Investment Strategy
In making decisions about investment strategy and management, the Trustee considers the overall circumstances of the Fund and any applicable legislative requirements.
The Fund's investments are managed in a manner to ensure sufficient liquidity to meet expected cash flow requirements. The Fund's assets are directed into externally managed investment products or portfolios with professional investment managers.
The Trustee uses the services of an asset consultant JANA Investment Advisers Pty Ltd, to provide advice in relation to appropriate asset allocation and selection and management of professional investment managers. The managers will have responsibility for the investment of the assets within specified limits. Each manager will be expected to display the skill and expertise of a professional investment manager with investment objectives compatible with that of the Fund.
Investment managers are permitted to use futures, options and other derivative instruments to assist with the effective management of the Fund's assets. However, these instruments may not be used to gear the portfolio. The Trustee expects that, over the long term, the use of these instruments will enhance the returns of the Fund's assets. Over shorter periods, the effect on investment returns is expected to vary from year to year.
Labour standards, or environmental, social and ethical considerations are not taken into account in selecting, retaining or realising the investment of the Fund. The Trustee will specify and continually monitor the minimum and maximum ranges of investments in Cash, Fixed interest, Australian Equities, International Equities, Property, Growth Alternatives and Defensive Alternatives.
Investment Objectives
| Investment Option |
Investment Objectives |
| Balanced |
To achieve high returns over the longer term, but with low to moderate risk. The objective is for earnings to exceed inflation by at least 3% averaged over rolling 7 year periods. |
| Capital Stable |
To achieve attractive but stable returns on a consistent basis with low volatility. The objective is for earnings to exceed inflation by at least 2% averaged over rolling 5 year periods. |
| Super Growth |
To achieve high returns over the longer term. The objective is for earnings to exceed inflation by at least 5% averaged over rolling 7 year periods. |
| Australian Equities |
To achieve a return, before tax and fees that exceeds the S&P/ASX300 Accumulation Index over rolling 3 year periods. |
| International Equities |
To achieve a return, before tax and fees that exceeds the 50% MSCI World ex-Australia Index and 50% MSCI World ex-Australia Index Hedged over rolling 3 year periods. |
| Property |
To achieve a return before tax and fees that exceeds the Mercer Australian Unlisted Property Index over rolling 3 year periods. |
| Fixed Interest |
To achieve a return, before tax and fees that exceeds the 50% UBS Composite Bond Index (total) and 50% Citigroup G5 Bond Index (hedged) over rolling 3 year periods. |
| Cash |
To achieve consistent stable returns with low volatility. Earnings should exceed inflation over rolling annual periods. |
| Bank Cash |
To achieve stable returns while providing increased capital protection. Earnings should match the RBA bank index over time. This option will typically provide a lower return than the Fund's cash investment option.
|
Investment Managers
The Trustee of AustSafe Super has appointed JANA Investment Advisers Pty Ltd to advise on investment managers and oversee their performance. The table outlines the asset classes which AustSafe Super is invested in and the investment managers appointed by the Trustee. The managers listed below are current as at 31 March 2012.
| Aberdeen Asset Management |
International Equities, Defensive Alternatives, Cash |
| AMP Capital Investors |
Growth Alternatives, Property, Cash |
| Various Australian Deposit Institutions (ADIs) |
Cash |
| Bentham |
Fixed Interest |
| Delaware Investment Advisors |
International Equities |
| HarbourVest Partners LLC |
Growth Alternatives |
| Hastings |
Growth Alternatives |
| ING Investment Management Limited |
Growth Alternatives |
| Integrity Investment Management |
Australian Equities |
| IronBridge Capital Management |
International Equities |
| LaSalle Investment Management |
Growth Alternatives |
| Marathon |
International Equities |
| Members Equity Bank |
Fixed Interest |
| The Private Capital Group |
Growth Alternatives |
| Northward Capital |
Australian Equities |
| Orbis Investment Management Limited |
Australian Equities |
| Pan Agora Asset Management |
International Equities |
| Paradice Investment Management |
Australian Equities |
| Perennial Investment Partners |
Fixed Interest |
| PIMCO |
Fixed Interest |
| Platinum Investment Management Limited |
International Equities |
| T Rowe Price |
International Equities |
| Trinity |
Property |
| Wilshire Global Advisors |
Growth Alternatives |
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Interim Earning Rates and Reserving
Interim earning rates are determined weekly and are based on the weekly movement in asset values for each investment option adjusted for tax, investment management and other costs.
The weekly earning rate is determined in arrears, typically on a Thursday, i.e. earning rate declared on Thursday relates to transactions applied to member’s accounts for the previous Saturday through to Friday. The interim earning rate is determined quarterly in arrears, i.e. the interim earning rate declared on 1st July relates to earnings from the Fund’s operational bank account for the period 1 April to 30 June.
If you exit the Fund during the financial year, earnings will be applied to your account for the period you were a member of the Fund. Earnings are applied using the earning rate for each complete week and an interim earning rate for the period from the last earning rate to the day of exit. Earning rates are based as closely as possible on the actual returns achieved by each investment option for each week. The interim earning rate is based on the interest earned on the Fund’s operational bank account, adjusted for tax and other costs. Earning rates, interim earning rates and investment performance updates are regularly posted on the website. Alternatively, you can contact AustSafe Super on 1300 131 293 to see how the investment options are performing.
If you switch Member Investment Choice options, the earning rates for each complete week will be used in the calculation of your balance. Earnings will be calculated and will be capitalised in your account as at 30 June each year or upon exit from the Fund.
The actual earning rate for each of the investment options may not always be the same as the final investment earnings of the Fund, due to the effect of Fund expenses, tax and the Fund’s Reserving Policy.
As a general rule the Fund will look to allocate the total earnings of each of the member investment choice options.
It is important to note that investment earnings can be positive as well as negative and will fluctuate in line with the earnings on the underlying assets. Where the earnings are negative, a negative earning rate will be applied to your account.
The Trustee will maintain reserves in accordance with the Fund’s Trust Deed and its Reserving Policy.
The Fund’s reserves may be split for management and control purposes into separate sub accounts. The average level of reserves will be maintained at a level of 0% to 3% with an upper limit of 5% of member balances.
If you claim a partial withdrawal from the Fund during the year, the earnings will not be applied until the next 30 June or upon full exit from the Fund. |