Currency play helps 2014/15 returns

REST has lauded the contribution of unhedged international equities to its 9.47 per cent return over the past year for its MySuper Super Core Strategy fund.

Damian Hill, chief executive officer of REST Industry Super, said international equities is the fund’s largest weighting and was the strongest performer over the past year.

“The depreciation of the Australian dollar boosted returns from unhedged international equities, and other asset classes – infrastructure, property, alternative investments and bonds – also contributed,” he said.

In a message to members, Hill said he expected short term volatility ahead and that the fund would remain vigilant to downside risk over this period.

The fund is preparing for this volatility by trimming its allocation to shares in favour of yield-based assets and absolute return investments, but also maintaining a bias to overseas shares relative to Australian shares and an above-benchmark foreign currency exposure.

A week ago AustralianSuper reported returns of 10.86 per cent for its MySuper fund after taxes and fees.

It similarly attributed its relative success to “reasonable” returns from US, European and Japanese equity markets boosted by the strength of foreign currencies against the Australian dollar.

It also cited the growing success of its diversification into unlisted property and infrastructure assets.

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Mercer Super expands into frontier market debt, builds out PE program

The $80 billion Mercer Super has delivered a fourth consecutive year of double-digit returns to most members of its SmartPath lifecycle product. Global equities did a lot of heavy lifting, but chief investment officer Graeme Miller tells Investment Magazine that the fund is now looking further afield for returns.

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