Volatility and your super

Thursday, 14 January 2016

You may have seen the headlines in recent days about the fall in the sharemarkets, so you might be worried about what that means for your super.

The key thing to remember is that by their nature sharemarkets are cyclical. That means that while they are going to fall sometimes, in other years you might expect to get positive returns. And super is about as long a term investment as you can get.

Of course it’s scary to watch the value of an investment fall, we get that, but most financial experts warn against changing your investment strategy when this happens, because you crystallise your loss. Or to put it another way, you miss the opportunity to make the money back if the markets start to rise again.

More certainty with QSuper

The good news for many QSuper Accumulation and Income account holders is that our Lifetime and Balanced options are not as severely impacted by the effects of market volatility as they previously were. This is due to the changes we’ve made to the way we invest your super since the global financial crisis.

Instead of looking at short-term returns, our focus is on providing you with consistent, reliable returns over the long term, giving you more certainty over where your super is headed. We do this by diversifying and increasing our weighting to assets such as bonds and real estate. We’ve also increased our investment in infrastructure (Thames Water and the Port of Brisbane being just two assets that have the potential to offer long-term stable returns), and alternative assets (which include investments such as commodities and managed funds). Essentially our goal is to make sure your super relies on much more than just the performance of the sharemarket.

If you want some more detailed information about the views of our investment team on the current global economic situation, and how its shapes our investment decisions, check out our investment blog.

Want advice?

We always recommend you get advice before making an investment decision, no matter what the markets are doing. You should always consider factors such as how long you are investing for, your personal attitude to risk, and the part your super plays in your overall investment portfolio and retirement planning goals. We offer you online advice at no extra cost to help you decide what investment option is right for you, or if you prefer to have a conversation with someone, QInvest has a range of advice options starting at just $55.

 

Each of our investment options has a different objective, risk profile, and asset allocation and past performance is not a reliable indicator of future performance.