Monthly highlights

  • The Growth (MySuper) option returned -1.15% for the month of February and 8.04% for the 12 months ending 28 February 2022.
  • Australian and Global shares* delivered a return of 2.09% and -2.68% (hedged) respectively for the month of February 2022.
  • The Reserve Bank of Australia left the cash rate unchanged at 0.10% in its meeting on 1 February. 

*ASX 300 Accumulation Index and MSCI ACWI ex Aust Net Divs Custom Tax Hedged to AUD.

Super Investment Option Performance (crediting rate)

Pre-mixed options:

The Conservative Growth accumulation option commenced on 6 July 2017.   Until 14th February 2022, Cash was formually known as Cash Savings, and Growth (MySuper) was formually known as Growth (Cbus MySuper).

  High Growth Growth Plus

Growth

(MySuper)

Indexed

Diversified

Conservative

Growth

Conservative
1 month -1.47% n/a -1.15% n/a -0.90% -0.66%
FYTD  -0.12% -0.55% 0.44% -1.49% -0.03% -0.20%
1 Year 9.21% n/a 8.04% n/a 5.28% 3.34%
5 Years p.a. 10.07% n/a 8.34% n/a n/a 4.61%
10 Years p.a. 11.03% n/a 9.49% n/a n/a 5.57%
Funds managed ($m) 4,380.00 1.06     54,577.08 0.63 805.15 1,074.34

DIY options

The Growth Plus, Indexed Diversified, Overseas Shares, Australian Shares, Property and Diversified Fixed Interest options commenced on 14 February 2022 therefore crediting rate information for longer time periods are not applicable.

 

Overseas

Shares

Australian

Shares

Property

Diversified

Fixed Interest

Cash
1 month n/a n/a n/a n/a 0.02%
FYTD -3.58% -0.97% 0.37% 0.15% 0.14%
Funds managed ($m) 0.40 2.29 4.89 2.38 1,102.46

Transition to Retirement Option Performance (crediting rate)

Pre-mixed options:

The Conservative Growth option commenced on 1 July 2017.  Until 14th February 2022, Cash was formually known as Cash Savings.

  High Growth Growth Plus

Growth

(MySuper)

Indexed

Diversified

Conservative

Growth

Conservative
1 month -1.48% n/a -1.13% n/a -0.90% -0.65%
FYTD  -0.15% -1.53% 0.45% -1.49% -0.04% -0.18%
1 Year 9.20% n/a 7.99% n/a 5.29% 3.37%
5 Years p.a. n/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 n/a
Funds managed ($m) 21.30 0.01 145.22 0.01 139.56 15.14

DIY Options:

The Growth Plus, Indexed Diversified, Overseas Shares, Australian Shares, Property and Diversified Fixed Interest options commenced on 14 February 2022 therefore crediting rate information for longer time periods are not applicable.

 

Overseas

Shares

Australian

Shares

Property

Diversified

Fixed Interest

Cash
1 month n/a n/a n/a n/a 0.02%
FYTD -3.68% -1.04% 0.03% 0.15% 0.14%
Funds managed ($m) 0.01 0.01 0.01 0.01 8.77

Fully Retired Option Performance (crediting rate)

Pre-mixed options:

The Conservative Growth Income Stream option commenced on 1 December 2013.  Until 14th February 2022, Cash was formually known as Cash Savings.

  High Growth Growth Plus

Growth

(MySuper)

Indexed

Diversified

Conservative

Growth

Conservative
1 month -1.29% n/a -1.04% n/a -0.86% -0.65%
FYTD  0.20% -1.18% 0.60% -1.62% 0.08% -0.29%
1 Year 10.41% n/a 8.80% n/a 5.91% 3.32%
5 Years p.a. 11.22% n/a 9.31% n/a 7.42% 5.18%
10 Years p.a. 12.28% n/a 10.59% n/a n/a 6.28%
Funds managed ($m) 143.51 0.76 1,287.72 0.10 1,863.55 582.12

DIY options: 

The Growth Plus, Indexed Diversified, Overseas Shares, Australian Shares, Property and Diversified Fixed Interest options commenced on 14 February 2022 therefore crediting rate information for longer time periods are not applicable.

 
 

Overseas

Shares

Australian

Shares

Property

Diversified

Fixed Interest

Cash
1 month n/a n/a n/a n/a 0.02%
FYTD -4.01% -1.18% -0.74% 0.19% 0.17%
Funds managed ($m) 0.01 0.11 0.31 0.10 145.46

Market overview

Investment Environment Overview (current as at 21 March 2022)

February and March saw a significant pickup in market volatility as the Russian invasion of Ukraine reverberated around the World. As the conflict scaled up, Share Markets slumped. Between 9 February and 8 March, the US S&P500 index (which features 500 leading U.S. publicly traded companies) fell by 9.1% and the European Stoxx600 index (which features leading European publicly traded companies) fell by 12.3%. However, over the subsequent two weeks or so markets rebounded strongly and the loss since 9 February stands at 2.8% for the S&P500 and 3.8% for the Stoxx600.

Although Russia and Ukraine are only a small share of the global economy and equity market, both countries are major commodity producers, and it is through this channel that most of the World will feel the impact of the war. Russia accounts for 15% of global oil exports, 18% of wheat exports, and 13% of fertilizer exports, among others. Ukraine is a major grain producer, accounting for 13% of global corn exports, 12% of barley exports and 8% of wheat exports. Clearly, Ukrainian grain production is likely to be severely reduced this year. And Russia faces broad and expanding sanctions, including the US banning Russian energy imports.

As a result, there have been broad-based commodity price increases, especially for oil, natural gas and grains. This will exacerbate already-high inflation in most economies, adding to cost-of-living pressures and putting pressure on corporate margins.

The advance in commodity prices adds to the inflation challenge facing central banks. In the US, CPI inflation rose to 7.9% y-o-y in February. Even stripping out energy and food prices, ‘core’ inflation (the change in the costs of goods and services but does not include those from the food and energy sectors) is running at 6.4% y-o-y; well above the Federal Reserve’s 2% target. Responding to the overshoot in inflation – as well as continued strength in the labour market, where unemployment fell to 3.8% in February – the Federal Reserve lifted the target range (the rate at which the fed suggests commercial banks borrow and lend their excess reserves to each other overnight) for its policy interest rate by 0.25%, to 0.25%-0.50%, at the March meeting. That was the first interest rate increase in the world’s largest economy since the start of the pandemic (although other central banks in New Zealand, the UK and Canada, among others, had already begun to raise rates in H2 2021). Given the strong state of the economy, members of the Federal Reserve’s policy-setting committee forecast a fairly rapid tightening over the rest of the year, with the policy rate expected to reach 1.75%-2.00% by end-2022. With expectations for both inflation and interest rates rising, bond yields have also climbed sharply in recent weeks (which means lower bond prices, weighing on fixed interest returns).

A key question for financial markets is, how will the economy handle the anticipated tightening of monetary policy around the world? Fortunately, the starting position is a strong one, with growth rates remaining high. Households (and many businesses) having accumulated large cash savings over the course of the pandemic, which they can draw on to support activity. And the services sectors should benefit from continued reopening and a normalization in spending patterns.

There is an important medium-term question about how central banks bring inflation under control without creating too much economic damage. But over the next 12 months or so, the global economy should be able to handle the anticipated tightening in policy settings. That is a positive for financial markets. But with risks abounding, increased volatility could be here to stay for now.

Asset allocation

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

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

 

Actual allocation 28/02/2022 Growth (Cbus MySuper)
Australian shares 23.84%
Global shares 23.15%
Emerging market shares 6.48%
Private equity 2.04%
Alternative growth 1.01%
Infrastructure 11.87%
Property 12.09%
Global Credit 7.60%
Fixed interest 6.42%
Cash 5.49%
Growth / Defensive allocation split 72.30% / 27.70%

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 31 July 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.