Investment and market updates
Keep up to speed on economic movements that could impact your super investment.
Investment performance update
Hear from Chief Investment Officer Graeme Miller on the latest super returns.
-
View transcript
Hi, I’m Graeme Miller, Chief Investment Officer at TelstraSuper.
In this video, I’ll update you on the performance of TelstraSuper’s investment options in the final three months of 2023 and provide a summary of how your super performed for the full calendar year.
I’ll also talk about the outlook for 2024 and how our investment portfolios are currently positioned.
[DISPLAY QUARTERLY ACCUMULATION RETURN SLIDE ON SCREEN]
The chart on the screen shows the performance of TelstraSuper’s investment options for our accumulation members for the three months to 31 December 2023. You can see that it was a strong quarter of performance for all our diversified investment options.
The Growth investment option earned almost 4%, the Balanced and Moderate options earned 3.6% each, and the Conservative option earned 2.7%. Our new High Growth investment option, which was introduced at the start of October 2023 had a great first quarter of performance, delivering 4.7%.
These returns are net of all investment taxes and investment fees.
[DISPLAY QUARTERLY PENSION RETURN SLIDE ON SCREEN]
And here are the returns for RetireAccess pension members. You’ll see they’re similar to the returns for our accumulation members. The Lifestyle Growth Investment Option earned 4.1%, the Lifestyle Balanced option achieved 3.9%, the Lifestyle Moderate option earned 3.5% and the Lifestyle Conservative option earned 2.7%.
So, it was strong quarter overall. It started off with quite a weak month in October, but was followed by two very strong months of performance in November and December.
[DISPLAY ANNUAL RETURN SLIDE]
Let’s have a look now at the performance for the full 2023 calendar year:
This slide shows performance of all our investment options over the full year, for both Accumulation as well as RetireAccess members.
I’m sure you’ll be pleased to see these strong returns for the full year for most of our investment options. For example, if you’re accumulation member in Growth option, your super will have grown by 10.7% for the year. If you’re a RetireAccess member in the Lifestyle Balanced option, you will have earned 9.5% for the year.
Our strongest performing option for the year was the International Shares option, which was up by 17.5% for accumulation members and 19.1% for RetireAccess members. The Australian Shares option also performed well, delivering double digit returns.
In contrast, the Property investment option had negative performance in the 12 months. It was down by 6.3% for Accumulation members and 6.7% for RetireAccess members. In 2023, the value of commercial properties declined as interest rates rose, and we saw softening in demand for office properties, in particular. It’s not unusual to see cyclicality in the value of properties, and the weak performance over the last 12 months or so has been preceded by some periods of very strong returns. In fact, when we measure returns over a 10 year period, the Property investment option has delivered the highest returns of all our options.
The last twelve months have provided another example of the benefits of having a well-diversified investment portfolio, spread across several different asset classes, and invested in many different countries, sectors and industries. Although it was a weak year for property, it was strong year overall for shares, and we saw some pleasing performance from fixed interest investments in the final quarter of the year. Our infrastructure investments also had another solid year of performance.
I’ll now talk briefly about what 2024 may have in store. As is often the case, there is a range of different possibilities for how economies and investment markets may fare in 2024. The key things that we are monitoring are the following:
Firstly, we’re carefully watching what happens to inflation. If inflation continues to moderate, then we may not see any further interest rate rises in 2024, and interest rates may begin to decline. Many investors believe this will be the case, and this is the key reason why we saw such strong returns from share markets and fixed interest investments towards the end of last year. Declining inflation is likely to be positive for most investments, but if inflation ticks up again, this is likely to have a negative impact on asset prices.
We’re also keeping an eye out on economic growth, both in Australia as well as overseas. There is already some evidence that consumers are beginning to reduce their spending, as higher interest rates and other cost of living pressures begin to bite. If consumer spending declines, this will slow down economic growth.
The third thing we’re monitoring is the current conflicts in the Middle East and Ukraine. These conflicts have not had a major impact on investment markets so far, but if either of these escalate, this could lead to a downturn in investor sentiment. On the other hand, a resolution of these conflicts may result in positive returns.
And finally, towards the end of 2024, we’ll see a Presidential election in the United States - the world’s largest economy. At this early stage, it appears likely that Americans will have the same choice of candidates as in 2020. We’re expecting the result to be close, and there is a good chance that the outcome will be disputed, regardless of who wins, which may lead to economic instability.
Putting all of these possibilities together, we think it is prudent to keep our asset class portfolio somewhat cautiously positioned, though still closely aligned to our long term targets. We’re holding slightly less Australian shares than our long-term targets and a bit more fixed interest and foreign currency.
As always, our team of investment professionals will continue to manage our portfolios actively, remaining alert to both opportunities and risks in markets.
It’s a privilege to be entrusted with the management of your super savings. It’s a responsibility we take very seriously. We look forward to navigating another year on your behalf.
Please remember past performance is not a reliable indicator of future performance.
This presentation contains factual information and general advice only, including information about financial products. It has been prepared without taking into account your objectives, financial situation and needs. You should consider whether it is appropriate having regard to your personal circumstances before making any financial decisions. Before making any investment decision, you should obtain and read the relevant product disclosure statement which is available on the TelstraSuper’s Website or by calling 1300 033 166 between 8.30 am and 5.30 pm (AEST) Monday to Friday. You may wish to consult an adviser before you make any decisions relating to your financial affairs. To speak with an Adviser from TelstraSuper Financial Planning call 1300 033 166.
All returns displayed in this presentation are net of all applicable investment taxes and investment fees, but before the deduction of any applicable percentage-based administration fee, member fee or rebate.
Global Market Updates
Read what’s happening across Australian and global investment markets.
January 2024 Global Market Update
December 2023 Global Market Update
November 2023 Global Market Update
October 2023 Global Market Update
September 2023 Global Market Update