Market volatility

Are you prepared for it?

Financial markets tend to move in cycles and, every now and again, you should expect them to go through periods of volatility. However, investment market volatility is part of investing and does not have to be a cause for concern. Chances are you’re saving for a long-term goal, such as retirement. So, depending on your personal circumstances, it may be better to focus on long-term trends rather than short-term changes in the market.

When it comes to investing, there’s a trade-off between risk and return. Higher-risk assets such as shares fluctuate more, but have the potential for higher returns over the long term. Lower-risk assets such as term deposits fluctuate less, but have lower expected returns over the long term.

Typically, when some investments may be falling in value, there are others that are doing better – and it’s this combination of assets that can offer your investment some protection during times of market volatility. The KiwiSaver schemes and investment funds managed by ANZ Investments generally invest in a diverse mix of quality assets. These include international and local equities (shares), listed property, fixed interest (bonds), and cash and cash equivalents.

It’s important you take the time to consider your fund options and invest in a fund that suits your investment objectives, timeframe and risk/return profile. You should review your fund choice whenever your personal circumstances or investment objectives change, to ensure you remain invested in the right fund.

If you need help deciding which fund is right for you, or want more information, you can:

  • get more details about our funds here
  • complete the ‘Risk Profile Tool’ to identify your risk/return profile and which fund might be right for you
  • seek personalised financial advice from a financial adviser.