Karaoke, conflict, and cash: Kiwi wealth is riding a chaotic wave of fear

Saturday, 11 April 2026

The uncertainty caused by the war in the Middle East is central to these concerns, but there’s also more going on. Stuff Money Editor Damien Venuto explains.

ANALYSIS: Here are two significant moments that capture the veritable market chaos we’ve seen since the start of the year.

The price of Brent crude oil has gone as high as US$128 per barrel, before plummeting to as low as US$96 amid the fragile ceasefire announcement.

And while the gaze of the world has since shifted to the war, it wasn’t long ago that a single whitepaper from Algorhythm Holdings – a former karaoke machine manufacturer, I kid you not – wiped US$17.5 billion from major US logistics firms.

Algorhythm, a company worth only US$3 million at the time, claimed that its AI-enabled logistics platform, SemiCab, had the potential to reduce both trucking volume by 30% and deadhead travel (journeys with empty trailers) by 70%.

This is what market fear looks like. And it’s little surprise to see the latest edition of the Sharesies Index (which ranks overall investor confidence) drop from 64 to 45 by the end of March.

The uncertainty currently gripping the global marketplace is eating at the confidence of local investors who are trying to build their long-term wealth.

So what do you do in a world where today’s two-week ceasefire becomes tomorrow’s missile barrage? Or where a small paper published by an obscure company with a background in karaoke becomes the song sheet fearful investors sing from?

The war isn’t the only thing moving your money

Jordan Cunningham, the data and analytics boss at Sharesies, tells me that despite the chaos we’ve seen in 2026, investors aren’t withdrawing their funds.

The withdrawal ratio shows a total of $2.38 was deposited for every $1 withdrawn.

As the war in Iran sends markets into a slump, Damian Venuto joins Lisette Reymer to discuss why timing the market is a dangerous game and why history suggests investors should simply 'hold the line.'

“I think some investors are getting more comfortable with volatility, while others will be actively pursuing opportunities as some sectors came under pressure,” Cunningham says.

With so much New Zealand money still moving into the share market, remember that the headlines we see tell only part of the story.

Harry Smith, a portfolio manager at Fisher Funds, tells me that, looking at the news, it’s easy to assume the Iran war is currently the only thing moving the market.

But this simply isn’t true.

“We elevate the really negative headlines, but it's important to know that there's a whole range of different scenarios or potential outcomes impacting the market in any one year and to weight those accordingly,' Smith says.

Fisher Funds’ Harry Smith reminds us to look at the broader historical context.

These scenarios include the war, but the undercurrent of themes influencing AI investments remains just as important.

“The softness we’ve seen in big tech isn’t caused by the war, it’s caused by the themes playing out in the AI space,” Smith says.

Investors are starting to ask more pressing questions on what the big tech companies actually have to show following the billions of dollars poured into AI stocks.

Microsoft (down 25%), Tesla (down 30%), Nvidia (down 14%), Apple (down 12.2%) and Amazon (down 14.4%) have dropped from their peaks as scrutiny grows.

More broadly across the market, investors are also starting to dump stocks that mention AI without showing evidence of monetisation.

This isn’t about the war, but rather what Smith refers to as “a rational repricing of risk” – meaning investors are no longer willing to pay a premium for speculative future rewards.

The good news through this is that Kiwi investors are starting to think more broadly and are looking beyond the tech-heavy US stock markets, with Sharesies data showing both the Vanguard Index of International Shares and the Smart Total World exchange-traded funds moving up the ranks of the most popular investments on the platform.

“With the concerns around an AI bubble and high valuation risks, people are looking quite closely at what they see as value,' says Cunningham.

The safe option is still risky

There has also been an uptick in investors opting for the relative safety of cash rather than immediately investing in shares.

This seems logical on the surface, given that cash is often regarded as a safe haven in times of uncertainty.

But the inflation rate isn’t dictated by logic.

Reserve Bank Governor Dr Anna Breman warned this week that inflation will climb to 4.2% by the middle of the year.

This erodes your purchasing power. It’s a timely reminder: cash is only 'safe' if you are comfortable losing value to inflation.

Hoarding cash can make sense if you’re looking to buy something in the near future, but if you don’t want to go backwards, you essentially have to ensure that your investments are outpacing inflation on a year-to-year basis.

Jordan Cunnigham is the head of data and analytics at Sharesies.

Another investment that has gained in popularity is gold, with the Sharesies index showing the Smart Gold ETF climbing a staggering 16 places up the ranks of the most popular investments on the platform.

Gold is another so-called safe-haven investment – but also another warning that safe-haven doesn’t mean safe.

Despite the war raging on, the price of gold slumped 19.6% by late March, proving that even the epitome of a safe-haven asset can be rocked when the circumstances evolve.

War is more common than you think

In reflecting on the last three months, Smith offers a sobering reminder that the history of the world has always been chaotic.

“Since 1928, markets have delivered a positive year 73% of the time,” he says.

Conflict, says Smith, broke out in 23 of those years, and even then, the market finished in the green 65% of the time.

The chaos can feel disorienting in the moment, but Smith’s advice is that every generation goes through this at some point.

Perspective is elusive because our brains are wired to feel the sting of loss far more acutely than the thrill of gain. Smith notes that researchers into loss aversion bias have found that the psychological impact of a loss is roughly two times as potent as a gain.

That’s why we so quickly forget the gains we make on our KiwiSaver and fixate on the moments when our balance slides.

So, how worried are you about everything happening in the world right now? And how has this affected your investing strategy? Let us know in the comments section below.