Australia, NZ state funds: lower returns ahead

The Australian and New Zealand flagship sovereign funds expect their performance to drop in the coming year given the tougher investment climate, and the former has been steadily de-risking its portfolio.  Australia's A$118.4 billion ($84 billion) Future Fund returned 8.4% for calendar year 2015, but performance in recent months confirms the board’s view that markets are getting harder to navigate. Long-term performance has been consistently exceeded target returns (see chart be…