InvestNow Flows Up In Volatile Year, KiwiSaver Scheme Doubles

Leading direct-to-consumer NZ diversified investment platform and KiwiSaver provider, InvestNow, has reported strong growth in 2022 despite a down year for most assets.

New clients poured a net $150 million into funds on InvestNow during the 12 months to the end of December while existing members continued to make regular contributions amid tough market conditions. The wide range of term deposits on the platform also proved popular in the rising interest rate environment of 2022 with inflow up over 100% year-on-year.

Over the same period, the InvestNow KiwiSaver scheme, which offers members a wide choice of external managers as well as an in-house range of diversified funds, more than doubled in size.

InvestNow founder, Anthony Edmonds, says the data shows investors on the platform remain focused on their long-term plans in 2022 regardless of the extreme volatile conditions.

“Our members have largely adopted diversified investment strategies in line with their personal goals and risk appetites – and they’re sticking with those plans,” Edmonds says. “This is a great sign that our investors are becoming increasingly sophisticated and can stay the course during bouts of volatility. We think our members have benefited from the experience of making real-life investment decisions at their own pace – learning through doing as well as through the education and information we provide on InvestNow.”

He says diversification paid off for investors last year as the ‘hot’ stocks melted down and portfolios concentrated on a handful of trendy companies or cryptocurrencies crumbled.

Typical balanced and growth diversified funds fell by about 12 per cent in 2022 as both equities and bonds suffered in an unusual double whammy. But many popular retail trader stocks such as Tesla and Meta along with speculative cryptocurrencies including bitcoin were gutted last year, dropping between 60 to 70 per cent.

“Of course, those beaten-down companies may recover some lost ground but investors who have put their entire portfolios in Tesla, for example, have a huge mountain to climb,” Edmonds says. “The Tesla share price will have to more than triple just to get back to its pre-crash peak.”

But InvestNow members have heard the risk management message, he says, with the group’s KiwiSaver scheme, in particular, seeing large flows into the in-house Foundation Series Balanced and Growth Funds.

The Foundation Series funds, which offers investors low-cost and tax-efficient exposure to global stock indices and fixed income assets, grew by 80 per cent over 2022 – and outperformed similar products offered by Simplicity by around 2 per cent.

Many InvestNow KiwiSaver members have supplemented their core holdings in the Foundation Series products with complementary funds offered by some of the other managers available via the scheme including Milford Asset Management, Pathfinder and Harbour Asset Management.

“Our InvestNow KiwiSaver clients love the fact that they can select funds from multiple good managers in a single scheme,” Edmonds says. “Our scheme overcomes the normal issue with KiwiSaver where your choice is usually limited to funds managed by the one provider.”

Established in 2017, InvestNow has since grown to $1.3 billion in funds invested across 26,000 members. In 2022, InvestNow was acquired by global financial services provider, Apex Group.

Note: Performance Comparison as at 31/12/2022 on before tax and after fees basis:

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