Investment update September 2020

Rest continues to deliver positive returns

Despite the market impact from the COVID-19 pandemic, Rest continued to deliver positive returns for members this quarter. Gains were largely driven from allocations to overseas shares, unlisted property and infrastructure assets. For super members, Rest’s default fund Core Strategy delivered returns of +2.69% for the quarter. For Pension members, the default fund Balanced option also ended September higher, with gains of +2.49% over the same time period.

Core Strategy option to 30 September 2020
3 months (%) 1 Year (%) 10 Years (%pa)
2.69 0.01 7.58
Balanced option (Rest Pension) to 30 September 2020
3 months (%) 1 Year (%) 10 Years (%pa)
2.49 0.74 7.26

Returns are net of investment fees and tax, except Pension which is untaxed. 3 month returns are not annualised returns. Returns for the 10 year period are annualised returns. Past performance is not an indication of future performance. For more investment information including the latest investment returns, click here.

Market shares

Australian shares finish flat for the quarter

Overall, the September quarter was a difficult one for the Australian economy. Australia officially entered into its first recession in almost 30 years, despite record low interest rates and massive government stimulus. Nevertheless, with encouraging signs the worst could be over and progress on the COVID-19 vaccine front, Australia’s S&P/ASX 300 sharemarket index ended the September quarter basically flat at -0.1%.

Looking ahead to the future

In the short-term, there’s still a lot of uncertainty in markets because of factors like the US Presidential election and ongoing trade tensions between the US and China. In the current low interest rate environment, we continue to see the benefits of diversification through unlisted assets, like infrastructure, property and private equity.

We also believe that our active management approach will allow us to take advantage of opportunities that come up, adding value over the long-term. It’s this approach that has served us well in the past with Rest’s Core Strategy returning +7.58% per annum over the 10 years to end September. This is well above its investment objective of CPI + 3% per year over the long-term, and also ahead of SuperRatings’ median fund return of 7.14% per annum over 10 years*.

Rest super performance to 30 September 2020*

Investment Option 3 months (%) 1 Year (%) 10 Years (% pa)
Core Strategy 2.69 0.01 7.58
Structured      
Balanced 2.50 0.28 6.49
Balanced - Indexed 3.07 1.05 N/A
Capital Stable 1.79 0.48 5.32
Diversified 3.09 0.16 7.91
High Growth 3.63 -0.18 8.78
Tailored      
Basic Cash 0.02 0.45 2.10
Cash 0.23 1.12 2.47
Bonds 0.74 1.34 4.42
Shares 4.09 -1.53 9.78
Property 0.51 -0.92 7.49
Australian Shares 1.53 -8.12 8.03
Australian Shares - Indexed 1.87 -6.87 N/A
Overseas Shares 5.46 1.00 10.36
Overseas Shares - Indexed 4.74 4.18 N/A

Rest pension performance to 30 September 2020*

Investment Option 3 months (%) 1 Year (%) 10 Years (% pa)
Core Strategy 3.00 0.98 8.40
Structured      
Balanced 2.49 0.74 7.26
Balanced - Indexed 3.67 1.28 N/A
Capital Stable 1.70 0.74 6.03
Diversified 3.30 0.72 8.79
Tailored      
High Growth 4.02 0.59 9.70
Cash 0.27 1.33 2.96
Basic Cash 0.02 0.55 2.47
Bonds 0.86 1.67 5.14
Shares 4.70 -0.68 10.67
Property 0.60 -0.84 8.35
Australian Shares 1.75 -5.25 9.23
Australian Shares - Indexed 2.56 -7.43 N/A
Overseas Shares 5.96 1.39 11.42
Overseas Shares - Indexed 5.38 4.65 N/A

* Returns are net of investment fees and tax, except Pension which is untaxed. 3 month returns are not annualised returns. Returns for the 10 year period are annualised returns.

* SuperRatings Fund Crediting Rate Survey - SR50 Balanced (60-76) Index, September 2020.Rest’s Core Strategy return and 10 year median return for the SR50 Balanced (60-76) Index to 30 September 2020 have been used. Returns are net of investment fees, tax and implicit asset-based administration fee. Explicit fees such as fixed dollar administration fees, exit fees, contribution fees and switching fees are excluded. Past performance is not an indication of future performance.