POWERED BY MOMENTUM MEDIA
AI rally provides strong uplift to MLC’s FY24 return
MLC has announced a return of 9.8 per cent for its MySuper Growth Portfolio, the default option for members under the age of 55.
Meanwhile, its MySuper Conservative Balanced Portfolio, for members between 55 and 65 years of age, returned 7.7 per cent and its MySuper Cash Portfolio, for members over 65, returned 3.9 per cent.
MLC also unveiled returns of 12.2 per cent for its High Growth option and 16.1 per cent for the MLC Aggressive option among its ready-made portfolios.
Broadly, Steve Gamerov, head of diversified portfolios at MLC Asset Management, credited the strong result to significant international stocks exposures, particularly in US markets.
“Global stock prices made especially solid gains given the continued optimism on the prospects for artificial intelligence (AI) and renewed hopes for lower interest rates later this calendar year,” he said.
“In particular, the largest AI chipmaker – Nvidia – a company in which the MySuper Growth Portfolio is invested – led the charge with a 192 per cent stock price gain given strong revenue and profit growth.”
Gamerov added that Nvidia’s stock has experienced a “remarkable” 3,001 per cent price rise over the last five years.
He also attributed the fund’s performance to its investments in extended and alternative credit strategies.
“The return patterns from these strategies differ from those provided by shares and so are valuable sources of diversification within the portfolio, as well as returns,” he said.
According to the executive, the fund benefited from thoughtful allocations in its unlisted real estate investments, which are currently weighted towards the industrial sector that benefits from the tailwinds of digitisation and e-commerce.
However, he said the returns from these unlisted assets were “overshadowed” by the strong rally of global shares.
Looking ahead, Gamerov said tech stocks are beginning to look “stretched” and cautioned investors not to “lose sight of finding opportunities elsewhere” against the heavily tech-powered share rally.
“We enter the new financial year with a cautious but constructive outlook,” he said.
“Consistent with this cautious view, we will continue to rebalance the portfolio into markets that have underperformed while taking gains in markets that have outperformed.”
AUTHOR
Rhea Nath
Rhea L Nath is a journalist on Super Review and InvestorDaily, with a focus on funds management, superannuation, and institutional investment. Previously, she covered small business and entrepreneurship news at Dynamic Business and multicultural issues at Indian Link Media Group. In 2022, she was named Young Journalist of the Year at the NSW Premier’s Multicultural Communications Awards.
Recommended for you
The International Monetary Fund has raised concerns about liquidity risks within Australia’s superannuation system due to a growing share of illiquid investments, such as private equity and credit.
As new superannuation payment rules approach, a firm has underscored the need for funds to brace for significant technological adjustments.
There was a 5 per cent rise in complaints to AFCA relating to superannuation in the financial year 2023–24, according to its annual report.
APRA has ramped up its scrutiny of superannuation fund spending, particularly targeting discretionary expenses like travel, entertainment, and conferences that may not be in the best interests of members.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.71 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
29.27 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
27.22 3 y p.a(%)
