POWERED BY MOMENTUM MEDIA
Bias towards overseas shares pays off for REST
REST Industry Super attributes its strong returns in its core option to an emphasis on overseas shares after it was recognised as the top performer in 2013.
Chief executive Damian Hill said the fund's overweight position to shares, and leaning towards overseas shares relative to Australian shares in particular, helped its returns, as overseas shares outdid Australian share performance.
"The valuation for overseas shares was more attractive relative to Aussie shares and other relevant asset classes," Hill said.
"In addition it allows us to diversify the portfolio from risks in Aussie shares that have significant exposure to the resources sector, which is dependent on China's economic prospects."
Hill added that the fund's exposure to foreign currency (around 22 per cent of the fund) also helped as the Australian dollar fell (-14 per cent in 2013).
"At the time, the high level of the Australian dollar provided some level of downside protection for unhedged equities. If poor outcomes occurred in overseas equities market, the downside was going to be partly offset by a drop in the Australian dollar," he said.
Super Ratings ranked REST Super's Core strategy the best performer over 2013, with a return of 19.7 per cent. It came second over a five-year period, with a 10.5 per cent return.
Chant West's superannuation fund performance survey said industry funds outdid retail funds in 2013 despite share market exposure that usually benefits master trusts. Industry funds finished at 17.4 per cent, while retail finished at 16.9 per cent.
Hill said this was due to industry funds' exposure to lower allocation to shares and higher allocation to unlisted assets such as property and infrastructure.
Recommended for you
The super fund announced that Gregory has been appointed to its executive leadership team, taking on the fresh role of chief advice officer.
The deputy governor has warned that, as super funds’ overseas assets grow and liquidity risks rise, they will need to expand their FX hedge books to manage currency exposure effectively.
Super funds have built on early financial year momentum, as growth funds deliver strong results driven by equities and resilient bonds.
The super fund has announced that Mark Rider will step down from his position of chief investment officer (CIO) after deciding to “semi-retire” from full-time work.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
76.97 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
76.46 3 y p.a(%)
3
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
51.13 3 y p.a(%)
4
Global X GlobalX FANG+ ETF
45.15 3 y p.a(%)
5
Select Baker steel Gold Institutional
43.78 3 y p.a(%)
