QSuper best performer over decade as bonds pay off

Queensland’s QSuper was not only the nation’s best superannuation performer over the past year, it has also taken out the title for the best performer over the past decade.

QUEENSLAND’S QSuper has scored another win, emerging as the nation’s best superannuation performer over the past decade as it defied volatile times by investing in bonds and unlisted assets.

SuperRatings yesterday named QSuper’s balanced fund as the top performer in the 10 years to the end of December, returning 8.6 per cent annually. Another home-grown fund Sunsuper also performed solidly over the decade with a return of 8.1 per cent per annum.

Last week research firm Chant West revealed QSuper Balanced was the top performing super fund for 2018. SuperRatings yesterday also placed QSuper at the top of the annual chart with a 2.6 per cent return. SuperRatings executive director Kirby Rappell said funds focused on investments in infrastructure, bonds and property had topped the performance charts.

Mr Rappell said QSuper’s long-term decision to invest in sovereign bonds, such as US Treasurys, was now paying consistent dividends.

“They made a decision a while ago to differentiate their investment strategy,” said Mr Rappell. “Going forward the performance of super funds is likely to diverge so it has never been a better time to regularly check your balances.”

QSuper chief investment officer Brad Holzberger said the fund, which manages $72 billion, had maintained the same investment strategy since the Global Financial Crisis of 2008.

This meant a smaller allocation to stocks and a greater allocation to sovereign bonds and unlisted assets such as property and infrastructure.

“The reason we have this strategy is that it is hard to predict what is going to happen in the future,” said Mr Holzberger. “Few funds have any holdings in bonds, making our strategy controversial but it has been very successful.

“The world is getting more uncertain economically and that is why we are not going to change our investment strategy. Developed countries are heavily indebted and interest rates are at all-time lows. The levers to support growth are not there.”

Sunsuper chief economist Brian Parker said the $58 billion funds’ focus on unlisted property and infrastructure assets including roads, airports and energy facilities would continue amid volatile times on global markets.

“When you have a look at where you are going to get the best return it is in those unlisted assets,” said Mr Parker, adding that superannuation funds were never going to be immune to the ups and downs of the stock market.

He said global uncertainty would continue in the face of global trade tensions, Brexit and the US government shut down.