Whai Rawa Investment

Returns History

Whai Rawa's investment (Cash from inception until October 2010) has performed well for Whai Rawa meeting the original key objective of ensuring members suffered no losses, and generating average returns before tax of 5.99% p.a. over the 3 years to 30 June 2010.

Since inception the Trust has produced the following performance results:

Annualised Investment Return for the twelve months ended 31 March 2010	Annualised Investment Return for the twelve months ended 31 March 2009	Annualised Investment Return for the nine months ended 31 March 2008	Annualised Investment Return for the nine months ended 30 June 2007
3.89% p.a.	7.44% p.a.	7.77% p.a.	5.22% p.a.

Change of Investment

From early October 2010 Whai Rawa funds moved from the ING wholesale cash fund to Mercer Investment Trust New Zealand’s (‘Mercer’) new Defensive Fund. Mercer has also taken over as investment manager. As investment manager Mercer will:

report on the performance of Whai Rawa's investment and investment returns;
provide market commentary and outlook; and
provide asset allocation monitoring and will monitor compliance with benchmark asset allocation.

While the Mercer Defensive Fund is still a conservative fund it does contain some growth assets and the changeover is intended to generate a better returns over time for members, while still remaining a low risk profile.

Investment Objectives and Strategy

Whai Rawa's sole Portfolio will be invested in a conservative mix of defensive and growth assets with a benchmark split of 80% defensive assets and 20% growth assets. The longer term performance and risk objectives of the conservative investment portfolio are:

Maintain the risk of negative returns in any 12 month period at less than 4% (i.e. less than 1 year in 25 on average).
Achieve a real return before tax and investment management fees of at least 4.5% per annum over any rolling 10 year period.

There is no guarantee that Whai Rawa can achieve its investment objectives.

Makeup of investment

Defensive assets will, in the main, consist of interest earning investments and could include fixed interest investments (both sovereign and credit) and cash type assets.

Growth assets will, in the main, consist of growth orientated investments and could include shares and "real" assets (such as property, infrastructure and natural resources).

The benchmark breakdown between main asset types:

Defensive assets:
- Bonds 50%
- Cash 30%
Growth assets:
- Shares 15%
- Real assets 5%

Projections and Future Returns

The current Whai Rawa prospectus (September 2010) provides a projection based on an assumed return of 5.45% after tax (for a member on the top prescribed investor rate of 28%), reflecting the Manager’s reasonable expectation of a possible rate of return that might realistically be expected to be achieved over the life of the investment. In 2011 we will be providing a tool to enable members to run projections for themselves.