The last 12 months have seen continued economic, political, and financial uncertainty. The ongoing war in Ukraine, the global energy crisis, rising inflation, and rising interest rates in most major economies have led to significant increases in the cost of living for most Australians and increased volatility in financial markets.
Central banks have been aggressively raising interest rates to address rising inflation meaning that bonds, a traditionally lower risk asset class, have suffered capital volatility as yields have risen sharply. Energy and wage price pressures will continue to contribute to high inflation with a heightened risk of recessionary conditions across the western economies.
However, against this background of ongoing short-term uncertainty, it is important to remember that superannuation is a long-term strategy to help fund your retirement over an extended investment horizon.
For the 12 months to 30 June 2023, we are happy to confirm that our Balanced (MySuper) investment option achieved a net investment return of 9.45%. This result was achieved by a higher exposure to listed assets – Australian shares and International shares – and a lower exposure to unlisted property. Similarly, the Balanced Pension investment option achieved a net investment return of 10.97%.
Over the same period, our Growth investment option achieved a net investment return of 13.77% also driven by the option’s higher exposure to strong-performing listed assets. This is an excellent result.
Average annual net investment returns over the past 10 years
The Balanced investment option invests mainly in growth assets with some interest-bearing defensive assets. It has the potential for high returns – demonstrated by the 20.0% net investment return for the 12 months ended 30 June 2021.
It is important to remember that the core fundamentals of superannuation remain the same – long-term real growth and this reinforces the need to focus on long-term investment strategy and objectives. The Balanced investment option has a performance objective of returning at least CPI plus 3% per annum over 10 years.
REI Super continues to provide members with strong, long term investment returns with the Balanced investment option achieving average net investment returns of 6.84% per annum over 10 years.
………………………………………………………………………………………….
Past returns are no guarantee of future performance, and investment returns of one year should not be relied upon as any guide to future performance. Furthermore, you should not base your decision to invest in REI Super solely on past performance. Past earning rates are not an indicator of future earning rates. The investment returns of REI Super are not guaranteed, and the value of the investment may rise or fall.
The information contained in this article does not constitute financial product advice. REI Super does not give any warranty to the accuracy, completeness or currency of the information provided. Although REI Super makes every reasonable effort to maintain current and accurate information, you should be aware that there is still the possibility of inadvertent errors and technical inaccuracies. REI Superannuation Fund Pty Ltd ABN 68 056 044 770, AFSL 240569, RSE L0000314 Trustee of REI Super (ABN 76 641 658 449), SPIN REI0001AU, RSE R1000412. MySuper unique identifier 76641658449129