Monthly highlights

  • The Growth (MySuper) option returned -2.83% for the month of June and -3.77% for the 12 months ending 30 June 2022.
  • Australian and Global shares* delivered a return of -8.97% and -7.68% (hedged) respectively for the month of June 2022.
  • The Reserve Bank of Australia increased the cash rate to 0.85% in its June meeting. 

*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 formally 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 -4.18% -3.54% -2.83% -4.95% -2.25% -1.44%
FYTD  -5.85% -5.76% -3.77% -8.18% -4.17% -3.82%
1 Year -5.85% n/a -3.77% n/a -4.17% -3.82%
5 Years p.a. 7.74% n/a 6.55% n/a n/a 3.38%
10 Years p.a. 10.47% n/a 8.96% n/a n/a 5.01%
Funds managed ($m) 4,357.21 433.43     56,675.25 12.46 830.60 1,223.44

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 -3.35% -8.11% -2.19% -1.55% 0.06%
FYTD -12.52% -7.85% -1.38% -5.25% 0.21%
Funds managed ($m) 30.84 134.93 45.16 42.40 1,603.90

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 formally known as Cash Savings.
 

  High Growth Growth Plus Growth

Indexed

Diversified

Conservative

Growth

Conservative
1 month -4.19% -3.53% -2.86% -4.90% -2.26% -1.44%
FYTD  -5.90% -6.60% -3.81% -8.08% -4.18% -3.80%
1 Year -5.90% n/a -3.81% n/a -4.18% -3.80%
5 Years p.a. 7.84% n/a 6.64% n/a 4.95% 3.43%
10 Years p.a. n/a n/a n/a n/a n/a n/a
Funds managed ($m) 19.48 3.72 169.24 0.02 134.87 17.64

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 -3.35% -8.07% -2.12% -1.55% 0.06%
FYTD -12.68% -7.75% -1.48% -5.25% 0.21%
Funds managed ($m) 0.51 2.08 0.37 0.82 12.68

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 formally known as Cash Savings.
 

  High Growth Growth Plus Growth

Indexed

Diversified

Conservative

Growth

Conservative
1 month -4.77% -4.01% -3.25% -5.36% -2.57% -1.67%
FYTD  -6.09% -6.60% -4.05% -8.90% -4.39% -4.38%
1 Year -6.09% n/a -4.05% n/a -4.39% -4.38%
5 Years p.a. 8.66% n/a 7.36% n/a 5.72% 3.81%
10 Years p.a. 11.72% n/a 10.03% n/a n/a 5.67%
Funds managed ($m) 136.14 25.65 1,549.10 1.03 1,844.62 717.76

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 -3.69% -8.69% -2.52% -1.83% 0.07%
FYTD -13.87% -8.40% -2.81% -6.14% 0.25%
Funds managed ($m) 2.65 13.78 4.61 11.94 266.80

Market overview

Investment Environment Overview (current as at 21 July 2022)

The June quarter was a challenging one for markets, with the MSCI All Country World Index falling by 16.1% over the quarter. At the same time, bond yields rose sharply; the US 10-year yield climbed from 2.33% at the start of the quarter, to 2.97% at the end (after having peaked around 3.5% in mid-June). The ramp up in yields meant that bond prices fell, so the quarter saw losses for both bond and equity investors.

The root cause of the turmoil in markets was the continued acceleration in inflation, and the increasingly aggressive response of central banks via higher interest rates. In almost every major economy (with the notable exception of China, where the covid-zero strategy and associated lockdowns have weighed on the economy), inflation has risen above expectations in recent months – and far beyond central bank targets. The US has led the way, with CPI inflation hitting 9.1% y-o-y in June, the highest since 1981.

High inflation has resulted from strong consumer demand, supply chain disruptions, higher commodity prices (exacerbated by the war in Ukraine and sanctions on Russia), and tight labour markets. In response, central banks are raising interest rates quickly in an effort to slow down the overheating economy. Starting with rates close to zero, between March and June the US Federal Reserve increased its policy rate by 1.25%, and the Reserve Bank of Australia lifted its cash rate by the same amount between May and July. Market expectations are that both central banks will have increased rates by around 3.0% in total by the end of 2022.

The pace of this tightening in monetary policy was unexpected as recently as six months ago (when, by comparison, markets were pricing in policy rates of around 1% by the end of 2022 in both the US and Australia). The sudden and ongoing reassessment of the path of monetary policy has cascaded through financial markets, driving the large moves in bond and equity markets described above.

 

 

Asset allocation

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

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

 

Actual allocation 30/06/2022 Growth (MySuper)
Australian shares 22.33%
Global shares 23.87%
Emerging market shares 3.03%
Private equity 2.16%
Alternative growth 1.33%
Infrastructure 13.64%
Property 13.11%
Global Credit 7.28%
Fixed interest 6.97%
Cash 6.28%
Growth / Defensive allocation split 69.74% / 30.26%
   

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 (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.