The value of the NZ Super Fund has reached a record high of $76.6 billion at the end the 2024 financial year, up from $65.4 billion a year earlier. 

For the year to 30 June, the NZ Super Fund posted a return of 14.94% after costs and before NZ tax. 

The strong investment returns meant the Fund paid $1.5 billion in New Zealand tax on 29 July 2024, in relation to the 23/24 financial year. Government contributions to the Fund during the year were $1.6 billion. 

Jo Townsend, chief executive of fund manager the Guardians of New Zealand Superannuation, said the NZ Super Fund had benefited from strong global share markets over the past 12 months. 

“Declining inflation, positive macroeconomic data and optimism that generative AI technology will boost corporate profitability saw global markets perform exceptionally well,” Ms Townsend said. 

As a result, the Fund, of which about half is invested passively, beat its Treasury Bills benchmark by 9.33%. Since its first investment in 2003, the Fund has outperformed this benchmark, which represents the cost to the Government of contributing to the Fund, by 6.50% p.a. or $50.1 billion. 

The strong performance by equity markets meant the Fund finished the year very slightly below its passive Reference Portfolio benchmark, which returned 15.13%.  

Ms Townsend said the Fund’s active investment strategies, which include commitments to real estate, infrastructure and timber, had added significant value over the lifetime of the Fund to date and suited the Fund’s mandate and its long-term investment horizon. 

“Since the Fund began in 2003, returns have outperformed the Reference Portfolio benchmark by 1.46% p.a.,” Ms Townsend said. 

“To put it another way, the Fund is more than $17 billion better off than if we had implemented a strictly passive, index-linked approach.”  

Ms Townsend said much of the growth in global equities had been generated by a small subset of technology stocks, dubbed the Magnificent Seven in the US. As at 30 June 2024, market capitalisation of the Magnificent Seven was nine percent larger than the entire European equity market.   

“Having global market indices so heavily dominated by such a small number of stocks, all of which are concentrated in one sector, is a very unusual situation,” said Ms Townsend. 

“We manage the portfolio in order to achieve the best long-term results for New Zealanders, in line with our intergenerational mandate. Our equity exposure is highly diversified across sectors and geographies, and our active investment strategies are designed to take advantage of market ups and downs as they occur.”  

RESULTS FOR 2023-2024 FINANCIAL YEAR 

All figures are provisional and unaudited. The Guardians of New Zealand Superannuation Annual Report and audited financial statements will be released in late October.

*Figures are cumulative; not per annum 
#This relates to tax payments made during the financial year and represents the residual tax liability of the NZ Super Fund and its subsidiaries for FY2022/23