skip to log on skip to main content
VoiceOver users please use the tab key when navigating expanded menus

ANZ Smart Choice Super report: June 2021

Published 23 August 2021

Returns lift as vaccine rollout progresses

ANZ Smart Choice Super Lifestage investment options' performance (%)

Investment Option

3 months

1 year

3 years (p.a.)

5 years (p.a.)

1940s

3.30

8.31

 5.03

4.69

1950s

4.14

10.88

 5.91

5.75

1960s

5.42

16.95

 7.56

7.65

1970s

6.22

20.71

 8.57

9.00

1980s

6.58

22.58

 9.04

9.62

1990s

6.52

22.76

9.12

9.76

2000s*

6.41

22.43

8.93


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  
* The inception of the 2000s fund was on 18 February 2017 so there is no performance data available for five years.

Based on your decade of birth, the table above shows how your investment option has performed in the June 2021 quarter (the ‘3 months’ figure), and over the past one, three and five years.

All of ANZ Smart Choice Super’s Lifestage investment options saw strong positive returns during the June 2021 quarter. While COVID-19, particularly the Delta strain, continues to challenge societies and economies, and there is clearly a way to go before full global economic reopening, investor sentiment has remained positive as COVID-19 vaccines have started to roll out and economies recover. Policy makers are also showing their commitment to driving the global recovery for some time yet and key economic signals point to continued economic healing and growth.

Over the year to June, we can see just how much the pandemic recovery has played out in investment markets with the Lifestage funds returning very strong performance of 8.31% for the most defensive up to 22.76% for younger cohorts. Please read below for an Investment Team update on the factors that have driven investment performance.

“The SuperRatings survey groups funds together with similar allocations to growth assets. Smart Choice funds have performed above the median manager in the 1940s, 1950s, 1960s, 1980s, 1990s and 2000s Lifestage options over the last quarter and the majority of the Lifestage cohorts have also performed above the median manager across the year”. ANZ Smart Choice Portfolio Manager, Manish Utreja, said “Our disciplined, strategic approach has seen us deliver for members as the global economy has started to heal. We continue our focus on delivering returns that will support our members to achieve their retirement goals.”

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

1940s

3.30

8.31

 5.03

4.69


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

1950s

4.14

10.88

 5.91

5.75


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

1960s

5.42

16.95

 7.56

7.65


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

1970s

6.22

20.71

8.57

9.00


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

1980s

6.58

22.58

9.04

9.62


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

1990s

 6.52

22.76

9.12

9.76


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

2000s*

 6.41

22.43

8.93

_


Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. Please note that all returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.  
* The inception of the 2000s fund was on 18 February 2017 so there is no performance data available for five years.

A portfolio mix set to deliver

Effective diversification is the cornerstone of ANZ Smart Choice Super’s Lifestage investment philosophy. The investment portfolio is built across a range of assets, including growth assets such as Australian and international shares, property and, more recently, alternative investments. It also includes defensive assets such as fixed interest securities and cash. Our lifestage model automatically strikes an appropriate balance between growing and protecting your super based on your age.

Returns across Lifestages explained

Younger members (for example those who are invested in the 1990s and 2000s portfolios) are more heavily invested in growth assets. This means these members have seen the largest upswing in their super balances as economies have reopened following the pandemic recession, continuing to boost confidence in the earnings outlook.

Older members (those in the 1940s to 1960s lifestage options) have also seen very positive returns to their super balances over the year but, as they have more defensive assets as they approach retirement, they have lower exposure to growth assets so the returns aren’t at the scale of the younger cohorts. That said, these members weren’t as impacted by the pandemic recession as they were shielded by the larger exposure to defensive assets such as cash and bonds.

Our ANZ Smart Choice Super – smart investments tool is easy to use and explains how you are invested over time.

ANZ Smart Choice Super choose your own investment mix performance (%)

 

Investment Option

3 months

1 year

3 years (p.a)

5 years (p.a.)

Australian fixed interest^

1.30

-1.11

3.16

Australian shares

7.69

25.77

9.34

10.66

Global fixed interest

0.88

-0.51

3.20

2.11

Global property

8.45

26.90

4.78

3.85

Global smaller companies

5.78

35.64

10.29

12.56

International shares (hedged)

6.80

31.59

11.81

12.65

International shares (unhedged)

8.33

24.40

12.96

13.12

Cash

0.10

0.38

0.83

1.06

Conservative

2.72

6.16

4.28

3.98

Moderate

3.79

10.68

5.77

5.80

Growth

5.07

16.65

7.44

7.88



Note: Returns quoted use the unit price which is calculated using the net asset values for the relevant month end. All returns are after the deduction of investment fees and superannuation tax. Reporting data is to 30 June 2021 (p.a. = per annum). Past performance is not a reliable indicator of future performance.

^ The ‘Australian fixed interest’ fund’s inception was on 18 February 2017 and therefore the five-year performance data is not available.
 The ‘Global smaller companies’ investment option is not available to members of ANZ Smart Choice Super and Pension.

Reflecting re-opening and the prospect of economic growth supporting company earnings, investors favoured shares over defensive assets such as bonds and cash over the year. However, with the spread of the Delta virus causing a level of uncertainty, this may have seen some investors shift to holding more defensive assets and both Australian and global fixed interest options delivered a positive return, albeit small, for the June quarter. Conversely all other options performed very strongly over the quarter, ranging from 5.78% for the Global Smaller Companies option to 8.45% for the Global Property option. Over the year, returns were extremely positive with 20% to 35% gains across all options excluding Australian and global fixed interest. However, it is important to note that these strong gains reflect the strong ‘bounce’ from the lows of the COVID-19 pandemic recession in early 2020.

You can access your ANZ Smart Choice Super returns across the full suite of investment choices online or by visiting the ‘Investment portfolio’ page via your ANZ Smart Choice Super account.

Need more information?

  1. Check your super balance by logging onto your ANZ Smart Choice account.
  2. Find out how to ensure hasty decisions don’t erode your super.
  3. Understand why your super balance keeps changing.
  4. Read our COVID-19 FAQs.

Market and economic snapshot

Vaccine rollout continues to drive the economic recovery

The global recovery continued in the second quarter of 2021 with increased vaccine coverage supporting economies to take larger steps along the path to re-opening. More than 3.62 billion vaccine doses have been administered across 180 countries1 with some countries, such as England, looking set to remove all restrictions on the back of dramatically reduced hospitalisations and deaths.

While the global trend for COVID-19 infections has started to head up again, particularly the more transmissible variants, including the Delta strain, vaccination programs seem to be doing a good job at allowing reopening to continue as countries learn to live with the virus without rising cases overwhelming the hospital system. In Australia, snap lockdowns in New South Wales and Victoria at the time of writing have demonstrated the need for a massive ramp up in local vaccination programs to ensure that re-opening does not lead to the hospital system being overwhelmed.

Market optimism and consumer confidence has rebounded sharply since early 2020 on the expectation that the global economic recovery will be sustained with markets reaching new highs. As 2021 has progressed, we’ve seen a shift in share market growth from the technology ‘superstar’ stocks such as Netflix, Google and Amazon, that drove 2020 returns, to the stocks that benefit most from economic re-opening such as resources and banks. Many share markets are now above pre-pandemic highs. However, the rise of the Delta variant and the likelihood of other variants emerging has meant that countries with very low vaccination rates, like Australia, remain vulnerable to rolling lockdowns. While vaccines appear to be effective against the Delta variant so far, it is possible that other variants could more severely challenge vaccine efficacy.

Inflation risks explained

Policy makers, including the US Federal Reserve and Reserve Bank of Australia, have shown they’re committed to driving the recovery at least until we have adapted to live with the virus. Many financial commentators are discussing fears about a sustained lift in inflation, that is, a sustained rise in the price of goods and services. While inflation has lifted, this primarily reflects sectors that continue to experience supply disruption such as car manufacturing and building materials. Consumer demand is high, but many sectors have been ill-prepared to ramp up production quickly and prices have lifted. If the supply lines take too long to return to normal, temporary price increases, initially caused by scarcity, may become more persistent with expectations that inflation will become entrenched at a higher rate.

Importantly, for now policy makers are still comfortable trying to lift inflation and wages back closer to pre-GFC levels. They’d like more growth and inflation ‘in the back pocket’, at least back to target levels, as insurance before we enter the next downturn/recession. This would help reduce the risk of us seeing sustained deflation (a general decline in prices for goods and services) as has played out in Japan over many decades.

Australia’s economy is already back at pre-pandemic levels. In the first three months of 2021, Australia’s growth was better than expected following solid consumer spending, particularly in the services sector that includes transport, professional services, healthcare and entertainment for example. However, we shouldn’t forget that before the pandemic Australia’s economy wasn’t operating at capacity, meaning businesses weren’t tending to invest in additional capital or employ more workers to increase outputs. The current recovery will have to continue for some time yet to get Australia’s economy powering along at full capacity. The low vaccination rate is the primary roadblock to the Australian economy moving back to sustained growth.

A similar picture to Australia is apparent across most developed economies with sectors outside of technology struggling to deliver the jobs and wages growth experienced before the GFC. To some extent this shortfall has underpinned some of the relatively volatile politics we’ve seen in recent times.

What may be ahead?

While news is positive on the whole, policymakers worldwide are now facing the very difficult challenge of determining when, and in what form, they can return to pre-COVID life. Do we need to live with the virus, or can it be eliminated? The world will be looking to countries like England to assess how successfully they can reopen without overwhelming the hospital system. Success will ‘make or break’ the recovery.

Clearly a key risk is that virus variants may arise and challenge the efficacy of current vaccines. To date, while the Delta variant is possibly more infectious, it appears to be well controlled by vaccines.

One of the other key risks is inflation. Over the next decade we think inflation is likely to be somewhat higher than during the decade after the GFC and this may unsettle share markets, particularly as policy makers start to wind back current extraordinary stimulus measures, including ultra-low interest rates. At the moment share prices are expensive, boosted by supportive policy, so even a modest shift in policy expectations could rattle markets.

That said, currently most central banks expect that any large lift in inflation will be temporary and they’ll want evidence that there’s a sustained upward shift in wages supported by a continued fall in unemployment before they will start raising rates. This means it’s likely monetary policy will continue to be supportive until we return to pre-GFC type rates of growth and inflation at least.

If economies can continue to vaccinate, reopen, rebalance and support improvements to jobs and wages growth, risks should ease with the social and political pressures of recent years settling and that’s good news.  

 

If you’d like some help to develop a plan that will help to secure your financial future through all phases of the economic cycle, please speak to a financial adviser.

Make superannuation simple and straightforward

Smart Choice Super performance

Article

ANZ Smart Choice Super report: March 2021

We can see just how much the pandemic recovery has played out in investment markets with the Lifestage funds returning very strong performances.    

Article

ANZ Smart Choice Super report:
December 2020

The December 2020 quarter performed positively on the back of a brightening outlook for the global economy and the start of COVID-19 vaccine rollout.   

Article

ANZ Smart Choice Super report: September 2020

The September 2020 quarter performed positively on the back of more encouraging COVID-19 vaccine trial news and signs of global economic recovery. See the results.

1. Bloomberg COVID-19 tracker, data as at 19 July 2021.

“ANZ Smart Choice Super” is a suite of products consisting of ANZ Smart Choice Super and Pension (PDF 189kB)ANZ Smart Choice Super for employers and their employees (PDF 186kb) and ANZ Smart Choice Super for QBE Management Services Pty Ltd and their employees (PDF 198kb). The ANZ Smart Choice Super and Pension product is distributed by Australia and New Zealand Banking Group Limited (ANZ) (ABN 11 005 357 522). View the ANZ Smart Choice Super and Pension Target Market Determination (PDF 252kB). ANZ Smart Choice Super for employers and their employees and ANZ Smart Choice Super for QBE Management Services Pty Ltd and their employees are MySuper compliant products issued pursuant to the latest PDS available at anz.com/smartchoicesuper. ANZ Smart Choice Super is part of the Retirement Portfolio Service (the Fund) (ABN 61 808 189 263) and is issued by OnePath Custodians Pty Limited (ABN 12 008 508 496, AFSL 238346, RSE L0000673) (OPC), the trustee of the Fund. OPC is a member of the IOOF Group of companies, comprising IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. The Australia and New Zealand Banking Group Limited (ANZ) (ABN 11 005 357 522) brand is a trademark of ANZ and is used by OPC under licence from ANZ. ANZ and the IOOF Group of companies (including OPC) are not related bodies corporate. ANZ does not stand behind or guarantee these products.

Before re-directing your super or moving your money into ANZ Smart Choice Super, you will need to consider whether there are any adverse consequences for you, including loss of benefits (e.g. insurance cover), investment options and performance, functionality, increase in investment risks and where your future employer contributions will be paid. 

This information is of a general nature and has been prepared without taking account of your personal needs, financial situation or objectives. Before acting on this information, you should consider whether the information is appropriate for you having regard to your personal needs, financial circumstances or objectives.

All fees are subject to change. Other key features are relevant when choosing a super fund, including performance.

You need Adobe Reader to view PDF files. You can download Adobe Reader free of charge.

Fee Analysis: Research conducted by SuperRatings Pty Ltd, holder of Australian Financial Services Licence No. 311880 at the request of OPC. For a copy of the latest SuperRatings research, click here (PDF 452kB) or call 13 12 87.

For more information, visit superratings.com.au. SuperRatings does not issue, sell, guarantee or underwrite this product. Learn more about SuperRatings' criteria.

Top