March 2024 quarterly investment update
PERFORMANCE
Our MySuper Balanced option, where a majority of members have their investments, delivered returns of 4.1% for the quarter and 8.0% for the financial year to date, as of 31 March 2024. The Balanced Pension option, too, demonstrated strong performance, returning 4.1% for the quarter and 8.4% for the financial year to date.
Our long-term returns remain strong with the Balanced (MySuper) option delivering an average return of 7.8% per year over the past 10 years for super members, and 8.4% per year for Pension members. These results are well ahead of the industry median and rank CareSuper amongst the top performers.*
Suzanne Branton, CareSuper's Chief Investment Officer, remarked, ‘We're delighted to achieve robust performance for our members. As the economic outlook improves, we stand poised to capitalise on upcoming investment opportunities. Our portfolio is strategically designed to deliver growth while also mitigating risks associated with potential market downturns.’
PERFORMANCE AS AT 31 MARCH 2024
| 3 months | 1 year | 10 years (p.a.) | |
| Balanced (MySuper) | 4.1% | 10.1% | 7.8% |
| Pension Balanced | 4.1% | 10.2% | 8.4% |
Returns are net of investment fees and tax, except for the Pension returns which are untaxed.
View our full investment returns for all options.
THE KEY DRIVERS BEHIND OUR RETURNS
The robust performance this quarter was mainly due to gains in equity markets, particularly overseas shares which rallied on the more optimistic global outlook driven by expectations of rate cuts later in the year. Factors such as strong economic growth, corporate earnings surpassing expectations, and investor interest in the technology sector driven by advancements in artificial intelligence, have boosted global share markets.
The Australian share market also experienced a robust quarter, especially in the resources and banking sectors, mitigating losses from the materials sector.
Fixed interest markets delivered positive returns for the quarter and the year. Meanwhile, the market is still adjusting to the earlier increases in interest rates and therefore the unlisted property ended the March quarter and the year with negative returns as valuations have fallen.
The Reserve Bank of Australia (RBA) has maintained its 4.35% interest rate, following similar decisions by major central banks like the US Federal Reserve. Despite this stability, early 2024 has seen higher-than-expected inflation, contrasting with last year’s downward trend.
WHAT WE CAN EXPECT GOING FORWARD
As we look ahead, inflation appears to be stabilising, and the global economy is seeing modest growth. Central banks are considering reducing interest rates, which requires a careful balance. Cutting rates too early could risk inflation getting out of control, while delaying rate cuts could affect consumers and slow economic growth.
Additionally, there are other risks to financial stability to consider. Issues in China's property market could have repercussions due to trade connections, and challenges in the global commercial property market could strain Australian borrowers. With the anticipation of monetary policy easing and meeting inflation targets, markets are especially sensitive to unforeseen events such as sudden inflation increases or major global events.
Rest assured that your retirement savings are in safe hands with CareSuper. We actively monitor the evolving investment outlook including; central bank actions, key economic trends, and global events to understand the changing economic landscape. Our active management approach ensures members' investments are well-positioned to weather market ups and downs and achieve growth over time.
*SuperRatings Fund Crediting Rate Survey – SR50 Balanced (60-76) Index, March 2024.