“We haven’t seen a lot of, or any excessive, switching between funds,” he told the Herald.
“We haven’t seen a lot of people switching out a growth fund into conservative, which, for example, was a major issue during the Covid sell-down.”
Berry said the most critical thing for KiwiSaver investors was that they had the right risk exposure - conservative, balanced or growth - and to stick with it.
“If you’re a growth investor and there for the long term, just ride the ups and downs, but also be mindful that your fund manager may be able to make some tweaks to the portfolio as well,” he said.
“Your fund manager may already be doing some of the work for you but just bear in mind if you’re a growth investor, stick with the growth strategy.
“The truth is that I would expect most KiwiSaver balances for growth investors will be marginally down so far this year, but will be up from 12 months ago.
“So it’s not what’s happened in the last quarter that’s important.
“It’s thinking about not even the one-year return - the five-year return is way more important - and putting context around what the moves in the last few months mean.”
Today’s big falls needed to be viewed against the background of two good years for stock markets.
“We’ve had two really good years for returns and part of that has unwound in the first quarter, and there will be volatility at the moment with a president like Donald Trump using unconventional tools for international trade and geopolitics.
“It can create a bumpy ride, but that bumpy ride can be on the upside as well as the downside,” Berry said.
Financial market commentators have said the current trade environment could see some investment pulled out of the United States in favour of Europe.
“The US economy over time typically grows faster than Europe, which is why it’s attracted such large investment inflows, but yes there has been some rotation out of the US and into Europe,” Berry said.
A growth fund would typically have a higher proportion of growth assets, which includes shares, and which will include US shares.
A balanced fund will have a lower proportion of shares and a conservative fund will still have exposure to US equities, European equities, and Asian equities, but a lower percentage.
Berry said some KiwiSaver investors may well be looking aghast at their balances.
But he said people needed to “put the numbers aside for a second” and just make sure they are in the right risk profile.
“So number one is, before you even look at the numbers, make sure you’re in the right fund.
“Just remember that if you’re [in] a growth fund, you’re in there for the long term, and remember that this is what markets do. They go down, they go up, and what you’re after is the long-term higher return that a growth fund offers, so you stick with it.”
He added that when markets come off, it makes for cheaper buying.
“I always take people back to Covid, when the S&P 500 had been sold off by over 30% by March 2020.
“The worst thing that growth investors could have done then was switch to a conservative fund because the market bounced back faster than anyone expected and made up those losses plus more.
“That to me is an extreme example, but a really good example of getting your risk profile right and then sticking with it through the ups and downs.”
Berry, a veteran of the financial markets, said his “take” on the current state of play in financial markets was that it did not feel like a “catastrophic” turning point.
The US looked to be politically challenged, and missteps could lead to a recession.
“But a recession in the US economy is very, very different to a global financial crisis or very, very different to the complete implosion of tech stocks in the dot-com bubble.
“Markets can sell off but I don’t see it as a catastrophic moment like those events.”
Pathfinder has about $900 million in funds under management, with half that in KiwiSaver, making it one of the smaller fund managers.
Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector and energy. He joined the Herald in 2011.
