AustralianSuper Jumps Record 20.4% for 2021 Fiscal Year

AustralianSuper reported a 20.4% jump in returns for the 2021 fiscal year, posting the biggest returns in the fund’s history after last year’s market recovery, the superannuation fund said Monday.

Australia’s largest pension fund has grown to about A$225 billion (US$169.48 billion) in assets, as of the end of June. With annualized returns of 9.49% over the past 10 years, AustralianSuper is also among the nation’s top performing allocators.

The institutional investor will continue to keep a heavy tilt toward growth assets in the portfolio, according to AustralianSuper Chief Investment Officer Mark Delaney. The allocator has traditionally kept a greater allocation to growth assets in listed shares and private equity.

“AustralianSuper is a long-term investor and we have a pro-growth stance in allocating assets,” Delaney said in a statement.

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Going forward, the fund will also seek opportunities in infrastructure, private equity, and property and credit asset investments, he said.

The allocator has posted better than benchmark returns over the life of the fund. AustralianSuper returned 9.6% for its three-year return; about 10.4% for its five-year return; roughly 9.7% over the past 10 years; and about 7.5% over the past 15 years.

Separately, AustralianSuper has also made a A$774 million (US$583 million) investment into Moorebank Logistics Park, a major logistics facility in the country. In the future, AustralianSuper hopes the property could service Port Botany, a deepwater seaport in Sydney that the superannuation fund has a 20% stake in.

The asset owner made the investment as part of a consortium of investors that includes logistics specialist LOGOS, as well as French insurance company AXA, Canadian real estate firm Ivanhoé Cambridge, and Australian financial services firm TCorp (NSW Treasury Corporation).

About A$10 billion (US$7.5 billion) of the fund’s money is invested in property assets, which is an allocation the superannuation fund is planning to increase, AustralianSuper Head of Property Bevan Towning said in a statement.

AustralianSuper has invested before with LOGOS to make property investments. In 2019, the allocator joined the logistics specialist for an investment into Wiri Logistics Estate in New Zealand.

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Tags: Australia, Australiansuper, Pension Funds

Japan’s Government Pension Investment Fund (GPIF) reported a record 25% return on its investments, or 37.8 trillion yen (US$339 billion), for the fiscal year ended March 31, raising its total asset value to 186.16 trillion yen, or approximately $1.68 trillion. Its returns marked a record for the fund dating back to its inception in 2001.

The robust returns were buoyed by the portfolio’s foreign and domestic equities, which gained 59.42% and 41.55%, respectively, for the year. Foreign bonds returned 7.06% for 2020, while domestic bonds were a drag on the fund, losing 0.68% during the year.

For the fourth quarter of 2020, the fund’s portfolio returned 5.65%, or approximately 10.04 trillion yen. And like the full-year 2020 results, the strong return was led by foreign and domestic equities, which returned 12.04% and 9.26%, respectively, for the quarter.

The performance is all the more impressive considering that more than a quarter (25.92%) of the portfolio is invested in underperforming domestic bonds, though the results benefited from the fund managers reducing the allocation to the asset class from 35% last year. The 10% was shifted into better-performing foreign bonds. Foreign equities account for 24.89% of the assets, while foreign bonds and domestic equities make up 24.61% and 24.58%, respectively. It uses mainly passive exchange-traded fund (ETF) strategies that reflect the markets.

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The fund also allocates 5.7 trillion yen, which is the equivalent of more than $51.4 billion or approximately 3% of the portfolio, to environmental, social, and governance (ESG) indexes, and it owns approximately 440 billion yen in green, social, and sustainability bonds issued by multilateral banks including the World Bank.