POWERED BY MOMENTUM MEDIA
Diversification ‘cushioning the blow’: ART
With average super returns falling by 4.3% in 2022, Australian Retirement Trust (ART) has stressed how well-diversified portfolios can combat market volatility in 2023.
On a recent investment market update podcast, ART’s chief economist, Brian Parker, described the past year as a “challenging time for markets and certainly a really worrying time for many of our members”.
Parker reminded ART members that superannuation was a long-term investment game, following the super fund’s negative performance during 2022.
“Even though there’s potentially light at the end of the tunnel, it's still going to be a challenging time for the next little while,” he continued, noting geopolitics as a key source of global volatility in 2023.
Despite this, high levels of Australian consumer spending, alongside European and US investment performance, were reasons for optimism when looking ahead.
“Generally speaking, the economy is holding together a lot better than we might have thought a few months ago,” Parker said.
Diversification in asset classes was a crucial tactic to combat further volatility, setting up the fund for medium to long-term returns. The economist explained that this would additionally uphold investment objectives communicated in product disclosure statements.
Parker added that ART would take advantage of weaker share prices, buy into bond markets when yields rose and focus on alternative assets such as property and infrastructure.
“[These assets] tend to help cushion the blow during difficult financial market conditions,” he said.
Investment flows towards airports were also identified to see further recovery, as ART members could benefit from the increasing number of flight passengers.
Parker urged members who felt extremely worried about market conditions, particularly those approaching retirement, to seek financial advice.
mso-fareast-language:EN-GB">
AUTHOR
Jasmine Siljic
Jasmine Siljic is a cadet journalist at Money Management and Super Review. Prior to joining MM and SR, she also worked across other Momentum Media brands as an intern. Jasmine previously completed an internship at Mamamia news. She is currently studying a Bachelor of Media and Communications at Macquarie University.
Recommended for you
Jim Chalmers has defended changes to the Future Fund’s mandate, referring to himself as a “big supporter” of the sovereign wealth fund, amid fierce opposition from the Coalition, which has pledged to reverse any changes if it wins next year’s election.
In a new review of the country’s largest fund, a research house says it’s well placed to deliver attractive returns despite challenges.
Chant West analysis suggests super could be well placed to deliver a double-digit result by the end of the calendar year.
Specific valuation decisions made by the $88 billion fund at the beginning of the pandemic were “not adequate for the deteriorating market conditions”, according to the prudential regulator.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.56 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.06 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
26.81 3 y p.a(%)
