Our key considerations
We design strategies for super with the view that it will be invested to support our members’ goals
Given super is a long-term investment, it is likely to experience multiple periods where the markets go up, fall, and recover as a continuous cycle. We take this market behaviour into account when making investment decisions for our members’ super.
For our MySuper members who have a default investment option, we also consider their age, investment returns, market volatility forecasts, and expected tolerance for risk over time resulting in an ‘age-appropriate’ approach to the amount of investment risk they’re exposed to.
This approach is called ‘Lifestage investing’, targeting higher returns when members are younger, and reducing exposure to investment risk as they get closer to, or are in retirement. This approach can help members who prefer to take a ‘hands-off’ approach to their super.
For members who prefer to personalise their super investments, these considerations are still relevant. As the saying goes, "it’s time in the market, not timing the market" that counts. In other words, stay invested for as long as you can, and try not to worry about knowing when the ‘best’ time is to invest.
Our investment menus provide you with as little or as much control as you choose to have over your super
We know that a 'one-size-fits-all' approach to investing is a thing of the past, and that more of our members like to have the choice over where and how they invest their super.
This is why we’ve created the following:
The in-house default Lifestage options
We manage the investments for our super members, as well as the level of investment risk they’re exposed to as they head closer to, or are in retirement.
The simple investment menu
This option gives members more control over their super while keeping it simple.
Members can choose from a Balanced, Defensive, or Growth portfolio, depending on their risk appetite, across diversified options that invest primarily across Australian and International shares, property, Australian and International Fixed Interest, and Cash.
The full investment menu
This provides a selection of close to 40 investment options, offering members access to a range of asset classes and risk profiles.
Some well-known managers include Fidelity, Magellan, and Pendal, offering specialist investment options ranging across Australian and International shares, Technology and Sustainable investments. This is designed to give members even more control of their super, and the flexibility to choose investment options that are in line with their investment goals.
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Diversification
Sustainability
Diversification helps reduce investment risk
When designing our investment menus, we look for the track record, reputation, price, and team experience of the investment managers.
We also ensure the menus contain a broad selection across different asset classes – from defensive, e.g. cash and fixed interest, through to growth assets, e.g. Australian and International property, as well as specific assets like Infrastructure, Technology, and Sustainable Investing.
Why do we do this?
Given all investment markets tend to move in and out of different cycles, diversifying across different investments (that is, having money invested across a range of different markets, countries, asset classes – from cash through to shares – and even across different investment managers) can help to smooth out long-term overall returns.
Take a look at the chart below, which shows share market trends since 1970. The black line indicates a 'bear' market, or when the market moves in a negative trend direction.
The blue line shows periods when the market moves continuously in a positive direction – a 'bull' market. The average bull market has lasted 70 months, while the average bear market has run for only 14 months.
Australian All Ords Bull & Bear Markets September 2021
Source: Bloomberg / BTIS
Please note: Bear market defined by price decline of more than 20% from the peak. Month end prices have been used for the calculations.
Average Bull – length 64 months, 158%; Average Bear – length 14 months, -28%
The range of skill sets and depth of investment experience in our team helps to decide where and how to invest your super
Our in-house cross-functional team of 19 investment professionals have over 282 years of collective experience across equities, income and private markets asset allocation, risk strategies and research, investment specialists and sustainability.
Across a sub-section of our menu, this team curates a strategic selection of investment managers who regularly research the market and present us with investment opportunities for our members’ super. This applies to our Lifestage funds, our active, index diversified* and sector funds (e.g. Australian Shares, International Shares, Property and Fixed Interest).
Once an investment manager is selected, we monitor them to track that they’re performing according to their investment objectives and strategy, including sustainable and responsible investing (see below).
This way, members can be sure that we’re bringing a competitive and comprehensive selection of investments to cater to a range of investment goals.
We’re passionate about sustainable and responsible investing
Being a responsible investor is an extremely important principle at BT. We aim to do this while achieving competitive investment outcomes, offering a suite of investments that have long-term sustainability, and having measures of avoiding those which may underperform or fail.
Within our Lifestage, active, index diversified* and sector funds, we embed sustainability considerations in the investment process, when appointing underlying investment managers, and we monitor how issues like climate change and human rights are considered in their investment strategy on an ongoing basis.
And for the remaining options in our investment menus, BT recognises that members may seek investments aligned to specific environmental or social themes, or that exclude certain industries, companies or activities from their investment universe, based on their own values or preferences.
At BT we’ve been investing sustainably for many years, and we ensure our members can access this approach from our investment menu.
Have a read of our public Responsible Investment Position Statement (PDF) which explains when and how we incorporate sustainability across our range of products and investment options.
We’re led by an elected Trustee Board of professionals to govern your super. Their role includes overseeing the compliance and administration of the fund and to protect members' best interests, and we’re bound by specific legislation and regulations
Every time we make a decision about your investments, we’re guided by a professional board of non-executive directors, also known as the Trustee, who are ultimately responsibility for serving the best financial interests of our members.
We are also bound by three core pieces of legislation, including:
- The Superannuation Industry (Supervision) Act 1993 (SIS)
- The Financial Services Reform Act 2002 (FSR)
- The Superannuation Guarantee (Administration) Act 1992
There is also a robust suite of government agencies overseeing our day-to-day operations including:
- The Australian Prudential Regulation Authority (APRA) supervises super funds regulated under the SIS Act 1993.
- The Australian Securities and Investments Commission (ASIC) oversees Trustees’ compliance with the FSR as well as Trustees’ obligations regarding providing information to their members.
- The Australian Financial Complaints Authority (AFCA) makes sure there is a formal process for complaint resolution between super funds and members.
Super investment options
Why super is a long-term investment
Meet the manager
Hear from Corrin Collocott, our Chief Investment Officer, for insight into the experience and investment approach of BT Investment Solutions.
* Excludes options managed by Pendal
This information is current as at 20 October 2021.