Superannuation Discussion + market volatility

[Brissy1]

8.46% is on the high end of the long term average

And especially if post tax it’s a pretty good yearly result

Compare to the Comsuper Militarysuper options for various funds including a balanced one

How we perform

Here’s how your investment options are performing.

www.csc.gov.au

A reasonably good year for all, on average.

I left AuSuper a few years ago, didn't like their chairman's comments and possibly direction. Not suggesting others leave, but am suggesting being watchful and regularly compare.

I'm supportive of Industry Funds, but get concerned when the boards get "ideological" or too close to any government/union. I remember being staggered when Qsuper invested in the $5Billion Brisbane airport tunnel to help it gets up, even though blind freddy could see the projections were fanciful.

 

[RooFlyer]

Many other industry funds seemed to be a fair bit higher (not 100% sure if Aussie Super balanced is a true equivalent of the others' growth options). Likely due to US stock exposure as they have been going gangbusters

Usually you'd expect a 'growth' fund to outpace a 'balanced' one but there would be some additional risk.

 

[andye]

Usually you'd expect a 'growth' fund to outpace a 'balanced' one but there would be some additional risk.

Agreed which is why I was surprised to see them side by side on the comparison sites

 

[andye]

A reasonably good year for all, on average.

I left AuSuper a few years ago, didn't like their chairman's comments and possibly direction. Not suggesting others leave, but am suggesting being watchful and regularly compare.

I'm supportive of Industry Funds, but get concerned when the boards get "ideological" or too close to any government/union. I remember being staggered when Qsuper invested in the $5Billion Brisbane airport tunnel to help it gets up, even though blind freddy could see the projections were fanciful.

Which makes it interesting that the "lefty" union-donating industry funds regularly outperform the capitalist shareholder-supporting ones.
As a migrant, it was one of the clearest demonstrations that you don't have to be from the right to manage big money in Australia

 

[jakeseven7]

8.46% is on the high end of the long term average

And especially if post tax it’s a pretty good yearly result

Compare to the Comsuper Militarysuper options for various funds including a balanced one

How we perform

Here’s how your investment options are performing.

www.csc.gov.au

Back end of the pack though for F24.

AFR did a good interview with the CIO on why they had a sloppy year, essentially he explained they were late on the US tech surge and by the time they got in, had missed the early upswings. You can listen to it on the AFR podcast.

———

AustralianSuper also delivered lower returns than rivals for its default option in the last financial year at 8.5 per cent. However, chief investment officer Mark Delaney said the fund was too defensive around Christmas and missed out on much of the tech rally as a result.

Super giant is ‘comfortable’ being among the worst funds for FY24

Industry super fund Hostplus’ annual return for its default product was among the lowest in the sector, but CIO Sam Sicilia says its long-term plan is solid.

www.afr.com

 

[jakeseven7]

Many other industry funds seemed to be a fair bit higher (not 100% sure if Aussie Super balanced is a true equivalent of the others' growth options). Likely due to US stock exposure as they have been going gangbusters

One of the reasons Aussie super gave.

Industry super giant lags rivals with 8.5pc return

Defensive positioning against equities stung AustralianSuper early in 2023-24, but growing its exposure to soaring technology stocks helped it recover.

www.afr.com

 

[JohnM]

I have too much wine in the cellar

You do know that you have at least one local friend of very similar vintage...

I'd even include @Daver6 in the local list - although as a young 'un he's still in need of considerable cellar time to reach full maturity...

 

[cove]

Thanks @JohnM for your thoughts on my overloaded cellar. Typically when we go out I go French bubbles and a really good red.

 

[Daver6]

You do know that you have at least one local friend of very similar vintage...

I'd even include @Daver6 in the local list - although as a young 'un he's still in need of considerable cellar time to reach full maturity...

I'm a male. I'll never reach full maturity

 

[JohnM]

I'm identify as a male. I'll never reach full maturity

Hey old-fashioned Gen-X, corrected that to bring you into the zeitgeist.

 

[burmans]

8.46% is on the high end of the long term average

And especially if post tax it’s a pretty good yearly result

Well except there has been plenty of reporting of the last financial year as somewhat better than 'good'. I am not shocked but I think there would have been expectations of 10+ % for such a year.

 

[Daver6]

Hey old-fashioned Gen-Z, corrected that to bring you into the zeitgeist.

Hey Boomer, gen-X thank you.

 

[RooFlyer]

OK. At $137, CBA now getting ridiculous. Time to sell a hundred or so (big travel bills coming up ).

 

[burmans]

OK. At $137, CBA now getting ridiculous. Time to sell a hundred or so (big travel bills coming up ).

Ridiculous sure, but remember plenty predicted it was about to drop well below $100 when it was at $115 and look where we are now!

Not quite sure what the appropriate saying is for the opposite to ‘don’t try to catch a falling knife’ but CBA surely epitomises it.

 

[RAM]

Many other industry funds seemed to be a fair bit higher (not 100% sure if Aussie Super balanced is a true equivalent of the others' growth options). Likely due to US stock exposure as they have been going gangbusters

I suspect (strongly) that the relatively lower performance is due to the largish % holding in unlisted vehicles which 'smooth' their performance (in downturns often mainly for some reason...). A bit like how the CPI has housing costs calculated over a rolling 3 yr period (IIRC).

I could be wrong...

 

[MARTINE]

Ridiculous sure, but remember plenty predicted it was about to drop well below $100 when it was at $115 and look where we are now!

Not quite sure what the appropriate saying is for the opposite to ‘don’t try to catch a falling knife’ but CBA surely epitomises it.

Warren Buffett:
‘When people are greedy be scared… When people are scared be greedy’

 

[RAM]

Ridiculous sure, but remember plenty predicted it was about to drop well below $100 when it was at $115 and look where we are now!

Not quite sure what the appropriate saying is for the opposite to ‘don’t try to catch a falling knife’ but CBA surely epitomises it.

CBA is one of those stocks (now for around 30 years) that analysts & fund managers love to hate - after making fools of them so many times in their 'market timing'.

I've mentioned this before, but in the early 2000s my better half went along to a lunchtime S&P event for fund managers & bankers where towards the end they asked some questions back. After a few they asked how many of you bought CBA in the float - arms up. Everyone.
Then - how many took stag profits - arms down. Something like half dropped.
How many once the price doubled, trebled - you get the picture. Guess who ended up the only one with their arm up?

"Congratulations, CBA outperformed every other company on the ASX..."

Moral of the story, most investors, (so-called) professional or otherwise too often cut their profits & let their losses run.

Nobody ever likes to acknowledge they've made a mistake...
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A good rule of thumb is to have a notebook which you diligently keep current.

For each investment you have there should be an entry. That should have in no more than say a dozen words each, the top three reasons why you bought the investment.

Noise is always a problem - IMHO the most important question to focus on is 'What's changed?'

Brokers etc only make money through transactions, so does the taxman. If you're worrying about an investment, to the point of loss of sleep then the decision is made for you.

Some more 'sophisticated' investors run the numbers and buy insurance if it is a potentially better outcome. If you've been clever (lucky) enough to have created a large (giant?) unrealised profit and fear the end of the world is nigh - but could be wrong (again?) - some look at buying slightly out of the money long dated (not the ones expiring next, or perhaps even the one after that) put options.

That way if they're wrong then they haven't made the tax man happy and if they're right then they're pretty much covered.

Lots of reading up is worthwhile.

My own rule is N E V E R ever sell a put option - I've and places I've worked have bankrupted too many experts, and wiped out the capital of one of the Official Dealers in the mid/late 1980s who thought selling OTC out-of-the money put options on 10yr bonds was easy income.

 

[JohnM]

Hey Boomer, gen-X thank you.

Oops, corrected.

Hard keeping up with the @rse-end of the alphabetic identifiers.

 

[burmans]

Warren Buffett:
‘When people are greedy be scared… When people are scared be greedy’

Warren Buffet is a very smart man and much as I agree with this in principle (and have made money from it) I and many others have learnt that going against the market can be painful! Not all have quite the skills of Warren Buffet.

 

[SYD]

Warren Buffet is a very smart man and much as I agree with this in principle (and have made money from it) I and many others have learnt that going against the market can be painful! Not all have quite the skills of Warren Buffet.

Yes, “Buy low, sell high” is another great in principle thing but no one is ringing a bell at either point in time and therefore also requires a level of understanding of what it is you’re buying.