Monthly highlights

  • The Growth (Cbus MySuper) option returned 0.91% for the month of July and 19.11% for the 12 months ending 31 July 2021.
  • Australian and Global shares delivered returned of 1.11% and 0.71% (hedged) respectively for the month of July 2021.
  • The Reserve Bank of Australia left the cash rate unchanged at 0.10% in its meeting on 7 July. 

Super Investment Option Performance (crediting rate)

 

  Cash Savings Conservative Conservative Growth* Growth (Cbus MySuper) High Growth
1 month 0.02% 0.87% 0.83% 0.91% 1.21%
FYTD  0.02% 0.87% 0.83% 0.91% 1.21%
1 Year 0.14% 7.04% 12.63% 19.11% 25.67%
5 Years p.a. 1.09% 5.29% n/a 9.48% 11.58%
10 Years p.a. 1.80% 6.05% n/a 9.82% 11.40%
Funds managed ($m) 899.76 1,049.58 762.39 54,817.29 4,255.63

*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 0.02% 0.87% 0.83% 0.92% 1.21%
FYTD  0.02% 0.87% 0.83% 0.92% 1.21%
1 Year 0.15% 7.05% 12.65% 18.83% 25.75%
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) 9.99 18.63 162.13 155.84 24.62

*These options commenced on 1 July 2017. 

Fully Retired Option Performance (crediting rate)

 

  Cash Savings Conservative Conservative Growth* Growth High Growth
1 month 0.03% 0.99% 0.92% 1.03% 1.32%
FYTD  0.03% 0.99% 0.92% 1.03% 1.32%
1 Year 0.17% 7.54% 13.98% 20.83% 28.42%
5 Years p.a. 1.37% 5.94% 8.41% 10.54% 12.80%
10 Years p.a. 2.20% 6.86% n/a 10.98% 12.72%
Funds managed ($m) 79.25 597.79 1,783.30 1,218.98 140.95

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

Market overview

Global share markets have continued to grind higher over the past month, with developed countries’ share markets tracking above expectations. This reflects the fact that many of the major developed economies are now reaching high levels of vaccination and their economies are continuing to open and operate. As of early August, the percentage of the population having received at least one dose of a COVID-19 vaccine is around 70% in the UK, Canada, Spain, Italy, and France, and 60% in the US and Germany. Even though the Delta variant of the virus has caused a large rise in infections in many of these countries, the evidence so far has been that the number of people getting severely sick remains at low levels thanks to the impact of the vaccines. Thus, additional restrictions on activity have been minimal and the economic rebound has continued at a strong pace. This has translated into strong corporate earnings growth and share market gains in key developed economies, such as the US, UK and Eurozone.

The story is a little different for countries that haven’t yet achieved high rates of vaccination, most of which are emerging market economies such as South East Asian countries (although Australia is presently in this group). In these countries, surges in Delta infections have forced governments to impose tighter restrictions or outright lockdowns, which have obvious economic costs.

Despite the recent domestic outbreaks and lockdowns, the Reserve Bank of Australia (RBA) maintained its optimistic medium-term view of the economy at the August meeting, as experience to date has been that once virus outbreaks are contained, the economy bounces back quickly. Prior to the current outbreaks, the Australian economy had considerable momentum, with the unemployment rate having fallen below 5% for the first time in a decade.

The Australian corporate earnings season is well under way with about 50% of listed companies beating earnings expectations, although returns are slightly lower than the previous reporting season.

Meanwhile, markets around the world have also been focused on China as it deals with its own Delta outbreaks and slowing economic momentum. At the same time, the authorities have embarked on a number of regulatory actions that have surprised financial markets. Shares in many Chinese companies listed in the US, Hong Kong and mainland China have fallen sharply as investors grapple with increased uncertainty around the regulatory environment that many of China’s largest companies will be facing.

Beijing has already launched anti-monopoly investigations into some of the country's biggest technology firms and taken action against a wide range of other businesses. For instance, in April, technology giant Alibaba accepted a record $2.8bn (£2bn) fine after an investigation found that it had abused its dominant market position for years.

Beijing has also unveiled a massive overhaul of China's $120bn private tutoring sector, under which all institutions offering tuition on school curricula will be registered as non-profit organisations.

Meanwhile, China's banking and insurance watchdog stepped up its regulation of online insurance companies. The China Banking and Insurance Regulatory Commission ordered the firms to stop improper marketing and pricing or face "severe punishment."

The changes raise many questions surrounding the underlying motivations for the changes and potential for further regulatory action. However, the near-term economic impact is limited and policy changes are most likely linked to the long-term development agenda.

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 31/07/2021 Growth (Cbus MySuper)
Australian shares 22.81%
Global market shares 27.76%
Emerging market shares 6.42%
Private equity 2.51%
Alternative growth 1.79%
Infrastructure 10.65%
Property 10.08%
Mid-risk alternatives 6.06%
Fixed interest 5.89%
Cash 6.03%
Growth / Defensive allocation split 74.68% / 25.32%

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.