Diversification and changing my investment mix to suit my life stage

Diversification is the spreading of an investment over a range of asset classes, industry sectors and regions, with the aim of reducing risk.  

You can select investment portfolios that:

• spread your investment across a number of asset classes such as shares, property, fixed interest securities and cash,
• invest in a particular asset class, or
• diversify across a range of investment managers.

Most corporate super members are initially set up in the fund's default investment mix. While the default investment mix is specifically designed to suit the majority of investors, your appetite for risk verses returns and your investment goals may differ and change throughout the course of your life.  

In addition, over 80% of Australians taking super via their employer never change their investment strategy. This means many people with a low risk tolerance could have large parts of their super invested in higher risk assets such as shares. It’s worthwhile reviewing your investment option from time to time to determine whether it still suits your situation and investment strategy. For example, younger people who have more time in the market to ride out market highs and lows may prefer to be more aggressive in their investment options, whereas those closer to retirement may choose low-risk options in order to preserve their capital.

Some funds offer Lifestage options and are designed to meet the need to change your investment mix as you move through life. These funds automatically adjust your asset mix for you as you age.