Monthly highlights

  • The Growth (Cbus MySuper) option returned 3.44% for the month of April and -0.81% for the 12 months ending 30 April 2020.
  • Australian and Global share markets rebounded in April by 9.02% and 9.80% respectively over the month following a slow down in the rate of new  COVID-19  cases. 
  • The Reserve Bank of Australia left the cash rate unchanged at 0.25% in its meeting on 5 May.

*This estimate is based on inflation data for the 10 years to 31 March 2020 as inflation data is only available quarterly. It is based on a weighted average of the investment performance objective over the past 10 years.

**SuperRatings is a ratings agency that collects information from superannuation funds to enable performance comparisons. The SR 50 Balanced Survey includes investment options that are broadly similar to the Growth (Cbus MySuper) option, as these funds are all diversified with an allocation to growth assets of between 60% and 76%. SuperRatings data is for April 2020 and was reported on 20 May 2020.

 

 

Growth (Cbus MySuper) investment objective

From February 2020, a return objective of at least 3.25% p.a. above the rate of inflation, after investment fees and tax over a 10 year period, with a likelihood of a negative annual return being 3 to 4 in every 20 years.

 

Over the past 10 years, the Growth (Cbus MySuper) option has outperformed its investment objective and outperformed the SuperRatings SR50 Balanced median.

Super Investment Option Performance (crediting rate)

 

  Cash Savings Conservative Conservative Growth* Growth (Cbus MySuper) High Growth
1 month 0.04% 1.39% 2.55% 3.44% 5.62%
FYTD 0.71% 1.16% -0.62% -2.73% -4.38%
1 year 0.95% 3.19% 1.40% -0.81% -2.62%
5 years p.a. 1.51% 4.63% n/a 6.23% 6.56%
10 years p.a. 2.30% 5.84% n/a 7.90% 8.28%
Funds managed ($m) 2,139.95 1,117.71 411.22 42,526.92 2,411.08

*The Conservative Growth accumulation option commenced on 6 July 2017.

Transition to Retirement Option Performance (crediting rate)

 

  Cash Savings* Conservative* Conservative Growth* Growth*
High Growth*
1 month
0.04% 1.39% 2.57% 3.64% 5.62%
FYTD 0.75% 1.21% -0.57% -2.49% -4.33%
1 year
1.00% 3.25% 1.47% -0.44% -2.55%
5 years p.a.
n/a n/a n/a n/a n/a
10 years p.a.
n/a n/a n/a n/a n/a
Funds managed ($m) 30.11 28.89 171.20 146.97 22.04

*These options commenced on 1 July 2017. 

Fully Retired Option Performance (crediting rate)

 

  Cash Savings Conservative Conservative Growth* Growth High Growth
1 month 0.04% 1.60% 2.84% 4.17% 6.46%
FYTD 0.89% 1.31% -0.38% -3.00% -5.35%
1 year 1.20% 3.55% 2.01% -0.77% -3.33%
5 year p.a 1.89% 5.28% 6.43% 7.06% 7.25%
10 year p.a 2.78% 6.58% n/a 8.83% 9.18%
Funds managed ($m) 316.98 553.21 1,194.79 838.79 68.65

**The Conservative Growth Income Stream option commenced on 1 December 2013.

 

Market overview

Global share markets rebounded in April as the rate of new cases of COVID-19 appeared to be slowing down, showing promise that the government-imposed trade and travel restrictions were effective in slowing the spread of the virus. The S&P 500 index in the US recovered most of the losses experienced in March, ending April up 12.68%. Share markets in Europe only managed to recoup some of the ground lost in March with the DAX in Germany gaining 9.32%, the UK’s FTSE 100 4.04%, and the CAC 40 in France up 4.00% over the month.

Closer to home, the Australian share market also recovered strongly in April with all sectors providing positive returns after falling the month prior. The two sectors that delinked the most in March rebounded strongly this month with Energy and Technology shares gaining 25.21% and 21.84% respectively. Consumer Discretionary, Materials, and Industrials all saw returns of more than 10% with returns of 16.44%, 14.37%, and 12.82% respectively. Only two sectors in the Australian share market had returns of less than 3% with Financials rising 2.89% and Consumer Staples up 2.59%.

Australian and global bonds provided returns of -0.19% and 0.30% respectively as investors moved away from these more defensive assets as investors started to get more certainty around the likely economic impact of COVID-19.

The Australian dollar gained ground against the US dollar over the month, going from $0.620 in March to $0.631 by the end of April.

Sources: FactSet, Frontier Advisors, Citigroup and JP Morgan. The investment market returns represented above are not Cbus asset class returns. They are returns for each market as measured by standard market indices. More information on these market indices can be found in the Glossary. For unhedged international shares and market shares, when the Australian dollar falls against currencies in major share markets, and there is no currency hedging, international market returns in Australian dollar terms are higher.

 

Asset allocation

The Strategic Asset Allocations for all investment options can be found on the following pages:

Super Options

Transition to Retirement Options

Fully Retired Options

The Actual Allocation for the Growth (Cbus MySuper) option is shown below.

 

Actual allocation 30/4/2020 Growth (Cbus MySuper)
Australian shares 21.64%
Global shares 21.81%
Emerging market shares 5.25%
Private equity 3.05%
Alternative growth 0.70%
Infrastructure 11.76%
Property 12.18%
Mid-risk alternatives 3.76%
Fixed interest 8.66%
Cash 11.18%
Growth / Defensive allocation split 66.31% / 33.69%  

Note: Growth assets include Australian Shares, International Shares, Private Equity, Alternative Growth, 50% of Infrastructure, 50% of Property and 50% of Mid-Risk Alternatives. Defensive assets include Cash, Fixed Interest, 50% of Infrastructure, 50% of Property and 50% of Mid-Risk Alternatives.

 

 

Figures are subject to rounding. Actual asset allocation is current as at 30 April 2020. Asset classes are the building blocks of our investment options. We allocate different proportions to each asset class with the aim of meeting each option’s investment risk and return objective. By investing across a range of asset types, the risk of loss is reduced through diversification. 

For more information see asset classes.

We periodically review our investment strategy and believe that the Growth (Cbus MySuper) option is well positioned for growth over the medium to long term, while maintaining some defensive exposure. Cbus’ investment options, with the exception of the Cash Savings option, are broadly diversified across asset classes.

 

Glossary

Investment type Market index

Australian shares

S&P ASX 300 Accumulation Index

Global shares – currency hedged

MSCI All Countries World Ex-Australia Index (Hedged, $A)

Global shares – currency unhedged

MSCI All Countries World Ex-Australia ($A)

Emerging markets – currency unhedged

MSCI Emerging Markets ($A)

Australian unlisted property

MSCI/IPD Australian Property Pooled Index

Australian bonds

Bloomberg AusBond Composite Bond Index

Global bonds

Citi World Government Bond Index (Hedged, $A)

Australian cash

Bloomberg AusBond Bank Bill Index

Disclosure

Past performance is not a reliable indicator of future performance. All Cbus performance and return figures disclosed in this investment update are based on the crediting rate, which is the return minus investment fees, the taxes, and until 31 January 2020, the percentage-based administration fee. Excludes fees and costs that are deducted directly from members’ accounts.

The information is about Cbus. It doesn’t take into account your specific needs, so you should look to your own financial position, objectives and requirements before making any financial decisions. Read the Cbus Product Disclosure Statement to decide whether Cbus is right for you, or call 1300 361 784 for a copy.