Newsletter September 2007
The September 2007 Milford Report highlights that some finance companies are in strife because they have been too reliant on the retail market as individuals were willing to lend them money at particularly low interest rates. Finance companies that have developed a more diverse funding base, with a mix of retail and wholesale money, are in a better position to weather the storm.
Milford Asset Management has not invested any client money in finance company debentures because of the low interest rates on offer (relative to their risk), poor disclosure, absence of credit ratings and the inability to sell these securities on a secondary market.
However, finance companies play an important role in the domestic economy and they will be attractive again when disclosure improves, credit ratings are obtained, a better regulatory regime is in place and a secondary market for debentures is developed.
The Milford KiwiSaver Plan has two KiwiSaver Funds available to New Zealand investors: The Milford Aggressive KiwiSaver Fund and The Milford Balanced KiwiSaver Fund. Click here to switch to Milford.
We have four PIE registered Funds: The Milford Balanced Fund, The Milford Aggressive Fund, The Milford Peak Fund and The Milford Income Fund.
Individually Managed Accounts (IMAs) are portfolios of investments tailored to clients risk profiles and requirements for growth, income and capital preservation.