NZ Super Lagged Its Passive Benchmark by 0.10 Points: How to Write Outreach to an LP That Measures You Against One

The NZ Super Fund returned 14.17% in the year to 30 June 2026 and finished 0.10 percentage points behind its passive Reference Portfolio, a notional mix of 80% global equities and 20% fixed income. The Guardians of New Zealand Superannuation, which manages the fund, published its 2026 annual report on 19 October. We set out the numbers in our note on the fund's lower long-term return expectation, and this piece turns them into advice on how to write to an LP that judges itself against a passive yardstick. It is our advice, not guidance from the Guardians. We have not verified how the fund handles unsolicited approaches from managers, so check its published policies before you write.

Start from the benchmark the LP uses

The Guardians measure the fund against the Reference Portfolio and report the value it adds above a passive investor with the same appetite for risk. Chief executive Jo Townsend has said the fund will keep being judged on the value it delivers for taxpayers. An outreach email that speaks in those terms will read as written for this reader. Give your net return against a public-market equivalent for your last fund, state what that equivalent was, and say whether the comparison is by time-weighted return or by cash flow. A manager who says "we returned 18% net" without a yardstick leaves the reader to build one, and an LP that has just reported it lagged its own passive portfolio by 0.10 points is likely to build a demanding one.

Lead with the number the LP cares about

The Guardians lowered the fund's long-term expected return to 7.2% from 7.8%, citing a view that global equities are overvalued. A fund that expects roughly 7% from a diversified, liquid portfolio will ask what an illiquid commitment adds. One sentence is enough: your net target, the spread over a public equity equivalent, and how your last fund behaved when listed equities fell. Use only numbers you can document in a DDQ, because a sovereign reader will check them. If your fund is a strategy that diversifies equity risk, such as real assets, credit or timber, say so in the first line, since the fund holds timber, real estate and private market investments.

Show costs and scale

The fund reports its return after costs, so show yours the same way: management fee, expected fund expenses and the total cost to the LP in one place. Scale matters too. The Guardians project the fund will reach NZ$200 billion by 2040 and say they restructured their investment team to make its way of working more scalable. A small fund should say plainly what ticket it can absorb, whether it offers co-investment, and how a modest commitment could still matter to its performance. Do not hide capacity limits; stating them early saves both sides time.

Match the asset class and the policy

Put the strategy in the subject line so the note reaches the right desk. If your strategy is climate impact, name the targets it supports and how you measure them. The annual report says the Guardians aim to grow climate-related impact allocations while reducing risk exposure, and that they have reformulated their Sustainable Investment Policy, in a report that also addresses court proceedings. Read that policy before you write, and never claim your fund meets it unless you have checked each point.

A workable opening

Keep it to a few lines: "[Fund name] is a [size] [strategy] fund, fund number [x]. Our previous fund returned [y] net, [z] points ahead of a public-market equivalent, with [w] of invested capital already distributed. I am writing because the Guardians have lowered their long-term return expectation to 7.2%, and our fund targets [n] net with [correlation figure] to listed equities. Could we have 20 minutes, or would you prefer a DDQ first?" Replace every bracket with a documented figure, and send nothing else on the first note.

Prepare the follow-up pack

Have a current DDQ, a track record by vintage that shows distributions to paid-in capital as well as total value, a fee and expense schedule, a one-page capacity note and a short summary of your climate or sustainability policy. Our guide to the LP diligence pack lists what such a package normally holds. For a sovereign investor that benchmarks against public markets, add the public-market equivalent you used and the data behind it.

What to leave out

Leave out any claim to beat the market with no stated benchmark, any use of the fund's recent return as evidence that it wants your strategy, and any request that touches how the fund selects managers. Do not send marketing decks as attachments, and do not follow up more than once a quarter unless you have fund-specific news. We covered a related approach in our piece on what to send a CIO after an endowment results season, and the logic of leading with the LP's own return assumption is the same one we described in our playbook for pitching an endowment with a lower hurdle.

What to watch next

Watch for the fund's next published update and for any sign of how the restructured investment team engages managers. FundLinx members can see which sovereign investors are active in your strategy.

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