AustralianSuper’s ‘Balanced’ investment option returned 12.44%, after taxes and fees, in 2016/17.
“The strong result was a consequence of a stronger global economy, with global equity markets performing particularly well. This was supported by solid results from AustralianSuper’s other diversified assets such as infrastructure,” said AustralianSuper.
“This was the eighth consecutive year of positive returns since the global financial crisis and the fourth year out of five that the Fund has delivered double digit returns for members.”
Around 90% of AustralianSuper members are in the Balanced option.
Deputy Chief Executive and Chief Investment Officer, Mark Delaney, said the strong returns came about because all asset classes produced positive returns.
“The return to above-average performance reflects the improving global economy, particularly in China and the US. Investment markets have been resilient in the face of greater political uncertainty,” he said.
‘It’s a great result for our more than 2.2 million members and it shows the benefit of active management as well as our program to internalise the management of our assets.”
Though he was pleased with the result, he also warned that members should be focused on longer term returns, not short term fluctuations.
“The diversified nature of our Balanced option has allowed us to manage market ups and downs over the long term,’ he said.
“It’s the breadth of the asset classes that we invest in and our active management of these investments that helps create sustainable long-term returns for members.”
Mr Delaney said around $26 billion of the funds assets, or around 22% of the $120 billion in the fund, are now managed internally and he expects this to increase in coming years. He said the internal investment team are outperforming external managers.
“Internal management will help us to reduce costs, give the Fund the ability to be more agile in the way we invest and enable us to continue to invest in high quality assets.”