QSuper: Return objective exceeded
26 July 2018
4
min read
QSuper’s Balanced Option has exceeded its return objective for the 9th consecutive year, making it one of only a small number of major Australian funds to achieve this.
With more than 87,000 Accumulation members having at least some funds invested in QSuper’s Balanced Option, the news that the return objective has been exceeded again means more money working for their retirement.
Since 2009, QSuper’s Balanced Option has returned between 1% and 5% above its current CPI-plus 3.5% target at 30 June, including the highest return of all Balanced Options in 2012 and 2016.1
The Option has returned 6.87% this financial year, with a 10-year performance of 6.75% per annum.
The news follows a recent Roy Morgan survey2 finding that QSuper is ranked highest by members among the 15 largest super funds for satisfaction with financial performance.
CEO Michael Pennisi said while in any given year the Fund’s annual returns might look different to the rest of the industry, this was by-design.
“Super is not a one-year proposition. We made a conscious decision post the GFC that a focus on one-year performance relative to other funds was not what our members sought nor was it of benefit to them. Rather, our focus is squarely on delivering more stable, long-term returns – in line with our members’ expectations. This gives them more confidence that when they’re ready to retire, their super will be ready too,” Mr Pennisi said.
“One of the things I’m most proud of is that we are delivering comparable long-term returns to other Balanced Funds but with around 30% less risk.
Chief Investment Officer Brad Holzberger said the QSuper Balanced Option had a highly diversified investment strategy compared to many funds.
Approximate percentages - QSuper has the flexibility to invest within predetermined ranges.
“We don’t rely as heavily on the performance of the share market or any one asset class to produce solid returns for members – we see a 60% to 70% allocation to equity as a big bet which may pay off when markets are strong but could be equally costly for members when markets fall.
“While equities have been strong in recent years, it remains difficult to forecast how long this can be sustained.
“Our members tell us they don’t want to take on high risk for big returns, so rather than speculating with members’ money on what the market may or may not do, we work very hard to ensure as best we can that their investments are well prepared to weather whatever may come,” he said.
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1 SuperRatings SR50 (60-76% Growth) Index. Returns data to 30 June 2017.
2 Roy Morgan, 18 June 2018, Finding No. 7629, accessed 18 June 2018 at http://www.roymorgan.com/findings/7629-industry-funds-satisfy-top-investors-201806180201
3 Chant West Performance Report October 2017: Before admin fees and compares the performance and volatility (standard deviation) of QSuper’s Balanced option with Chant West’s Multi-Manager Growth (61 to 80% allocation to growth assets) median over 3, 5 and 7 years to June 2017.