On Thursday, Cbus announced an 8.95 per cent return for its growth investment option during the 2022–23 financial year, with the fund now having $85 billion in member assets under management (AUM).
The result also took the fund’s rolling three-year average to 7.76 per cent and its average annual return since inception to 8.89 per cent.
Cbus chief investment officer Brett Chatfield said the result was achieved in the face of continued market volatility.
“The significant volatility we have seen over the last three years has continued this financial year,” Mr Chatfield said.
“The ongoing invasion of Ukraine, various banking crises, persistent high global inflation and rising rates, and political risks in the UK and US markets have helped the volatility rollercoaster to continue this year.
“Returning 8.95 per cent for members is testament to the hard work of our investment teams and the foundation we have built through our last five-year investment strategy.
“We’ve seen strong results across global and Australian equities, infrastructure, and credit this financial year. Clearly, the property sector has had headwinds, but the high quality and diversified nature of our property portfolio has limited the impact on overall portfolio returns.”
Mr Chatfield said this volatility is likely to continue, emphasising that members must continue to look at super as a long-term investment.
“Over the last six months, the likelihood of a global recession has increased, equity markets are still pricing in a rosy outlook, and as a result, we remain defensively positioned with an underweight to equities and elevated cash holdings,” he said.
“Two years ago, we had a record result of over 19 per cent, last year most funds had a small negative return and this year, results have been similar to our long-term return.
“With more turbulence on the way, I’d encourage members to be mindful that switching investment options can prove costly in the long run.
“The volatility rollercoaster of the last few years shows just how important it is to view super as a long-term investment and be careful of overacting to the various peaks and dips of the market.”
Mr Chatfield’s comments echo those of other super fund CIOs, with AustralianSuper’s Mark Delaney also urging members to focus on long-term results.
“The rebound in investment performance this financial year is an important reminder to look past short-term investment returns and focus on consistent long-term performance,” Mr Delaney said earlier this week.
“Our overall outlook suggests that we will continue to see weaker economic growth, continued volatility in investment markets and moderate returns over the next few years. This will benefit patient investors like AustralianSuper who can invest across the long-term economic cycle,” he added.
Australian Retirement Trust CIO Ian Patrick expressed a similar sentiment, adding the fund’s proactive and robust approach to valuations will act as a springboard for future success.
“It is important to always remember that super is a long-term investment and Australian Retirement Trust’s Super Savings Balanced option has delivered a return of 8.4 per cent over 10 years until 30 June 2023,” Mr Patrick said.
“Our investment team’s expertise and experience enables us to deliver solid and competitive investment returns to our members over the long-term.”