SMSFs retreat to safety of cash

29 July 2016

Self-managed superannuation fund (SMSF) investors are turning to the relative safety of cash and term deposits in the face of continuing volatile markets, according to the latest assessment from OneVue.

The company released data this week showing that investment in listed shares fell to their lowest level in five years during the June quarter.

According to the data, investment in listed shares by OneVue SMSF investors dropped to 19.23 per cent in the June quarter, down nearly 10 per cent from two years' ago and more than three per cent in the past year. The listed shares category was 22.52 per cent one year ago (June 2015 quarter) and much higher two years ago at 28.93 per cent (June 2014 quarter).

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"SMSF investors are continuing to react with caution to current volatile market conditions, by turning towards cash and term deposits and managed funds," OneVue head of product and transactions, Brett Marsh said.

According to the OneVue data, SMSF investment in cash and term deposits rose to 21.07 per cent for the June quarter — up from 18.83 per cent one year ago (June 2015 quarter).

The unitised trusts (managed funds) category rose to 28.7 per cent, up from 24.7 per cent from a year ago (June 2015 quarter). This continued to be the dominant category for OneVue SMSF investors, attracting more investment than any other asset category.

Investment in separately managed accounts (SMAs) held steady at about a quarter of the total OneVue SMSF investment pool, at 25.13 per cent (compared to 24.7 per cent June quarter 2015). Direct property holdings stayed fairly steady at 8.61 per cent, up from 7.43 per cent in June 2015.

Advisers were continuing to access professional investment management through actively managed and passively managed trusts, in particular asset classes such as international, infrastructure and alternatives, Marsh said.

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