Recent market volatility and your super

Monday, 24 December 2018

Weaker global shares markets have made headlines in recent weeks, as worsening global trade tensions, Brexit concerns and higher US interest rates drove share prices down.

This downward movement follows an extended period during 2018 where global markets enjoyed strong gains.

Focus on the long term

At Rest, we encourage members to focus on long-term returns rather than short-term volatility. It’s important to remember that super is a long-term investment to provide savings for your retirement. Market volatility is a normal part of the investment cycle.

Fluctuations in the value of your investments and negative investment news can be unnerving. However, reacting to short-term market movements may work against your investment goals.

Having a long-term investment horizon softens the impact of these short-term market fluctuations. Rest reviews and adjusts our investment portfolios to manage risks as market conditions change, and to take advantage of opportunities as they arise.

We firmly believe that regardless of the behaviour of markets, investing is inherently about managing uncertainty and risk, and we continue to manage that downside risk with the aim of meeting our long-term investment objectives.

For example, while global economic momentum has been strong during 2018, our view has been that markets were susceptible to volatility as many markets traded above their long-term average valuations. For this reason, Rest kept a relatively defensive position in place.

Competitive long-term performance

The competitive long-term investment performance of our Core Strategy has given our members a return of 8.53% per annum over 10 years and 7.79% per annum over 20 years to 30 November 2018, placing Rest in the top three performers compared to similar options of other super funds surveyed over the same period*. Keep in mind that past performance is not an indicator of future performance.

We encourage all members to review their investment options every now and then to make sure they are still right for your investment goals.

Advice when you need it^#

Rest Advice is all about helping you make good decisions with your super and money. You can use our online advice tool to check your investment risk profile and get advice on which option is right for you. To learn more, or to book phone advice, go to rest.com.au/tools-advice/advice.