Investments update
January to March 2023
Mercer Super members experienced positive returns for the first quarter of 2023.
Read more and download the full report below.
Super performance
The first quarter of 2023 was a period of positive performance across all of our investment options. For the majority of Mercer Super members this performance has led to a boost in their super balances – helping to secure their financial future.
Mercer SmartPath®
Our default investment option, Mercer SmartPath® delivered positive returns for the first quarter of 2023, with returns ranging between 3.2% to 4.1%.
It was pleasing to see a significant number of Mercer Super members experiencing above median returns, with the industry median for default investment options returning 3.9% for the quarter.1
Additionally, over the longer term we are proud to confirm our investment performance remains strong, with all Mercer SmartPath® options continuing to comfortably enjoy above median returns across all time periods.1 Moreover, almost three-quarters of Mercer SmartPath® members continue to benefit from top quartile investment performance over 1, 3, 5 and 7 years.2
Ready-made and Sustainable Plus investment options
The first quarter of 2023 saw our diversified ready-made investment options generate positive returns, with members invested in these choice options continuing to benefit from above median returns for 1, 3, 5 and 7 years.3 Our Sustainable Plus investment options also performed well for the quarter, achieving a range of 3.0% to 4.3% for the period.
Investment market update
Global markets
The first quarter of 2023 began on a positive note in January followed by mixed results through February and March.
Inflation continued to fall, seemingly having peaked in most developed countries. The focus firmly remains on how much more monetary tightening we will see, or if central banks will begin to pause and assess the flow on impacts on the economy.
Australian markets
Australian shares were positive over the first quarter of 2023 as the S&P/ASX 300 Index returned 3.3% for the period.
In fixed income, we saw decreases in the Australian 10-year bond yield (-0.76% to 3.30%), five-year bond yield (-0.67% to 3.03%) and two-year bond yield (-0.34% to 3.08%), leading to returns being broadly positive over the quarter.
How we look after your super
We appreciate that investment markets can be complex and our members often wonder how we work to grow their investment, and where necessary protect their super. To help explain how we do this we’ve referred to Mercer Pacific’s Chief Investment Officer, Kylie Willment, who has provided a simple overview:
When setting investment strategies, we make assumptions on forward looking risk and return expectations based on a base case set of expectations and look at the range of uncertainty around those expectations.
We need to be a bit humble and acknowledge that we don’t have a crystal ball, so to manage this, we put a lot of focus on diversification. It is one of your best defences against uncertainty.
We’ve built a lot of diversification into the portfolios – we invest in a broad and deep set of asset classes across both public and private markets, we use underlying investment managers across a range of styles and we have strong geographical and sector diversification so that, ultimately, we are not putting all your eggs in one basket, and we know there will be components of the portfolio that should do well in different market environments.
We also need to stay very vigilant because market conditions can change quickly and that can provide both increased risk but also increased opportunity.
So where possible, we take an active and dynamic approach so that we, and the underlying investment managers that we employ on your behalf, can take advantage of the changing market opportunity set.
Related readings:
Previous performance reports:
2022 Quarter 4: October to December
2022 Quarter 3: July to September
2022 Quarter 2: April to June
2022 Quarter 1: January to March
Read next:
Annual Reports
Each year we publish a Mercer Super Trust Annual Report which contains important information about our fund, any changes that we’ve made, our investment options and performance plus much more.
How your super is invested
Find out what underlying assets your super or allocated pension is invested in.
Care & Living with Mercer
Care & Living with Mercer is here to help Mercer Super members and their loved ones with ageing care needs.
1. Mercer Super Trust’s analysis of Mercer SmartPath, compared to the median of all default funds reported in SuperRatings Fund Crediting Rate Survey – Default Options as at 31 March 2023.
2. Mercer Super Trust’s analysis of Mercer SmartPath (born 1974-1978), compared to the median of all default funds reported in SuperRatings Fund Crediting Rate Survey – Default Options as at 31 March 2023.
3. Mercer Super Trust’s analysis of Mercer Ready-made Investment Options, compared to its respective growth asset ratio fund survey’s median as reported in SuperRatings Fund Crediting Rate Survey as at 31 March 2023.
Disclaimer: This content has been prepared on behalf of Mercer Superannuation (Australia) Limited (‘Mercer Super’), ABN 79 004 717 533, Australian Financial Services Licence #235906, the trustee of the Mercer Super Trust ABN 19 905 422 981. Any advice is of a general nature only, and does not take into account the personal needs and circumstances of any particular individual. Prior to acting on any information, you need to take into account your own financial circumstances. Please consider the Product Disclosure Statement, Product Guide, Insurance Guide, and Financial Services Guide before making a decision about the product, or seek professional advice from a licensed, or appropriately authorised financial adviser if you are unsure of what action to take. Past performance is not a reliable indicator of future performance. 'MERCER' is a registered trademark of Mercer (Australia) Pty Ltd ABN 32 005 315 917.
Mercer Super has been recognised with several SuperRatings awards, including SuperRatings' highest platinum rating for our Corporate Superannuation Division product. The Corporate Superannuation Division product also received SuperRatings 15 Year Platinum Performance award, based on investment returns, fees, insurance, member servicing, administration and governance. The rating is issued by SuperRatings Pty Ltd (SuperRatings) ABN: 95 100 192 283 a Corporate Authorised Representative (CAR No.1309956) of Lonsec Research Pty Ltd ABN 11 151 658 561, AFSL No. 421445 (Lonsec Research). Ratings are general advice only and have been prepared without taking account of your objectives, financial situation or needs. Consider your personal circumstances, read the product disclosure statement and seek independent financial advice before investing. The rating is not a recommendation to purchase, sell or hold any product. Past performance information is not indicative of future performance. Ratings are subject to change without notice and SuperRatings assumes no obligation to update. SuperRatings uses objective criteria and receives a fee for publishing awards. Visit superratings.com.au for ratings information and to access the full report. © 2024 SuperRatings. All rights reserved.