This fireside chat will be a wide-ranging discussion. Investment beliefs are a core part of an investor’s active strategy. Testing those beliefs by way of a reference portfolio is one approach to judge skill. Following the recent review of its reference portfolio, what has NZ Super learned?


Stephen Gilmore, Chief investment officer, NZ Super Fund

Moderator: Amanda White, Director of institutional content,

Key Takeaways

  • According to Stephen Gilmore, chief investment officer at the (NZD)$50 billion NZ Super Fund, getting the team together for its quinquennial reference portfolio review is a major event.
  • For Gilmore, the core benefit of reference portfolios is that they ground the fund’s investment governance and facilitate accountability of the investment committee. NZ Super’s reference portfolio is currently 75 per cent global equities, five per cent NZ equities and 20 per cent NZ bonds.
  • Gilmore explained the parameters NZ Super uses to create and review the portfolio as being relatively straightforward.
  • The reality, however, is often far from simple, especially when the reference portfolio is weighted against the uncertainty of 2020. NZ Super’s most recent five-year reference portfolio review was completed in June, and while the CIO said the reference portfolio looks relatively unchanged, he added there was “a lot of thinking and detailed discussion” behind its construction.
  • Gilmore said the biggest change in the assumptions used in the reference portfolio this year related to rates.
  • Like Australia, there has also historically been a benefit to carefully managed currency hedging, Gilmore explained. But assessing it in 2020 meant looking through a prism that included both increased uncertainty and unprecedented interest rate levels.

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