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10 Nov 2018 (AFR) – Super investors warned about turbo-charging ‘safe’ funds to boost performance

[COMMENT: This is one topic that has puzzled myself for a long time – How on earth can we compare all of the ‘balanced’ super funds, for example, when they don’t use the same definition for ‘balanced’? We’re actually comparing apples with oranges, so to speak. So performance comparisons are out the window. And then, if any of the fund managers are playing tricks with their asset allocation in order to drive their fund results – well, that’s something else again!!]

(10 November 2018, AFR, p28, by Duncan Hughes)

Balanced superannuation funds breakdown (Moran Howlett Financial Planning, AFR)

Balanced superannuation funds breakdown comparisons (Moran Howlett Financial Planning, AFR)

‘Superannuation funds are boosting short-term performance by turbo-charging their high-profile “shop front” balanced funds with up to 90 per cent of higher-risk growth assets. Advisers recommend members reassure themselves about what is included in their “safe” investments by checking on the ratio of growth to defensive assets in their fund.

No standard investment definitions

‘Paul Moran, principal financial planner with Moran Howlett Financial Planning, says the traditional model is 55:45. But as shown in the pie charts, in some super funds the growth allocation is higher than 90 per cent. That can boost growth during bull markets when equity and property markets are increasing in value. But it could accelerate losses as markets begin to slow. ‘

Read the full story at AFR.com (might need AFR login access, or try: AFR.com/trial)

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Brainy's Share Market Toolbox. Read the honest truth about the sharemarket. Develop or fine tune your investing/trading strategies using share price charts (technical analysis), or learn about the investment strategies of others. Melbourne (Australia) based - supporting share market investors and traders to build wealth through smarter investing using my Share Market Toolbox arsenal of weapons to tackle the market.

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