23 April 2025
Global markets have experienced higher volatility recently due to geopolitical developments. US trade policies have raised concerns about the negative impacts that tariffs may have on the prices of goods, company earnings and economic growth.
The return of market volatility highlights the benefits of diversification and active management – both of which are cornerstones of AustralianSuper’s long-term investment strategy.
Investment performance was mixed during the March quarter. While January delivered strong returns, a correction in February and March meant most AustralianSuper PreMixed investment options finished the quarter slightly lower, but all remain in positive territory for the financial year to 31 March 2025.
AustralianSuper’s Balanced option has delivered 4.92% for Super and 5.29% for Choice Income for the financial year to 31 March 2025.
The Balanced option for Super has also delivered 9.16% per annum over 5 years, 7.44% per annum over 10 years and 7.59% per annum over 20 years to 31 March 2025.1
AustralianSuper remains one of the top performing super funds over the long term, with the Balanced option ranking #2 over the last 15 and 20 years for investment performance.2
The returns for all PreMixed and DIY Mix investment options are shown below:
Super and TTR Income investment option performance as at 31 March 2025
| INVESTMENT OPTION | 3 Months | FYTD | 1 Year | 3 Years p.a. | 5 Years p.a. | 10 Years p.a. | 15 Years p.a. | 20 Years p.a. |
|---|---|---|---|---|---|---|---|---|
| PreMixed Options | ||||||||
| High Growth | -1.10% | 5.14% | 5.27% | 6.17% | 10.86% | 8.22% | 8.87% | 7.97% |
| Balanced | -0.52% | 4.92% | 5.17% | 5.24% | 9.16% | 7.44% | 8.14% | 7.59% |
| Socially Aware | -0.72% | 4.92% | 4.93% | 4.96% | 8.83% | 6.48% | 7.63% | 6.98% |
| Indexed Diversified | -0.95% | 5.95% | 6.11% | 6.97% | 9.60% | 6.80% | ||
| Conservative Balanced | -0.07% | 4.62% | 4.85% | 4.06% | 6.56% | 5.83% | 6.82% | |
| Stable | 0.48% | 4.26% | 4.53% | 3.10% | 4.26% | 4.46% | 5.45% | 5.51% |
| DIY Mix Options | ||||||||
| Australian Shares | -1.22% | 5.40% | 4.39% | 7.16% | 14.51% | 8.53% | 8.60% | 8.65% |
| International Shares | -2.62% | 7.68% | 7.12% | 10.77% | 12.54% | 10.41% | 11.02% | 8.46% |
| Diversified Fixed Interest | 1.40% | 2.98% | 3.20% | 1.24% | 0.85% | 1.96% | 4.00% | 4.26% |
| Cash | 1.00% | 3.19% | 4.22% | 3.30% | 2.05% | 1.97% | 2.47% | 3.16% |
AustralianSuper investment returns are based on crediting rates, which are returns less investment fees and costs, transaction costs, the percentage-based administration fee deducted from returns from 1 April 2020 to 2 September 2022 and taxes. Investment returns aren’t guaranteed. Past performance isn’t a reliable indicator of future returns. Returns from equivalent options of the ARF and STA super funds are used in calculating return for periods that begin before 1 July 2006.
For TTR Income accounts, the investment return is based on the crediting rate for super (accumulation) options. From 1 April 2020 to 2 September 2022 the crediting rate includes an administration fee that was deducted from investment returns for super (accumulation) accounts. TTR Income accounts will be adjusted to refund the administration fee deducted from investment returns.
Choice Income investment option performance as at 31 March 2025
| 3 Months | FYTD | 1 Year | 3 Years p.a. | 5 Years p.a. | 10 Years p.a. | 15 Years p.a. | |
|---|---|---|---|---|---|---|---|
| PreMixed Options | |||||||
| High Growth | -1.33% | 5.57% | 5.68% | 6.83% | 12.00% | 9.06% | 9.80% |
| Balanced | -0.73% | 5.29% | 5.48% | 5.73% | 10.01% | 8.11% | 8.99% |
| Socially Aware | -0.85% | 5.33% | 5.30% | 5.40% | 9.76% | 7.21% | 8.47% |
| Indexed Diversified | -1.10% | 6.59% | 6.69% | 7.73% | 10.72% | 7.65% | |
| Conservative Balanced | -0.17% | 5.06% | 5.26% | 4.51% | 7.33% | 6.54% | 7.61% |
| Stable | 0.45% | 4.69% | 4.94% | 3.47% | 4.77% | 5.00% | 6.14% |
| DIY Mix Options | |||||||
| Australian Shares | -1.39% | 5.99% | 4.93% | 8.09% | 16.21% | 9.57% | 9.81% |
| International Shares | -2.90% | 8.34% | 7.76% | 11.72% | 13.58% | 11.32% | 12.03% |
| Diversified Fixed Interest | 1.65% | 3.52% | 3.73% | 1.40% | 0.97% | 2.26% | 4.63% |
| Cash | 1.15% | 3.69% | 4.91% | 3.85% | 2.39% | 2.31% | 2.91% |
Choice Income investment returns are based on crediting rates, which are returns less investment fees and costs, transaction costs and taxes. Investment returns aren’t guaranteed. Past performance isn’t a reliable indicator of future returns
Market volatility returns
You’ve likely seen headlines about US tariffs and the impact they’re having on investment markets. The lack of clarity around these trade policies and their implementation has raised concerns about their longer-term impact on the global economy.
While US policies have been subject to change, Australia may continue to face direct tariffs on exports to the US. Additionally, we may face the indirect impacts of tariffs imposed on countries in Asia, which account for most of Australia’s exports.
The relationship between the US and China has been a particular point of focus, as the world’s two largest economies attempt to publicly negotiate a trade war.
Countries may enact various policy measures to support their economies in the coming months. Measures like increased government spending and interest rate cuts have the potential to mitigate the impacts of higher US tariffs.
However, markets will likely remain volatile in the short term as investors determine the degree to which these ongoing events will reduce global economic growth.
Our investment teams continue to monitor developments, assess potential impacts on markets and position the portfolio to deliver long-term performance for members.
Read more about market volatility hereWhat this has meant for your super
This uncertainty has weighed on listed share markets. Despite being the largest contributors to performance for the financial year-to-date, Australian and international shares detracted during the March quarter as stocks sold off.
However, our investments in unlisted assets – like private equity, credit and infrastructure – as well as fixed interest have contributed meaningfully during both the March quarter and financial year-to-date. The positive returns from these investments have acted as a ballast, cushioning the impact of the recent stock market correction.
Despite recent market volatility, the PreMixed options have highlighted the benefits of diversification and active management – both of which are cornerstones of AustralianSuper’s long-term investment strategy.
While volatility impacts investment returns day-to-day, history shows that staying invested in a diversified portfolio of assets can help grow members’ retirement balances over the long term.
Focusing on the long term
While it’s valuable to keep tabs on your super, super is less about short-term results and more about building your savings for the long term.
As Head of Asset Allocation, Alistair Barker, explains, “a long-term view shows substantial growth in value for members who stay invested in a diversified portfolio, like our Balanced option, through market ups and downs.”
AustralianSuper’s active management approach, long-term focus and investments in unlisted assets have delivered strong returns over the past 20 years. This is reflected in the chart below. Here we see the growth of $100,000 invested in the Balanced option over 20 years to 31 March 2025. Over this time, without any additional contributions, $100,000 has grown to $432,683 – despite market ups and downs.
Growth of $100,000 from 31 March 2005 to 31 March 2025 in the Balanced option
AustralianSuper investment returns are based on crediting rates, which are returns less investment fees and costs, transaction costs, the percentage-based administration fee deducted from returns from 1 April 2020 to 2 September 2022 and taxes. Returns don’t include all administration, insurance and other fees and costs that are deducted from account balances. Returns from equivalent investment options of the ARF and STA super funds are used for periods before 1 July 2006. Investment returns aren’t guaranteed. Past performance isn’t a reliable indicator of future returns.
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Our active management investment strategy
AustralianSuper’s investment team continues to adapt to changing market conditions – to manage risk for members’ super in the short term – while investing in attractive opportunities to grow members’ super in the long term.
Volatile markets often lead to the mispricing of assets. As an active manager, we’re always searching for new investment opportunities that can deliver attractive long-term returns. In fact, market downturns can often create buying opportunities for long-term investors.
Our global portfolio enables our team to access growth opportunities in Australia and abroad, while seeking to reduce the potential impacts of market volatility through diversification. In general, we intend to invest more to unlisted assets, like Private Equity and Infrastructure, when attractive opportunities present themselves. We may also buy more listed shares if equity markets fall further.
Liquidity is a key focus for the investment team during times of market volatility, as it enables us to take advantage of new investment opportunities when they reach attractive prices. The investment team performs daily liquidity monitoring, conducts stress tests and plans for stressed market conditions. These processes seek to ensure there is sufficient liquidity to meet the fund’s obligations, even during times of market stress.
Read about the benefits of active management here -
New Investment: M7 Real Estate
Earlier this year, AustralianSuper announced a new partnership with Oxford Properties Group. AustralianSuper acquired a 50% stake in their c.$1.4 billion European industrial and logistics portfolio, as well as in M7 Real Estate, a market leading European investment and asset management business that was acquired by Oxford in 2021.
The joint venture aims to build a significant industrial and logistics venture across Europe, which will be managed by M7. As the investment and asset manager, M7 will be responsible for sourcing and executing on new opportunities for the strategy. This new joint venture aligns well with AustralianSuper's strategy of investing in real asset platforms with operational expertise which can scale to meet our investment appetite.
The existing portfolio comprises c.730,000 sqm of high-quality urban logistics and distribution warehouses across 76 assets. The properties are located in 19 of the most strategic urban distribution hubs in the UK, Denmark, France, Germany, the Netherlands and Spain. With a diversified base of more than 200 tenants, the portfolio is well positioned to capitalise on increased occupier demand and rental growth throughout western Europe.
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Investment option changes
We previously communicated that we expect to update members on changes to the Socially Aware investment option in April 2025. However, due to current market volatility, those changes have been deferred.
Learn more about your advice options
Members have access to a range of advice, and you can learn more here.
References
1. Returns from equivalent investment options of the ARF and STA super funds are used for periods before 1 July 2006.
2. AustralianSuper Balanced investment option compared to the SuperRatings Fund Crediting Rate Survey – SR50 Balanced (60-76) to 31 March 2025. Investment returns aren’t guaranteed. Past performance isn’t a reliable indicator of future returns. Returns from equivalent investment options of the ARF and STA super funds are used for periods before 1 July 2006.
This may include general financial advice which doesn’t take into account your personal objectives, financial situation or needs. Before making a decision consider if the information is right for you and read the relevant Product Disclosure Statement, available at australiansuper.com/PDS or by calling 1300 300 273. A Target Market Determination (TMD) is a document that outlines the target market a product has been designed for. Find the TMDs at australiansuper.com/TMD.
AustralianSuper Pty Ltd ABN 94 006 457 987, AFSL 233788, Trustee of AustralianSuper ABN 65 714 394 898.
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