Global markets have reacted to renewed concerns at a stalled period of economic growth in both the US and a number of European economies by a spate of selling down major indices. Additional anxiety is being felt with the dubious historic first downgrade of the credit rating for US sovereign debt. It’s only natural to be concerned about how this volatility might affect the value of investments held within your superannuation.
It can be tempting to move your money into less volatile investments within superannuation as a result, but it’s important to keep volatility in perspective and recall that historically investors have generally been rewarded in the long term for taking the risk of being exposed to share based investment assets.
Just as negative market periods can be a short sharp reaction on the downside so can recoveries on the upside. It is important to understand that by taking pre-emptive actions to prevent further declines you may miss a significant part of the recovery. Forecasting short term market movements is often an exercise in chance and an individual is best to consider their own goals and objectives over their intended investment time horizon.
Energy Super offers 9 different investment options designed to operate over varying investment time frames ranging from the defensive positioning of the Cash Deposit option up to Australian and International Share offerings. When commentators talk about the market they are generally referring to the share market consisting of thousands of corporations across a multitude of industries. A tenant of prudent investment is diversification as a means of ensuring coverage across a range of different investment assets all of which will generally perform differently at differing points of time.
Focusing on the bigger picture and both your need for return and your tolerance for risk can lead to a compromise with more secure investments not delivering the returns that more volatile investments can generate. Remember to be confident in the quality of your investments and their ability to show gradual returns. Don’t be nervous about inevitable short-term market volatility as the volatility generated will also deliver positive returns over time.
For further information regarding your account and investment options please contact 1300 4 ENERGY (1300 436 374) or follow this link to check Energy Super’s latest investment performance.
Super’s investment performance can now be accessed via your mobile phone. Simply type in m.energysuper.com.au on your iphone, android phone or tablet device.
This document is intended to contain information and not advice. It should not be relied upon as advice or take the place of professional advice. It does not take into account your specific objectives, financial circumstances or needs. You should consider whether the information is appropriate to your specific circumstances before taking any action. If you wish to obtain a financial product as a result of the general advice, you should obtain a Product Disclosure Statement in relation to that product before taking any action. You should consider obtaining specific advice before making any decisions with respect to financial products.Electricity Supply Industry Superannuation (Qld) Ltd (ABN 30 069 634 439 AFSL 336567) is the Trustee of Energy Super (ABN 33 761 363 685).