Investor update

SBS Wealth Investment Funds - September 2026

Welcome to your September update

Strong earnings help markets move higher

August was a positive month for global share markets, with strong company earnings and continued investment in AI helping support investor confidence.

While markets experienced periods of volatility as investors reassessed the outlook for interest rates, share markets generally moved higher over the month. Across our Investment Funds, stronger equity returns helped offset a more challenging environment for bond investments, highlighting the benefits of diversification.

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Patience and skin in the game were rewarded in August

Equity markets rebounded in August following continued strong corporate earnings out of US companies, driven in large part by Tech companies. Bond markets were volatile, but our diversification saw the fixed interest funds return flat results overall.

Following the dip in July, KiwiSaver members were once again taught the value of patience and remaining invested.

Performance data

Performance as at 31 August 2026.

Fund Option	1M	1Y	5y pa	10Y pa
High Growth Strategy	1.71%	14.58%
Growth Strategy	1.37%	11.76%
Balanced Strategy	1.03%	8.96%
Conservative Strategy	0.52%	4.76%
World Equity Portfolio	1.83%	18.01%	10.49%	11.87%
Australasian Equity Portfolio	1.36%	4.63%	2.05%	5.84%
World Bond Portfolio	-0.02%	-0.10%	-0.22%	0.83%
New Zealand Bond Portfolio	0.07%	2.45%	2.16%	2.07%

For more information about how performance is calculated and for more performance periods, click here.  

What happened in the markets?

Investors remained focused on the outlook for interest rates, inflation and economic growth, while also assessing the sustainability of strong corporate earnings that have been delivered by many large technology and AI-related companies. Geopolitical developments, particularly in the Middle East, continued to contribute to periods of market volatility.

Global equity markets generally moved higher during the month, supported by the resilient corporate earnings and ongoing investment in AI infrastructure. Technology stocks were once again among the strongest contributors to returns, although markets became more cautious towards month-end as investors reassessed the possibility that interest rates could remain elevated for longer.

US share markets in particular recorded solid gains, driven by stronger than expected earnings results, and continued optimism around AI-related spending. Investor sentiment was supported by evidence of ongoing economic resilience, although comments from central bank officials later in the month led markets to further set back any expectations of near-term interest rate cuts.

European markets also delivered positive returns, benefiting from improved economic sentiment and broad-based sector strength. Energy companies were supported by firmer commodity prices, while Financials benefited from the prospect of interest rates remaining higher than previously expected.

Fixed interest markets faced headwinds as government bond yields rose. Investors increasingly questioned central bank monetary policy and the path of bond yields, particularly in the longer duration. This ultimately led to some weakness in bond prices and performance for many bond sectors. Higher yields are largely reflective of ongoing inflation concerns and uncertainty around the future path of interest rates.

What happened in our funds?

World Equity Portfolio

The World Equity Portfolio returned a positive result of +1.83% for the month of August, following July’s dip.

Global equities were buoyed after strong corporate earnings were released by key Tech companies, particularly those involved in the AI infrastructure buildout. After July’s pullback in this market segment, August offered a good setup and managed to follow through.

The top performers were Micron Technology (+15.7%) and Palo Alto (+14.4), followed by Nvidia (+9.25%) and Microsoft (+8.6%). Laggards were GE Vernova (-9.9%), Broadcom (-5.5%) and Cisco Systems (-5.4%).

Australasian Equity Portfolio

New Zealand shares performed well for the month, while Australian shares lagged – overall the Australasian Equity Portfolio managed to produce a positive return (+1.36%) for August.

Spark NZ (+11.5%) and Fisher & Paykel Healthcare (+9.1%) were the top performers domestically, while CSL (+41.3%) and Xero (+20%) stood out in the Ozzy sleeve.

Chorus (-5.9%) and Freightways (-5.4%) were the laggards in NZ, while Financials Westpac (-7.5%) and QBE Insurance (-7.4%) lagged across the ditch.

World Bond Portfolio

The World Bond Portfolio was flat for August (-0.02%), with regional and duration diversification helping to mitigate the impact of an overall down month for many bond sectors.

Bond markets remained under pressure as investors continued asking questions about the path of interest rates.

New Zealand Bond Portfolio

The New Zealand Bond Portfolio was largely flat for the month, returning +0.07% for August.

Like global bond markets, New Zealand bonds were affected by rising interest rate expectations, although to a lesser extent in August.

Investment Strategies

The SBS Wealth Investment Strategies all produced good results for the month, with those with heavier weights to equities leading.

The strategies continue to be a good example of how diversification works in practice. Different investments perform differently at different times, helping to smooth the overall journey for investors.

What this means for you

Staying focused on the long term

August demonstrated again the importance of remaining patient and having skin in the game, following what was overall a negative July.

Momentum returned to domestic and global shares, while Australia experienced a pullback – all normal occurrences in a complex but functioning global market. Our diversification across sectors, industries, and regions helped to smooth the ride and produce an overall good month for investors.

For long-term investors, short-term market movements are expected. What's most important is staying focused on your goals and maintaining an investment strategy that suits your timeframe and needs.

Three simple ways to stay on track

Keep market movements in perspective

Short-term ups and downs are a normal part of investing. Your investment strategy is designed to help you achieve your goals over years, not months.

Trust the value of diversification

Different investments perform differently at different times. A diversified portfolio helps reduce the impact of any one market or sector falling out of favour.

Stay focused on your goals

Your investment plan should reflect your goals, timeframe and circumstances. Periodically reviewing your settings can help ensure you are still on the right path.