Has Future Super changed its investment strategy given the negative returns?
No strategic changes have been made as a result of recent negative returns and higher volatility in share markets. Future Super takes a rules-based approach to investment, which aims to deliver results over a longer term time horizon.
We continue to believe it is possible to invest in a way that has a positive impact on the world, and with ethics in mind, while also providing for our members’ retirements.
After the surge in fossil fuel prices in 2022, there was some debate in the media about whether super funds could deliver great returns for members and act on climate change.
Super is a long term investment. It’s designed to see you through your whole working life and into retirement. At Future Super, we believe the threat of climate change should be front of mind in our long-term investment thinking. We also believe in investing in a future that is worth retiring into.
Our screening work to protect you from harmful assets remains consistent, but this year it’s given us a performance edge. Thanks to our screens, we’ve been more heavily invested in the sectors that have performed the strongest this past financial year.
We screen out many of the big banks, locally and internationally, because they fund fossil fuel projects. And recently, performance for bank stocks has been held back by recession fears.
Utilities (like energy companies) were one of the weakest performing sectors globally*. Future Super’s screening approach paid off here too as we deliberately avoid investing in the vast majority of utilities companies due to their reliance on fossil fuels.
This sector based advantage in our portfolio was backed up by earlier decisions to move some of our income assets into being inflation linked (known as floating rate). These are the sorts of decisions our investment team makes by constantly monitoring the markets on your behalf.
We want to invest for a better future - for the world and for our members. What these positive returns show is the power of doing both at the same time.
*According to the MSCI World Index. Source: FactSet.
See How We Invest for more information about our screening and investment processes, and what we mean by fossil fuel companies and investments.
All information provided is general in nature only and does not take into consideration your personal objectives, financial situation or needs. Please read the relevant Product Disclosure Statement, Target Market Determination and Financial Services Guide available at https://www.futuresuper.com.au/documents-and-forms/ and consider whether Future Super is appropriate for your needs before investing. We recommend you seek independent personal financial advice before investing.
Past performance is not a reliable indicator of future performance.