Returns vs Reference Portfolio

The Reference Portfolio is our passive benchmark and a very clear way for the Guardians to benchmark active (value-add) investment returns net of all costs.

Our aim, as an active investor, is for our Actual Portfolio to add more value to the Fund than the Reference Portfolio would do, using strategies based on the Fund’s endowments as a long-term, sovereign investor with low liquidity requirements.

Over the last decade the Fund exceeded the Reference Portfolio return by 1.69% p.a. or NZ$5.5 billion (after costs, before tax).

In recent years the composition of the Fund has become increasingly different to the Reference Portfolio and the Fund has moved visibly ahead of the Reference Portfolio's returns.

Monthly Updates

While monthly updates on the Fund's performance against the Reference Portfolio benchmark are provided, it is important to remember that the Fund's active investment strategies are long-term ones that are designed to play out over many years. Performance over short and medium-term periods needs to be seen in this context. Refer to our Annual Reports for audited figures.

Fund Performance (after costs, before tax) as at 30 June 2017One YearThree YearsFive Years Ten YearsSince Inception (Sept 2003)
Actual Fund Returns20.71%12.12% p.a.16.18% p.a.8.63% p.a.10.22% p.a.
Reference Portfolio Return16.34%9.11% p.a.12.95% p.a.6.94% p.a.8.77% p.a.
Value-Added (Actual Return - Reference Portfolio Return)4.37%3.01% p.a.3.23% p.a.1.69% p.a.1.45% p.a.
Estimated $ earned relative to Reference Portfolio$1,285 million$2,809 million$4,802 million$5,559 million$6,247 million

Note: the Reference Portfolio has been one of our performance benchmarks since July 2010. Prior to then the Guardians' used a Strategic Asset Allocation model to measure the value the Guardians were adding through active investment. Comparisons prior to July 2010 are based on the Strategic Asset Allocation model.

To find out more:

Read more about the composition of our Reference Portfolio here.