CSC investment performance for 2016-17 financial year
Final investment performance numbers have now been received for the 2016-17 financial year.
- All of CSC’s default and non-default premixed investment options exceeded their return objectives over the 3 years to June 2017.
CSC’s primary investment objective is to maximise long-term real (i.e. above inflation) returns for members, targeting 3.5% p.a. over rolling three year periods for the Default, Balanced and MySuper Balanced Options whilst keeping risk to an acceptable level, defined as a probability of loss in no more than three to four years out of 20. This investment objective is designed to provide adequacy in retirement for our average member. “Adequacy” is defined by the ASFA (Australian Superannuation Fund Association) “comfortable standard”, which accounts for post-retirement cost-of-living adjustments.
Over the rolling 3-year investment horizon to 30 June 2017:
- All of CSC’s default and non-default premixed investment options exceeded their return objectives over the 3 years to June 2017 (Figure 1).
This performance reflected CSC’s strategic positioning in private assets; equity benchmark management; and foreign currency management.
Figure 1: CSC Investment returns over 3 years to 30 June 2017
Over the 1-year sub-period to 30 June 2017:
- All of CSC’s investment options exceeded their return objectives over the 1 year to June 2017 (Figure 2).
- Our returns are consistent with the investment strategy adopted - We aim to avoid a higher proportion of the losses that result through weak-market cycles and capture most of the upside in strong markets. This means relative underperformance of our peers in strong markets and relative outperformance through falling markets. In this way, the cumulative return that we can generate for our members over the long term is expected to be both competitive and relatively more consistent.
- In 2016-17 domestic and international equity markets performed strongly, therefore our default fund performance was lower than some comparable funds, though still strong at 9.4%.
Figure 2: CSC Investment returns over the 1 financial year to 30 June 2017