AMP Capital is warning investors not to expect similar returns to those they received last year year.
The fund manager says that last year, growth assets such as shares were attractively priced and political, financial and economic hurdles were averted, so investors were rewarded for taking risk.
It says Australia has underperformed New Zealand in the past few years, and the market has had a higher dividend yield than Australia. Domestic stocks are also generally less exposed to the global cycle.
AMP head of investment strategy Keith Poore says this could turn this year as New Zealand is now not as undervalued as some overseas equity markets.