4. Balanced Option
This option has a 60% allocation to growth assets (equities) and a moderate to high risk of fluctuating returns. Over the long term, returns are expected to be moderate to high.
10-year investment objective
To earn an investment return of 4% pa (after tax) above the rate of inflation over rolling 10-year periods.
Performance over 10 years
The compound average net earning rate over 10 years to 30 June 2009 is 4.20% pa, which is below the objective of 7.17% pa.
Performance over 5 years
The compound average net earning rate over 5 years to 30 June 2009 is 3.87% pa.
Likelihood of fluctuations in annual investment returns*
This option has a moderate to high probability of experiencing fluctuations in investment returns in any one year.
| Year Ended | Gross investment return % | Less tax on investment return % | Net earning rate % |
|---|---|---|---|
| 30 June 2005 | 12.11 | 1.48 | 10.63 |
| 30 June 2006 | 14.32 | 1.57 | 12.75 |
| 30 June 2007 | 14.99 | 1.46 | 13.53 |
| 30 June 2008 | -5.18 | -0.74 | -4.44 |
| 30 June 2009 | -12.17 | -1.51 | -10.66 |
| Equities % | |
|---|---|
| Listed shares | |
| Australian | 17.3 |
| International (partly hedged) | 33.5 |
| Emerging markets | 2.2 |
| Private equity | 4.8 |
| Cash % | 5.0 |
| Fixed Interest % | |
| Australian | 7.1 |
| International (fully hedged) | 11.9 |
| Property % | |
| Commercial property | 7.2 |
| Infrastructure | 7.6 |
| Ecosystem services | 3.4 |
The benchmark asset allocation and investment objective for this option changed on 1 July 2002 and 1 July 2005. Performance shown is based on the asset allocation applicable at the time. Past performance is not a reliable indicator of future performance. Objectives are what VicSuper aims to achieve for each investment option; they're not predictions or forecasts of likely returns.
* The higher the likelihood of fluctuations in annual investment returns, the greater the likelihood of negative returns.