on top of inflationary pressures.  However, the pattern of returns was quite volatile.  Equity markets surged in January on the back of reducing interest rate expectations, only to sell-off most of this gain in February and into early March as the banking sector particularly, came under pressure with the failure of Silicon Valley Bank.  Later in March...

The Value of Financial Advice

The value of financial advice for your future retirement destinationThe new licensing of financial advice takes effect on March 15, here’s why it’s good news for consumersDavid Boyle :  Mint Asset ManagementAdvice can come in many forms, whether it’s from your parents, your doctor, or even your cab driver. However, the quality of advice, depending on the source, may not always be in your best interests.When I was growing up, I would seek financial advice from my mum and dad on most th...

Quarterly Economic Commentary Dec 2022

So long and good riddance to 2022.  War, inflation, rising interest rates, and economic bottlenecks led to poor returns in most asset classes. In fact, 2022 was unusual in the sense that equities and bonds both fell simultaneously by large amounts. Usually, bonds act as a safe haven when equity markets fall.  As a result, a balanced 50/50 portfolio of global stocks and bonds had its worst year for nearly a century (Figure 1).In contrast, asset classes that offer inflation resilience su...

Retirement: How much is enough? And are you on track?

Are you on track for the retirement lifestyle you’re envisioning? How much would you need to put aside to get there? When it comes to saving for retirement, one size doesn’t fit all. How much you’ll need depends on the lifestyle you’re aiming for, where you’ll live, your expenditure levels, the age you plan to retire, and a lot more. With so many factors to consider, identifying your ‘sweet spot’ is no easy task. But if your ‘golden years’ are just around the corner, now is a g...

Economic and Market Commentary Sept 2022

To read the full document please click the link below. Main points: Equity markets were mixed but bonds fell heavily.Currency markets had significant moves. Timing markets is difficult, but cash yields are becoming meaningful again.  Unhedged exposures performed relatively well. NZ and Australian equity markets were resilient. Fixed income returns were poor again.Alternative asset classes have added substantial value to portfolio returns....

A long-term solution for a short-term emergency

David Boyle Mint Asset Management In 1986 I bought a Fiat 124 Sport 1800 coupe. As I signed the ownership papers, my dad’s words were ringing in my ears about how unreliable they were and how costly they were to run. But I knew better and my mind was made up. It was the coolest car I had ever had. Not that I had much of a benchmark to go by. My first car was a Morris Minor 850cc (well actually it was Dad’s) split windscreen 55 and then, to keep up with my mates, I bought a 1979 SR Toyota Co...

NZ Retirement Expenditure Guidelines - Massey University

New Zealanders have a new factor to consider in their retirement planning: inflation. With inflation rising to 7.3% for the twelve months ended 30th June 2022, it is markedly higher than our recent experience. Although we have experienced higher rates in the past, that was more than 30 years ago, and is therefore a distant memory for most.Retirement is often included in lists of the most stressful life events which makes it important to prepare and plan for retirement. Without good preparation a...

Navigating the Inevitable

By David Boyle - Mint Asset Management Benjamin Franklin once said "By failing to prepare, you are preparing to fail." And it was a quote that came to mind when I started writing this article. Losing a parent is one of the most difficult things to deal with, especially if they were the last parent and meant the world to you. I can talk about this experience first-hand, after losing my mum at 95 just recently. While dealing with all the emotional issues around losing a parent, there are so many o...

Stuff your Dad would say...

David Boyle - Mint Asset Management I’m not sure if you have ever seen the George Clooney movie “The Perfect Storm” but it was the best analogy that I could think of, given how investment markets have been behaving since the beginning of 2022. Everything that could have contributed to a negative return for investors has come together and created a market where there have been few safe harbours to shelter in. The good news is, with a little bit of courage, maintaining a strong constitution,...

History May Not Repeat But it Can Rhyme

At the start of this year, we asked the question “Is the inflation genie out of the bottle”? Looking back over the last six months, the short answer is Yes – or at least central bankers seem to think so. The longer-than-short answer is not for long. In our view, either inflation will dissipate of its own accord (the global economy adjusting to equilibrium), or the world’s central bankers will raise interest rates until inflation falls. We prefer the former scenario because the latter li...