Changes to our investment options
From 1 April 2022
We conduct yearly reviews of our investment options to make sure they’re set up in the best way to deliver for our members. On 1 April 2022, we made changes to a number of our investment options.
Changes to return objectives
We are reducing the long-term return objectives for Aggressive, Take-off, and Thrifty options.
The reduction is based on our long term view of market conditions and what returns we believe we can achieve for members over the stated investment timeframe.
| Investment option | Old objective | New objective |
|---|---|---|
| Aggressive | CPI + 4.5% p.a. over 10 years | CPI + 4.0% p.a. over 10 years |
| Glidepath: Take-off | CPI + 4.5% p.a. over 10 years | CPI + 4.0% p.a. over 10 years |
| Thrifty | CPI + 3.5% p.a. over 7 years | CPI + 3.0% p.a. over 7 years |
Changes to risk levels
Each of our investment options is designed with a particular level of risk in mind, with the level of risk typically correlating to the potential for reward. One of the ways we measure risk is by calculating the estimated number of negative annual returns each option may see over any 20 year period and, in turn, assessing the risk of each option on a scale from 1 to 7.
We are amending the standard risk measures of a number of our options to better reflect expectations for investment market risk.
| Investment option | Old standard risk measure (1-7) | New standard risk measure (1-7) | Old estimated number of negative annual returns | New estimated number of negative annual returns |
|---|---|---|---|---|
| Glidepath: Take-off | 6 | 6 | 4.7 | 5.5 |
| Glidepath: Cruising | 5 | 6 | 3.3 | 4 |
| Glidepath: Destination | 4 | 5 | 2.7 | 3.5 |
| Aggressive | 6 | 6 | 4.7 | 5.5 |
| Growth | 6 | 6 | 3.8 | 4.5 |
| Balanced | 4 | 5 | 2.7 | 3.5 |
| Conservative | 3 | 4 | 1.6 | 2.5 |
| Thrifty | 6 | 6 | 4.6 | 5 |
Note: The version of this table mailed to members in April 2022 incorrectly stated 6 as the new standard risk measure for Glidepath: Destination.
Adjustments to foreign currency exposure
Investing in assets outside Australia, such as shares listed on foreign stock exchanges, means the value of those assets can change as the value of foreign currencies change. All investment options (with the exception of the Cash option) have exposure to global assets, and therefore to movements in exchange rates.
We are adjusting our foreign currency exposure limits, which will improve our ability to achieve our investment return objectives.
| Investment option | Old range (%) | Old strategic foreign currency exposure weight (%) | New range (%) | New strategic foreign currency exposure weight (%) |
|---|---|---|---|---|
| Glidepath: Take-off | 22 - 58 | 40 | 24 - 51 | 37.5 |
| Glidepath: Altitude | 16 – 44 | 30 | 18 - 37 | 27.5 |
| Glidepath: Cruising | 15 – 40 | 27.5 | 16 - 34 | 25 |
| Glidepath: Destination | 14 – 36 | 25 | 15 - 30 | 22.5 |
| Aggressive | 22 – 58 | 40 | 24 - 51 | 37.5 |
| Growth | 16 – 44 | 30 | 18 - 37 | 27.5 |
| Balanced | 14 – 36 | 25 | 15 - 30 | 22.5 |
| Conservative | 8 – 22 | 15 | 8 - 17 | 12.5 |
| Thrifty | 37 – 43 | 40 | 37 - 43 | 40 |
| Cash | 0 - 0 | 0 | 0 - 0 | 0 |
Changes to the Cruising option
We are making a number of changes to the Cruising option.
Reducing the investment timeframe
Each of our options is designed with a particular investment time horizon in mind, that is, the length of time over which it will achieve its return objective.
We are reducing the investment timeframe for Cruising from 6 years to 5 years, to bring this option in line with the industry standard. This will make it easier for members to compare the performance of Cruising with similar options across different super funds.
Changes to the asset allocation ranges
Your super investments are categorised into four asset classes: equities, alternatives, fixed interest, and cash. Each of our investment options has a different strategic allocation to these asset classes, which is chosen with the aim of achieving our investment return objectives. The actual allocation to each asset class will be within an asset allocation range and typically varies with investment decisions and market movements. The range defines the minimum and maximum amounts we invest in each asset class.
To align with reducing the investment timeframe for Cruising, we are also shifting the strategic asset allocation for this option.
| Asset class | Old strategic asset allocation (%) | New strategic asset allocation (%) | Old range (%) | New range (%) |
|---|---|---|---|---|
| Equities | 50 | 47.25 | 35 - 65 | 32.25 – 62.25 |
| Alternatives | 18 | 20.00 | 3 - 33 | 5 - 35 |
| Fixed interest | 24 | 24.75 | 9 - 39 | 9.75 – 39.75 |
| Cash | 8 | 8.00 | 0 - 23 | 0 - 23 |
We're here to help
If you need help with making a decision about your super, you can get simple advice over the phone or face to face. It’s included as a part of your membership so there’s no extra cost.