Strong first quarter investment returns for members
Over the first quarter of the 2021-22 financial year, we’ve seen the continued progress of COVID-19 vaccine rollouts around the world – with Australia now having reached its first major national milestone – which has continued to drive economic recovery, although patchy across different industries and markets.
Media Super has been well positioned for this recovery, and for the financial year to 30 September the Balanced (MySuper and pension) options performed well, returning 2.07% for super and 2.27% for pension, both above the median return for Australian super funds.1
There has also been some fluctuation in markets due to uncertainty around the trajectory of interest rates after stronger than expected inflation figures. Energy prices have moved higher and coupled with supply issues in Europe and Asia, some investors are questioning if the high inflation figures will really be a temporary blip, as most currently assume. If markets start to price in an inflationary cycle, there are likely to be significant changes to central banks’ bond buying programs and sooner-than-expected increases in interest rates. Pleasingly, we have not seen corporate profits impacted by these inflation figures.
Most Australian super funds’ Balanced options recorded negative returns in September, including Media Super. It’s important to remember that while short-term losses can occur, superannuation is a long-term investment, and over the medium and long-term, Media Super’s Balanced options are continuing to perform strongly.
Your investment returns to 30 September 2021
Our Balanced (MySuper) option recorded -0.44% in September, a much smaller loss than median return of -1.33%.1 For the financial year to 30 September the option returned 2.07%, solidly above the median return of 1.72%.1
The pension Balanced option recorded -0.49% in September, also a significantly smaller loss than the median return of -1.56%.1 For the financial year to 30 September the option returned 2.27%, also solidly above the median return of 1.83%.1
Over the medium and long-term, our Balanced options’ are performing strongly, with returns for the pension balanced option for three years and MySuper and pension options for seven and 10 years above the median. Over the last five years, Media Super’s Balanced options’ investment performance is in the first quartile1 of Australian super funds.
The Balanced options are well diversified across a number of asset classes, including Australian and international shares, credit, property, infrastructure, fixed interest, foreign currency and cash, as well as various alternative investments, such as our Fulcrum film and TV financing fund.
As COVID-19 vaccination rollouts continue, the world appears to be shifting away from lockdowns to home-recovery programs. Economic recoveries continue to be patchy, with some industries experiencing booms, while others struggle. This has triggered one of the biggest disconnections between financial markets and the underlying economies, as financial markets surge ahead. While the recovery in corporate earnings and household income continues, the potential exists for supportive monetary policy to be wound back with a corresponding impact on valuations.
With a diversified portfolio of assets, Media Super is relatively well positioned for the period ahead. Recognising that there will be ups and downs along the way, we have reinstated the Balanced option’s portfolio protection, a mechanism designed to reduce the impact when share markets fall.
We’re here to help
If you have any questions about your investment returns or your investment options, our team is here to help. Give our friendly Helpline team a call on 1800 640 886 or lodge an enquiry through your online account.
Investment returns are not guaranteed and past performance gives no indication of future returns. Investment returns are net of investment fees and taxes.
1 SuperRatings Fund Crediting Rate Survey, September 2021 – Balanced options (60-76) Index and Pension Balanced options (60-76).