Your investments performed well over the past year, but 2018 has been challenging, explains Mark Rider.
- Lifestage options recorded solid gains in the 12 months to the end of March 2018.
- Sharp dips in the sharemarket in February and March 2018 lowered performance.
- Company profits support sharemarkets, but we expect higher volatility this year.
- Take a long-term view of your super and consider steps to boost your balance.
As Mark Rider, chief investment officer, explains in the video above, there's been plenty of turbulence in the sharemarket so far this year. However, we can tell you in this update on ANZ Smart Choice Super performance that despite those recent dips, your returns are tracking at a solid level in the 12 months to March 31, 2018.
As you can see in the table below, returns for the past 12 months ranged from 7.14 per cent for those born in the 1990s, through to 3.45 per cent for the more conservative 1940s investment option, in an environment where some global shocks to investor confidence reduced the value of shares in February and March 2018.
(Before we get into more detail, a quick reminder: it’s always a good idea to have a long-term view on your super – it goes up and down to some extent, but in the long-term tends to steadily track higher.)
Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees. Reporting data is to March 31, 2018 (p.a. = per annum). Past performance is not a reliable indicator of future performance. The inception of the 2000s fund was on February 18, 2017 and therefore there is no performance data available for three and five years.
In the '1 year' column you can see how much your fund grew between April 2017 and March 2018. The '3 months' column shows returns for the first quarter of this year (January to March). In the last column, '5 years' you can see the average annual returns for the past five years.
Our members belong to investment options based on their decade of birth. Younger members' savings are mostly allocated to 'growth assets' (higher risk investments with higher potential returns), while 'defensive assets' (lower return investments with greater stability) start to make up a larger share as members age.
Major sharemarkets around the world experienced a sharp dip in February 2018 when investors started selling stocks due to fears of rising inflation in the US. Then, in March, President Donald Trump’s move to raise trade barriers also shook markets and following that, major tech stocks fell in reaction to Facebook admitting a significant privacy violation.
The Australian sharemarket experienced similar dips, reacting negatively to the global news.
Snapshot of market performance: Click to view (infographic)
I’m in the choose your own investment mix. How did my funds fare?
With the exception of the global property option, ANZ Smart Choice members who chose their own investments generally saw positive returns for the 12 months ending March 2018. (Results for the different assets are in the table below.)
The best performing investment was the global smaller companies option, which delivered a 13.24 per cent return. This was followed by international equities (unhedged) at 11.79 per cent for the year to March 31, 2018 and international equities (hedged) at 9.58 per cent.
For those in multi-asset options, the annual returns ranged from 2.96 per cent for the conservative fund through to 5.8 per cent for the growth option.
Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. All returns are after the deduction of investment fees. Reporting data is to March 31, 2018 (p.a. = per annum). Past performance is not a reliable indicator of future performance. Note the Australian Fixed Income fund’s inception was on 18th February 2017 and therefore the three and five year performance data is not available. Similarly, International Equities (unhedged) and the Global Smaller Companies started on the 25th May 2015 so the three and five year performance data is not available. The Global Small Companies investment option is not available to members of ANZ Smart Choice Super and Pension.
Members of ANZ Smart Choice Super for employers and their employees can access the latest returns across the full suite of investment choices online or by visiting the ‘Investment portfolio’ page via their ANZ Smart Choice Super account in ANZ Internet Banking.
(Note: The above investment returns are not applicable to QBE members. These members can access their individual returns via ANZ Internet Banking.)