Annual Returns
Due to the impact of the global financial crisis, annual investment returns for the 2008/09 financial year were negative from the asset classes of equities and property.
This was reflected in the annual investment return for those VicSuper investment options that have an allocation to one or both these asset classes.
Negative investment returns are expected from time to time. But the severity and impact of the global economic downturn - including the impact on investment returns - was largely unprecedented since the period of the Great Depression in 1929-1933.
It was a period of significant economic turmoil. But events surrounding this period were not dissimilar from previous economic downturns. Financial markets are cyclical, and have always followed periods of boom and bust. Prior to 2007, we saw global investment markets grow overconfident, and prices for assets such as company shares rose sharply as a result. Financial distress followed as some investors became fearful and banks reduced available credit - known as the 'credit crunch'.
To help super fund members seeking to build long-term wealth, or maintain a secure level of income in retirement, make sense of the past 12 months, we now answer some common investment questions.