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Super members suited to lifecycle approach: QIC
A ‘dynamic lifecycle’ approach to investing that is constantly adjusted to focus on a member’s real retirement objectives can enhance retirement outcomes, according to QIC.
The dynamic lifecycle approach now being offered by QIC will focus on investment returns according to a member’s particular stage of life, particularly as they move from accumulation to retirement, the fund manager said.
“The recent effects of the global financial crisis have illustrated the dangers of taking a static approach to asset allocation,” said QIC's managing director of lifecycle strategies, Michael Drew.
“Our research shows that dynamic lifecycle strategies that incorporate both account balance and age exhibit superior performance compared to typical current investment practices.”
These strategies need to be diversified and make use of the full range of investment tools, including downside risk protection, he said.
The strategy is consistent with ‘MySuper’ guidelines outlined in the Cooper Review that call for simpler, low cost, diversified products, Drew said.
“We are already getting a lot of interest from super funds regarding this new approach to lifecycle strategies and we will be in a position to implement and manage solutions before the end of the year.”
AUTHOR
Mike Taylor
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