In a nutshell: The fundamentals of how your super is invested

How super is invested?

Super is invested across a range of different types of assets, grouped into classes such as:

• Shares – where you own a share of a company and therefore a share in any profit or loss.

• Property – where you could earn money from rental income and/or rising property values

• Bonds – a bond is a loan, but the money is borrowed from investors to borrowers, such as companies or governments. Income comes from interest paid on the bond.

• Cash– money in a bank account that receives interest.

Risk and return – why do you need a mix of assets?

Different asset classes have different potential for delivering high returns. Whilst we all want high returns in our super, there’s a catch! With higher return potential, we also have to accept higher risks, especially in the short term.

• Higher risk means there’s a chance to make more money (a higher return), but there’s also a higher risk of losing money. Shares are an example of a higher risk asset, also known as a growth asset.

• Lower risk means maybe not making as much money (a lower return), but there’s a lower risk of losing money. Cash is an example of a lower risk asset, also known as a defensive asset.

• Intermediate risk means some assets exhibit characteristics of both growth and defensive assets, like property and infrastructure.

How does Rest invest your super?

Here at Rest, we have 15 different investment options to choose from. You can choose from Core Strategy, Structured Options and Member Tailored Options. Giving you more control over how your money is invested.

1. Structured Options – a pre-made approach
   Under this approach, Rest combines the asset classes for you in the right proportion to meet our members’ needs. We create a range of options with different mixes of assets to give you a choice of lower, medium or higher growth options to balance your need for growth with your level of risk tolerance.
    
2. Member Tailored Options – a DIY approach
   You can choose to build your own investment portfolio, picking different asset classes based on your individual risk and return objectives. At Rest, the Member-tailored Options allow you to choose from options built around each asset class, as well as allocating money to the Structured Options if you like. That way, you could do it all yourself or if you wanted more property in your super portfolio, you could choose the Core Strategy and allocate some money to the Property option as an example.