AvSuper News

Best Annual Investment Performance for Growth (MySuper)

AvSuper Growth (MySuper) option 2020-21 return is 20.6%

1 year net return ended 30 June 2021

(Soft close prices – official returns to be posted around 30 July 2021)

Dear Members,

I am very proud to announce that as at 30 June 2021 we have achieved the best annual investment return for members for the Growth (MySuper) Options, since AvSuper began over 30 years ago.  For now, we have used soft close numbers for the Growth (MySuper) Option to give members an idea of the final numbers. The official returns for all options will be posted around July 30.

This return has been buoyed by stellar market returns over the past 12 months, including big upticks in consumer discretionary, communication services, commodity prices and financials over the past 6 months. The All Ordinaries posted its best run in 34 years (26.4%). This is a massive recovery of 60% from the March 2020 lows when the effect of COVID-19 hit financial markets. Additionally, this boom was lifted by record levels of government and central bank spending, and even eclipsing the boom years post GFC.

AvSuper’s comparative performance against the existing published returns of some major superannuation funds MySuper products looks positive.

Graph showing AvSuper 2020-21 returns of 20.6% compared to the objective of 4.71% and exceeding some other funds

Over a year that has so much turbulence and change in markets AvSuper has always been conscious of the responsibility to preserve member benefits.

We have been steadily fine tuning our investments and strategy.  AvSuper can take advantage of our smaller size and therefore has been investing in like for like sized Investment Managers and strategies.  These strategy changes will be noted more thoroughly in our upcoming Annual report and after the Trustees have reviewed the full year financial results.

As always, if you have any questions about AvSuper or your super savings, please contact us on 1300 128 751, via AvChat or email us.

Michael

Michael Sykes
AvSuper CEO

 

Past performance is not necessarily an indicator of future performance and it is important to note that your super is invested with a long term focus. The investment earnings on your account balance may vary from above depending on when (if) you made any switches and contributions.

Legislation updates

Further to the fact sheets we provide after the 2020 and 2021 Federal Budgets, there have been a number of other very recent legislative changes that will impact on superannuation. 

We have outlined these changes on our Legislation updates page and summarise them below for you:

  • Your Future, Your Super
    includes Fund Stapling (to avoid inadvertent account duplication) and a comparison tool
  • recontributing COVID-19 early release withdrawals
  • bring forward arrangements extended to 65 and 66 year olds
  • removal of excess concessional contributions charge
  • increase concessional contributions cap

For further information on any of these measures, please contact our Member Advice Consultants.

Michael

Michael Sykes
CEO

Investment performance update at 8 June 2021

Welcome to our investment performance update as we head towards the end of financial year.

The following tables summarise our performance against each of the options’ investment objectives.

Accumulation returns to 30 April 2021

Income stream returns to 30 April 2021

The Growth (MySuper) Option moved into 2nd quartile position compared to other super funds during the March quarter. Performing at 18.9% on a one year basis to 30 April 2021, this option achieved well above its target objective of 4.7%.

For income streams, the Stable Growth Option achieved above median results and held its 2nd quartile position against other super funds. This option returned 12.0% on a one year basis to 30 April 2021, well above our target objective at 3.7%.

Driving AvSuper performance

Underlying portfolio manager changes in 2020 made a positive impact to performance thus far. This is part of our continuous improvement and best practice for member outcomes.  Further, AvSuper is about to undergo a full Investment review, with the results expected to be in our August update to members.

Stock-markets around the world have rebounded sharply after the initial Covid-19 lockdown and falls in March 2020. Accordingly, AvSuper anticipates giving its members a positive result for 30 June 2021, especially with the current trajectory of market movement.

Do you know about our Diversified Index Option?

AvSuper’s Diversified Index option was established in July 2019 following member requests for a low cost index option. Based on a 70% growth and 30% defensive composition, this option is intended to track the index of the major markets globally, the Australian stock-market, the Australian Bloomberg AusBond Composite Index and the Bank Bill index.

Our Diversified Index option now has a performance track record and has returned 16.4% for the rolling twelve months to 30 April 2021.

returns graph for the Diversified Index option to 30 April 2021

Diversified Index returns to 30 April 2021

It is designed for members who are seeking indexed market returns with low fees and can tolerate high levels of volatility in the short term.

At an investment cost of 0.06% pa, this option will closely match the index returns for Australian, global and fixed income markets, noting that the risk band is high due to the volatile nature of returns.

What else can you do?

You can keep your AvSuper savings strategy on track by

  • reviewing your investment mix – remember we have nine options to choose from and there is no fee to switch options. You can choose different options for your savings and future transactions to best suit your needs and circumstances
  • stay in touch with investment news – read our monthly commentary and fact sheets
  • talk to our friendly member service team about AvSuper and your investment options
  • book a time with our qualified financial planners to ensure your investments are working towards your financial goals.

Income stream reductions are extended

Many of our income stream members will be pleased to know that the 50% reduction in mandatory drawdowns has been extended for the 2021-22 financial year.

Income stream must withdraw a minimum amount of money each financial year by law. This amount is based on your age and your income stream balance. We tell you about your minimum annual drawdown amount each July.

Due to COVID-19, this minimum drawdown amount was halved for the 2019-20 and 2020-21 financial years. The Government recently approved an extension of this reduction so retirees can continue to preserve their income stream to minimise losses related to the pandemic.

We will contact our income stream members shortly about their 2021-22 drawdown arrangements. This will include information about how to change your drawdowns and making use of the reduction if you have not already done so. If you are currently using the reduction, we will continue that arrangement into the new financial year. 

Of course, if you have any questions about your drawdowns or would like some advice on structuring your income stream and drawdowns, please call our member services team or catch us on AvChat.

Michael

Michael Sykes
Chief Executive Officer

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