I read with interest David Rowley’s column on 26 October entitled “Selling Lifecycle”. David referred to me as an advocate of lifecycle investing for default accumulation funds, using the terms “evangelical” and “faith”. I actually fully support the conclusion of David’s column but would take a bit of exception to those two terms.

They have a religious tone which could imply ideology or lack of evidence based thinking. To be clear we are not saying that all funds in all cases should use lifecycle investing models for their defaults. That is a matter for trustees. What we do say is where members have different assets and different liabilities the likelihood is they will be best served by different strategies.

From the viewpoint of an investment professional, lifecycle structures (and it is vitally important to note that QSuper uses both age and account balance to differentiate) give an informed professional more dimensions to actually apply investment judgement and skill to the challenge of turning 40± years of contributions into 25± years of potential drawdowns. We think that members’ risks change over that 70 year time frame. You don’t have to be evangelical or faith based to want to apply some investment skill to manage that risk for default members.

May the debate continue, coolly and openly as David suggests it should.

Brad Holzberger, chief investment officer, QSuper


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