In the year to June 2026, Fisher Funds' two listed investment vehicles — Marlin and Barramundi — delivered returns that fell sharply short of their respective benchmarks, raising enduring questions about the promise and peril of conviction-based active management. Marlin's 39-percentage-point gap against its benchmark stands as a reminder that the same concentrated bets that can generate outsized gains can, in the wrong season, extract a heavy toll. Markets, like tides, do not always reward those who read them with confidence, and the distance between a manager's conviction and the market's di
Fisher Funds' managed funds post losses as benchmarks surge 30%
Being genuinely active means you can be very wrong
Mark
So Marlin lost money while its benchmark gained 30 percent. How does that even happen?
Mimi
The fund was positioned for quality stocks and missed the AI and cyclical rotation. When the market surges in those areas and you're not there, you get left behind.
Luke
But we should be clear—the fund didn't just underperform. It actually lost money in absolute terms. That's $17.3 million gone.
Mark
And Barramundi?
Mimi
Barramundi lost $42.9 million, though it did post a positive return. The issue is the absolute loss to shareholders, not just the benchmark gap.
Luke
Right. And we don't have detail on exactly which stocks or sectors caused the losses. We know the rotation happened, but the specific picks that went wrong aren't named in the reporting.
Mark
Why would they bet against AI stocks in 2026?
Mimi
They were focused on quality businesses with sustainable competitive advantages. That's a legitimate strategy. The problem is the market didn't reward it that year.
Luke
The fund manager says quality stocks underperformed to dotcom bubble levels and valuations are now attractive. That's a forward-looking claim, not a fact about what happened.
Mark
So is this a sign active management doesn't work?
Mimi
Not necessarily. Anderson points out they were genuinely active, not just tracking an index. The risk of that conviction is exactly what we saw—you can be very wrong.
Luke
The real question is whether shareholders will stick around to see if the recovery thesis plays out, or if they'll redeem their units now.
The Pulse
- Marlin lost $17.3 million and returned -8.5% while its benchmark surged 30.5%, a 39-percentage-point shortfall that is among the starkest active management gaps seen in recent New Zealand investment history.
- The fund's undoing was a decisive bet against the year's dominant theme — the AI-driven rally and rotation into cyclical stocks — a positioning error compounded by individual stock picks that also failed to deliver.
- Barramundi's situation is more ambiguous: an 18.2% adjusted return beat its 9.2% benchmark on paper, yet shareholders still absorbed a $42.9 million absolute loss, a tension that cuts to the heart of how fund performance is measured and communicated.
- Fisher Funds has conducted a comprehensive internal review and argues that quality-stock underperformance has reached dotcom-era extremes, positioning current valuations as a potential springboard for recovery.
- Independent voices like Kernel's Dean Anderson acknowledge the legitimacy of genuine active management while warning that concentrated strategies carry real and asymmetric downside when conviction meets an uncooperative market.
In the year to June 2026, Fisher Funds' two listed investment vehicles — Marlin and Barramundi — delivered returns that fell sharply short of their respective benchmarks, raising enduring questions about the promise and peril of conviction-based active management. Marlin's 39-percentage-point gap against its benchmark stands as a reminder that the same concentrated bets that can generate outsized gains can, in the wrong season, extract a heavy toll. Markets, like tides, do not always reward those who read them with confidence, and the distance between a manager's conviction and the market's direction can become the measure of a very costly year.
Fisher Funds' two listed investment vehicles endured a punishing twelve months to June 2026. Marlin, which holds international equities, lost $17.3 million and returned negative 8.5 percent to shareholders — while its benchmark, the S&P Large Mid Cap/S&P Small Cap Index hedged 50 percent to New Zealand dollars, gained 30.5 percent. That 39-percentage-point gap is the story's sharpest edge.
Barramundi's year is harder to read. The Australian-focused fund lost $42.9 million in absolute shareholder value, yet its adjusted net asset value return of 18.2 percent outpaced its ASX200 benchmark's 9.2 percent. Whether that counts as success depends on which number an investor chooses to hold.
Board chair Fiona Oliver acknowledged disappointment in both annual reports, noting that the board was working with the fund manager to improve positioning. For Marlin, she was more direct: the result was not good enough, and remediation was underway.
Senior portfolio manager Ashley Gardyne traced Marlin's difficulties to a single, costly misjudgement — the fund was positioned away from the year's dominant trade, the surge in artificial intelligence and cyclical stocks. Sector headwinds and individual stock selections compounded the damage. Gardyne argued the firm had reviewed its process thoroughly and maintained that quality businesses with durable competitive advantages remain the right long-term bet. He pointed to the current underperformance of quality stocks as historically extreme — comparable to the dotcom era — and suggested that attractive valuations now set the stage for recovery.
Dean Anderson of Kernel offered a measured outside view. Active managers are paid to take genuine positions, not to shadow an index, and Fisher Funds was doing exactly that. But the same conditions that give active management its purpose — wide dispersion between winners and losers — are the conditions that punish wrong calls most severely. In 2026, Fisher Funds called it wrong, and their shareholders bore the cost.
Fisher Funds manages two listed investment vehicles that faced a brutal year in the twelve months to June 2026. Marlin, which invests in international equities, lost $17.3 million and delivered a negative 8.5 percent return to shareholders. The problem is not that markets were weak—Marlin's benchmark, the S&P Large Mid Cap/S&P Small Cap Index (50 percent hedged to New Zealand dollars), returned 30.5 percent. The gap between what the fund lost and what its benchmark gained is the story: a 39-percentage-point shortfall that raises hard questions about active management and conviction investing.
Barramundi, the second Fisher Funds vehicle, tells a similar tale of underperformance. It lost $42.9 million over the same period, though it did post an 18.2 percent adjusted net asset value return. Its benchmark—the ASX200, 70 percent hedged to New Zealand dollars—returned only 9.2 percent, so on the surface Barramundi beat its index. But the absolute loss of $42.9 million in shareholder value is the number that matters to investors who held the fund.
Fiona Oliver, chair of both investment vehicles, declined to speak on the record but issued statements acknowledging the disappointment. In Barramundi's annual report, she described the year as challenging and said the board was working with the fund manager to improve positioning. For Marlin, she was more direct: the board was disappointed with performance and was working to remedy the situation.
Ashley Gardyne, senior portfolio manager at Fisher Funds, explained the mechanics of the failure. Marlin had bet wrong on the market's biggest move of the year—the surge in artificial intelligence stocks and cyclical equities. The fund's portfolio was positioned the opposite way, and additional headwinds came from sector positioning and specific stock picks that did not work out. Gardyne said the firm had undertaken a comprehensive review of its portfolio and its investment process. He argued that owning quality businesses with durable competitive advantages remains the right long-term strategy, and he pointed out that the underperformance of quality stocks has reached levels not seen since the dotcom bubble. History, he suggested, shows such periods do not last, and with valuations now attractive, Marlin should be positioned for recovery.
Dean Anderson, founder of Kernel, offered a different perspective. He acknowledged that Fisher Funds was doing what active managers are supposed to do—being genuinely active rather than simply tracking an index. Investors pay fees for conviction and differentiation, not for index-hugging. But the same market environment that creates opportunity for active managers—a wide spread between best and worst-performing stocks and sectors—can equally create disaster. When a manager is trying to pick a small number of stocks without full diversification, the risk of getting those picks wrong is substantial. In 2026, Fisher Funds got them wrong, and shareholders paid the price.
Notable Quotes
Marlin was on the wrong side of this extreme rotation, with additional headwinds from the portfolio's sector positioning and some stock-specific issues.— Ashley Gardyne, senior portfolio manager, Fisher Funds
When you're trying to pick a small number of stocks and aren't fully diversified, the risk that you get those wrong is meaningful.— Dean Anderson, founder of Kernel
Want the full story?
Read the original at RNZ ↗