Simplicity’s Growth Fund overtook Milford’s active growth fund as the top performer over 10 years, according to new Morningstar data. The latest quarterly update shows Simplicity’s fund returned 9.9% annually, while Milford’s fell to 9.6%, placing it third behind Quay Street’s 9.7%.
Milford’s decline followed a shift in its approach to the tech boom, with its three-month returns lagging behind Simplicity and Quay Street. Milford recorded 0.9% growth over three months, compared to 1.7% for Simplicity and 2.7% for Quay Street. AMP’s fund recorded 13.6% annual growth, compared to Simplicity’s 11.7% and Milford’s 3.4%. Milford’s chief investment officer, Wayne Gentle, attributed market performance to a narrow set of US tech companies driving returns, noting “a disproportionate amount of that return” came from a small group of firms.
Milford Manages Risk with Diversified Technology Exposure
Gentle highlighted that Milford’s active growth fund captured 91% of market gains over 10 years but only 77% of declines, emphasizing its risk management approach. Despite heavy technology stock exposure, including AI themes, Milford maintained a more diversified portfolio than passive funds, which have larger tech allocations. “We’re not going to hold [Nvidia] at an index weight,” said KiwiSaver’s Murray Harris, referencing the fund’s 3.5% exposure to the stock. Harris noted that Nvidia constitutes approximately 9% of the index, but Milford’s exposure is 3.5%.
Market Volatility Pressures Traditional Diversifiers and Shifts Rankings
Gentle acknowledged caution in recent months, which he said “has not been rewarded in equity markets to this point.” He noted that traditional diversifiers like bonds and defensive equities underperformed, with bonds pressured by oil price spikes and safer stocks struggling. Harris predicted increased movement among top performers as market dynamics evolve, citing recent volatility from tech sector announcements. “There’s been a bit more convergence now across the top four or five providers,” Harris said, signaling potential shifts in future rankings.
“There’s been a bit more convergence now across the top four or five providers,” Harris said, signaling potential shifts in future rankings.
