Welcome to your April update
Dear investor, welcome to the SBS Wealth Investment Funds Investor Update for April 2025. Below you will find the latest performance data and market commentary from your SBS Wealth Investment Management Team.
Performance data
Performance as at 31 March 2025.
| Strategy | 1M | 3M | 6M |
| High Growth Strategy | -4.08% | -4.36% | 14.46% |
| Growth Strategy | -3.87% | -3.32% | 7.26% |
| Balanced Strategy | -2.94% | -2.29% | 0.47% |
| Conservative Strategy | -1.55% | 0.76% | 1.18% |
| Portfolio | 1M | 1Y | 5Y pa |
| World Equity Portfolio | -5.28% | 7.69% | 14.46% |
| Australasian Equity Portfolio | -3.35% | 0.44% | 7.26% |
| World Bond Portfolio | -0.30% | 3.66% | 0.47% |
| New Zealand Bond Portfolio* | 0.07% | 6.46% | 1.18% |
* Previously Corporate Bond Portfolio
Performance is shown after fees and before tax. For more information about how performance is calculated and more performance periods, click here.
Market update
Financial markets spent most of March focused on and reacting to short-term events in Washington. US President Donald Trump’s further announcements of sweeping tariffs added to market volatility in March as a universal 10% tariff on all imports and higher rates on specific countries was digested. Retaliation added to the turbulence as the likes of Ontario Premier Doug Ford added a 25% export tariff to electricity exported to the US before prompt removal following Trump’s threat of raising the current 25% steel and aluminium tariff to 50% for Canada.
Elon Musk’s Department of Government Efficiency (DOGE) continued with increasing public sector layoffs and culling of government spending throughout the month which also weighed on recession concerns.
The Federal Reserve met again for its regular meeting, where no change was made to the benchmark Federal Funds Rate, citing higher levels of economic uncertainty. Outside the US, we saw 0.25% interest rate cuts from the European Central Bank and Bank of Canada. Elsewhere, the Bank of Japan and Bank of England also conducted their regular meetings but did not make any adjustments to their respective interest rates.
Trump’s new trade policy measures led to the S&P500 slipping further into negative territory during March (-5.6%), unfortunately taking the quarterly result into the red as well. Despite the ongoing rotation away from technology stocks toward other sectors like healthcare, consumer staples and financials in previous months, the key index experienced broad declines across all sectors, except for Energy (+2.7% for the month). Consumer Discretionary slid the most (-9.8%) followed by Information Technology (-9.8%) for the month.
The World Equity Fund fell 5.28% during March, on the back of the Tariff War, with many of the Technology, Communication Services and Consumer Discretionary darling stocks of 2024 down over 10% for the month (Apple, Nvidia, Xero, Amazon, Disney, Alphabet, Meta, Tesla, Eli Lilly, Novo Nordisk). Many of our defensive positions did their job though and helped the Fund from falling further. For example, United Health Group was up +9.6%, Kernel Global Infrastructure +3.0%, iShares Global Clean Energy +1.7%, Roche +1.2%, Sony +0.6%, and Schroders Emerging Markets +0.1%. Longer-term the three-year return is over 9%pa and the five-year return over 14%pa.
Domestically, the NZ sharemarket was down for the month, NZX50 -2.6%. Performance was again impacted by wider market tariff turbulence and continued slow economic performance at home. Increased trade tensions, including the establishment of a 10% US tariff on NZ exports and increased US tariffs on China (our key trading partner) also weighed on performance. Across the ditch, the ASX200 index finished the month down –3.4% on a total return basis, led by Information Technology (-9.7%). Commercial and Industrial property, and Healthcare also retreated, among most other sectors, returning –4.9% and 4.6% respectively. Fears over reduced export demand from Australia (a largely export dependent nation) and weak performance in the resource sector impacted by declining iron ore prices also affected performance.
On the back of this, the Australasian Equity Fund fell 3.35% during March. Worst hit was Macquarie Group, Mainfreight, Xero, and Goodman Group. Many of our defensive positions did their job though and helped the Fund from falling further. For example, QBE Insurance was up +3.9%, and Telstar, Auckland Airport and Transurban all up +1.0%. Longer-term the five-year return is over 7%pa.
The World Bond Fund fell 0.30% during March, with shorter duration positions protecting investors somewhat. The domestic bond market performed slightly better than its global counterpart, with the New Zealand Bond Fund returning a positive +0.07%.
The investment strategies were all negative for March, with the severity of the equity markets adversely affecting them all for the month and the quarter.
