Investment in infrastructure and unlisted assets among superannuation funds is a vital performance differentiator between industry and retail superannuation funds, according to the Industry Super Network (ISN).
Amid continuing discussion about the role of super fund investment in infrastructure, ISN chief economist Dr Sacha Vidler said the outperformance and reduced volatility of unlisted assets has been an important source of competitive difference for industry funds.
He added it was a vital factor in their impressive investment performance.
ISN used figures from Chant West on growth funds from 2009 to indicate that retail funds only allocated 9 per cent of their portfolio to unlisted assets while industry funds allocated 28 per cent.
“This different approach to asset allocation has proved to be a vital performance differentiator for industry super funds as unlisted assets have both outperformed most other asset classes and also been less volatile,” Vidler said.
Vidler said that during the global financial crisis, unlisted property and unlisted infrastructure experienced a shorter and shallower downturn than the precipitous crash which occurred in listed markets.
However, one industry fund, MTAA Super, had a high exposure to unlisted assets and has recently been the subject of scrutiny over investment performance.
