Growth Smoothed
The only difference between our Growth Smoothed and Growth investment options is a reserve. Growth Smoothed has a reserve set aside to help smooth the ups and downs in investment returns from year to year. The reserve is added to investment earnings for the year and 60% of the total forms the earning rate (after fees and tax), with the other 40% kept in reserve for next year.
Some years the earning rate for Growth Smoothed will be higher than Growth, and other years it will be lower. Because of how the reserve works you are unable to return to the Growth Smoothed option once you have left it.
Growth Smoothed is the automatic option for Accumulation Benefits Fund. It is closed to Retained Benefit accounts, Spouse accounts and pension accounts.
Investment objective
Returns of 5% p.a. above inflation over rolling 5-year periods.
Who does it best suit?
Members already in this option who are seeking high returns over periods of 7 years or more, with the lower risk of negative returns due to smoothing.
Strategic asset allocation
The annual report to members shows the actual asset allocation at 30 June each year.
% | |
|---|---|
| Return-seeking assets | 77.98 |
| Australian shares | 25.65 |
| International shares | 25.65 |
| Property | 15 |
| Alternatives | 11.68 |
| Risk-controlling assets | 22.02 |
| Alternatives | 7.02 |
| Fixed interest | 15 |
| Cash | 0 |
Earning rates
Past performance is not an indicator of future performance.
| Year ending 30 June | Accumulation accounts % p.a. | Pension accounts % p.a. |
|---|---|---|
| 2008 | 2.25 | 2.16 |
| 2007 | 14.95 | 16.13 |
| 2006 | 14.09 | 15.10 |
| 2005 | 12.16 | 12.80 |
| 2004 | 9.62 | 10.35 |
| 5-yr avge (% p.a.) | 10.52 | 11.19 |
| % p.a. over CPI | 7.40 | 8.07 |
Risk
Positive returns expected 12 out of 13 years
Total fees (2007/08)
0.73% p.a.
