It was much weaker than expected and offered further evidence that we have faced a very challenging period.<\/p>\n
The economy has contracted (on a per capita basis) for nine of the past 12 quarters, making for a deep and lengthy recession.<\/p>\n
This has inevitably weighed on the performance of local investments, and contributed to some of the pessimism.<\/p>\n
Other countries have had a much better time of it, and there have been some excellent opportunities for strong investment returns of late.<\/p>\n
They just haven\u2019t been here in Aotearoa.<\/p>\n
This really highlights the need to ensure your investments are globally diversified.<\/p>\n
If you haven\u2019t done that, and have instead hunkered down in New Zealand assets, you\u2019ve left a huge amount on the table.<\/p>\n
The NZX 50 sharemarket index is up a marginal 0.2% in 2025, only barely in positive territory.<\/p>\n
National house prices are down 0.9% this year, having declined for seven of the past nine months. Photo \/ 123rf<\/p>\n
The housing market has been even weaker.<\/p>\n
National prices are down 0.9% this year, having declined for seven of the past nine months.<\/p>\n
Domestic fixed income has performed better, with the NZX Corporate Bond Index up about 5% this year.<\/p>\n
One segment of the local investment landscape that\u2019s had a great run in 2025 is listed property.<\/p>\n
The NZX index that represents our largest listed commercial landlords is up more than 15% this year.<\/p>\n
That\u2019s a welcome recovery, with the sector flatlining in the previous five years.<\/p>\n
Let\u2019s hope that\u2019s an early sign that confidence is returning to the broader commercial property sector, and that 2026 will be a brighter year than the past few have been.<\/p>\n
Most of those returns are mediocre, to be honest, especially when we compare them to international assets.<\/p>\n
World shares are up 17.8% so far this year, with the dominant US market having returned 14.4%.<\/p>\n
Emerging market equities (for which China is the biggest constituent) have rallied an impressive 23.9%, the UK is up 16.2% and Europe is 12.7% higher.<\/p>\n
Japanese shares are up 13.6%, while the Australian market has gained 11.0%.<\/p>\n
Currency moves push some of those numbers around, and the pecking order changes quite a bit.<\/p>\n
The NZ dollar is up almost 5% against a softer greenback, reducing the return from US shares to just below 10% and emerging market shares (which are benchmarked in US dollars) to 18.2%.<\/p>\n
However, our currency has fallen almost 8% against the euro and 3% against the British pound.<\/p>\n
That boosts the return from those two regions to 22.4 and 19.6%.<\/p>\n
All these numbers include dividends so they\u2019re consistent with how our NZX 50 index is calculated.<\/p>\n
Whether it\u2019s houses or shares that spin your wheels, the lesson has been the same so far.<\/p>\n
If you had too much (or worse still, all) of your investable capital in local assets, you did yourself a disservice.<\/p>\n
Even if you correctly picked that New Zealand assets would languish and chose to keep your powder dry in cash or bank deposits, you still missed out.<\/p>\n
New Zealand won\u2019t always be a laggard, even though we\u2019ve had a few lean years.<\/p>\n
In the decade leading up to the pandemic local shares outperformed international markets on seven out of 10 occasions.<\/p>\n
However, we\u2019ve really fallen behind since then.<\/p>\n
As workers, homeowners and small business owners, there\u2019s not much we can do but stick it out and hope for things to improve.<\/p>\n
Investors don\u2019t face those same constraints, and it\u2019s never been cheaper or easier to spread your wealth across greener pastures.<\/p>\n
There are many funds and ETFs that can help achieve this for even the smallest investors, in a very cost-effective way.<\/p>\n
We live in a great country and we all hope there\u2019s a more prosperous period ahead, but there\u2019s no need to be \u201call in\u201d.<\/p>\n
The mobility of your capital means the world is your oyster and investors should take advantage of that.<\/p>\n