Perpetual fund surpasses five-year target
Investors in Perpetual Investments' Diversified Real Return Fund have enjoyed annual returns of 7.5 per cent, as the fund surpassed its target of CPI plus five per cent per annum, in the five years to 31 December.
The fund also delivered volatility of 3.5 per cent per annum over the same period, while the Australian Securities Exchange (ASX) 200's annualised volatility was 12.2 per cent.
Perpetual's head of multi assets, Michael O'Dea, said that in the current low interest rate and high volatility environment, the fund offered investors a prudent alternative to protecting a growing capital.
"Real return funds are becoming increasingly attractive to investors and advisers seeking investment opportunities which balance the desire for return with risk," he said.
"Perpetual's Diversified Real Return Fund is designed to act as a ‘shock absorber' during periods of extreme volatility, which means investors are less likely to suffer large losses when the market falls.
"By actively and continually altering the asset allocation in response to changing market conditions, the fund aims to provide greater certainty of investment outcomes in volatile times and give investors peace of mind.
"In a climate of low cash rates and low government bond yields, selecting less risky investments merely results in achieving low returns. When inflation is also taken into account, there is a genuine risk of not growing capital above rises in the cost of living.
"Real return funds offer a simple solution to today's complex problems faced by investors, helping them access a wide variety of asset classes they may not be able to hold directly, without taking on more risk than they can afford to take."
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