The top Australian index funds can be classified as “bubbly”, “tense” or “fascinating”, according to the head who has helped them grow.
The top-rated Australian index was the New Zealand Funds (NZX), which had a return of 21 per cent over the past year.
However, the funds’ average growth rate of just 3.3 per cent since June 2017 was not enough to keep up with the country’s inflation rate.
New Zealand’s fund has seen the value of its holdings soar to $5.6 billion, according to data compiled by data analytics firm Coppersmith.
The average value of NZX’s investments is $5 billion, up from $4.3 billion at the end of June.
But what is the New York City Funds (NYM)?
The fund was ranked as the 10th-best-performing Australian fund by Copperscripts, which uses a range of metrics to rate investment returns.
It has a return on assets of 4.8 per cent and an average return of 4 per cent, while the average size of its portfolio is 6.3 times the size of NZ’s.
But the New Jersey-based fund is not a favourite of many investors because of its high volatility.
Coppersmith said it was “fairly rare” for a top Australian fund to outperform the S&P 500 index.
It said NZX was among the most volatile Australian index stocks, with an average volatility of 17 per cent.
However New York’s New Jersey Funds are not only a popular choice among investors, they also have been one of the best performing funds for a number of years.
The fund returned 4.2 per cent last year, up to a total of $569 million.
The NZX has seen its market value increase by more than 50 per cent in the past 12 months.
Its index value is $4 billion, and it has returned about $1.5 billion in the same period.
The New York Funds’ average portfolio size is 5.6 times the average value.
However Copperscience said NZM’s portfolio size was only 2.4 times the New Yorkers’ average, making it the worst performer of the top 10 Australian funds.
Coppercyscripts also compiled a ranking of Australian index investors by asset class.
While the New England Funds are the best-performing funds in the world, they have fallen out of the list due to the volatility in the index.
Its top 10 index fund is the American Funds (AXP), which has returned 6.4 per cent annually for the past two years.
However the fund is now ranked last, at number 20, down from the 20th spot in the last report in October 2016.
Its average portfolio is 4.3times the size.
Coppercyscript also said that New York and New Jersey funds had outperformed the S &M 500 index by an average of 18.5 per cent per annum.