The Australian Retirement Trust has achieved double-digit returns across many of its investment options with the fund also optimistic it will continue to generate substantial returns for members in the new financial year.
Speaking to InvestorDaily, ART general manager of total portfolio management and resilience, Andrew Fisher, said FY24–25 was another year of strong performance for the fund.
The fund’s default investment option for accumulation accounts, the Lifecycle Investment Strategy, achieved a return of 11.2 per cent for the balanced pool option and 11.9 per cent for the high growth pool over FY24–25.
“We had calibrated ourselves five years ago to a zero interest rate world and thought these kinds of returns were unachievable, but we’re now in a much more normalised interest rate world,” Fisher said.
Over the past five years, Fisher said the key factors driving the performance of the fund have changed year to year.
“Coming out of COVID, it was private equity [driving that performance], then as inflation spiked following COVID, it was real assets and then in the past couple of years global equities have really stood out,” he said.
“In the most recent financial year, it was more of a domestic exposure. Australian equities and domestic infrastructure were two of the biggest drives of that relative outperformance.”
Domestic infrastructure assets had a particularly strong year, according to Fisher.
“Airports did really well and data centres were also a really attractive place to invest. AirTrunk received a lot of publicity over the year and was one of our more successful investments over the year,” he said.
Looking ahead to FY25–26, Fisher said while double digit returns may not be realistic, the fund is confident it can achieve at least an 8 per cent return for next year.
“Interest rates remain relatively attractive and bond yields look quite good relative to interest rates,” he said.
“Equities look reasonably good other than a few overpriced stocks and a bit of concentration in some markets. We’re also confident that unlisted assets will [be able to generate] strong yields.
“We’re going into this new financial year relatively optimistic.”
