Our investment philosophy articulates our beliefs, responsibility to members and investment opinions. They provide a framework for the management of the Fund’s investments, strengthening investment decision making and governance.
They act much like a charter or broad set of ‘rules’ when making investment related decisions.
Super is a long-term investment, which brings with it both opportunities and responsibilities
We recognise that the time horizon and investment attitude of individual members can vary. We will invest in strategies that deliver real returns over the medium to long-term while structuring individual investment options with a variety of risk/return profiles to suit different member characteristics.
The investments supporting members’ accumulation and pension accounts, as well as those supporting the Fund’s defined benefit liabilities, can have different objectives. We will take into account the time-frame, tax, risk tolerance and other factors when designing and implementing investment options.
Members may have a choice of super fund so we aim to deliver real returns that are market competitive over the medium to long-term for the Fund’s investment options.
We only take risks when we believe the investment portfolio will be appropriately rewarded
Asset allocation drives most of the return and volatility within our investment portfolios. We will take a dynamic approach to asset allocation where we have conviction that certain asset weightings will improve the chance of delivering on the real return objectives.
Diversification both within and across investment sectors is a sound strategy for reducing volatility of returns. We provide appropriate diversification across our managed options, balanced with distinct mandates for each investment’s contribution to the overall portfolio.
As accumulation and pension members wear the risk associated with their investment in the Fund, we aim to capture most of the upside in strong markets while minimising losses when markets are weak.
Fees, costs and taxes matter and need to be effectively managed
We aim to deliver value for our members. Fees, costs and taxes all have an impact on end member outcomes and we aim to carefully manage their impact to provide members with the optimal products and services they deserve.
We believe that active investment management within certain sectors can add value over the long-term – but only when we believe the contribution from a particular investment through increased return or reduced risk warrants any additional cost.
Conviction and transparency are paramount when investing other people’s money
We adopt a high standard of openness and transparency. Our investment beliefs, objectives and strategies are clearly articulated and made available to members and the wider community.
We only invest in products that we understand, are managed by appropriately qualified external investment managers who align with our beliefs and have a high conviction that the investment will make a positive and meaningful impact on total risk/return position for the Fund.
In delivering real returns which are market competitive, we will invest responsibly by supporting positive environmental, social and governance initiatives where it is practical to do so.
Understand the investment options available to you.
We have developed a 10-point investment philosophy to reflect our investment beliefs. They serve as a reference checkpoint for all of our investment decision making.
We aim to deliver real returns over the medium to long term to our members, by offering a variety of tailored investment solutions. Our defined benefit portfolio is managed to achieve and maintain full funding.
We recognise that accumulation members have a choice. Therefore, in addition to strong real returns, we aim to deliver competitive returns over the medium to long-term.
We aim to provide members with stable and consistent returns over time. This is achieved in two ways. First, we build portfolios diversified by asset class and investment manager. Second, we aim to capture most of the upside in strong markets, but to minimise losses when markets are weak.
Asset allocation dictates most of our return and volatility. Therefore, we adopt a dynamic approach to managing the asset allocation over the medium term in order to improve the probability of meeting each option’s real return target.
Each investment must have a positive and meaningful impact on total risk-adjusted return. This means we only make investments where we have a strong conviction that our members will be appropriately compensated.
We outsource our asset management to appropriately qualified external investment managers. We aim to ensure their investment philosophy aligns with ours and that they build appropriately diversified portfolios.
We believe in using active management within certain sectors to add value over the long term. However, this is only when we believe the incremental contribution to the portfolio – through increased return or reduced risk – warrants the additional cost.
We aim to deliver our members value for money. Fees, costs and taxes all count against members’ returns and so we aim to optimise them in order to achieve each option’s real return target and provide members with the services and advice they need and deserve.
In managing other people’s money, we adopt a high standard of openness and transparency. We only invest in products we understand and commit to being at the forefront of disclosure in our industry.
We aim to deliver real returns to members while investing responsibly by supporting positive environmental, social and governance initiatives where it is practical to do so.
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