Overview
Member’s Whai Rawa funds are able to be invested in the Mercer Investment Trusts New Zealand’s Socially Responsible Conservative, Balanced and Growth Portfolios.
Each portfolio has a different level of risk and accordingly different return expectations.
Current Whai Rawa Investment
Three funds were introduced to ensure that all our whānau have options as to which Whai Rawa investment fund their money is invested in. Looking at the options available ensures that at any age or life stage you can choose a Fund that better reflects the personal needs and risk appetite of your whānau.
The Whai Rawa Unit Trust (the Scheme) is invested in Mercer Investment Trusts New Zealand’s Socially Responsible Conservative, Balanced and Growth Portfolio’s. Each portfolio has a different level of risk and accordingly different return expectations.
NOTE: The returns you receive are dependent on the investment decisions of WRFL, the fund management decisions of the Fund Manager and the performance of the investments. The value of those investments may go up or down. Note that even the lowest category does not mean a risk-free investment.
Your member account
When your contributions are made, they join a pool of assets from other members invested in that same portfolio. To keep track of the value of each person’s share of the pool, the total value of the assets in the pool is divided into units of equal value. Units are then allocated to your account. The value of your savings rises or falls depending on changes in the price of the investment assets owned. Unit prices are used to help track changes in the value of your Whai Rawa account.
For more information on the investments of Whai Rawa see the Other Material Information document or view the Whai Rawa Statement of Investment Policy and Objectives document.
Returns paid to members
On a daily basis, the value of your investment will rise or fall based on the unit price. In our new member account platform, you’ll notice that the value of your Whai Rawa savings is being calculated and available daily. The number of units you own and their value will appear alongside your account balance when you check your account.
Market Volatility – April 2025
What has happened?
Global sharemarkets, including New Zealand’s, have faced significant turmoil recently following U.S. President Trump’s global tariffs on imports. The tariffs, ranging from 10% to over 50%, have sparked fears of a global trade war and economic recession, leading to sharp selloffs across major indices. Over the course of a single day in the U.S., the Dow Jones and Nasdaq fell by over 5%, while New Zealand’s NZX50 dropped more than 3%, its worst session since the pandemic, wiping out $2 billion in market value. Export-driven sectors have been hit hardest, and the New Zealand dollar has weakened against the U.S. dollar. Economists warn these tariffs could slow global growth, disrupt trade, and increase volatility in markets worldwide.
What does this mean for me and my investments?
The market reaction has been negative across the board. Many investments such as your KiwiSaver account and your Whai Rawa account may have dropped in value over the past couple of weeks. But remember that market corrections are normal and over the longer-term, markets tend to recover.
The Financial Markets Authority (FMA) comment that investments work in timeframes of decades, up to 40 or 50 years. For these long-term periods, a fund with a higher allocation to growth assets is usually the best option. These funds have more volatile assets in them, such as shares and property. So, when world markets are unpredictable, they will be the ones that move around more. The upside is, over the longer-term these funds are expected to provide higher returns, growing your money more.
What does Mercer NZ our Investment Manager say?
While our expectations ahead of these announcements was for substantial tariffs to be introduced, these country-by-country tariffs are larger than many—including ourselves—expected.
The tariffs act as a big fiscal tightening with the collected revenues leading to an improvement in the US fiscal deficit. There is considerable uncertainty as to how long these tariffs will last, how much of them will be negotiated and substantially lowered/eliminated. Our initial assessment is that should these tariffs get implemented as planned and absent a notable fiscal stimulus—which seems unlikely in the near term—we are of the view that they will cause a US recession in the near term.
However, it is worth noting that given these tariffs were higher than most people expected, there is room for positive surprises if they are negotiated away. Notwithstanding, the complex interplay of second order effects from these policies.
In summary, at the time of writing, latest developments have skewed global growth risks to the downside and inflation risks to the upside. Against such a backdrop we believe there is likely to be further volatility ahead.
You can find more information on market volatility here.
