Mercer Super default options achieve 11.2% return 

MELBOURNE, 18 July 2024

Mercer, a business of Marsh McLennan (NYSE: MMC) and a global leader in redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being, today announced that the Mercer SmartPath default investment options have returned between 11.2% and 11.7%^[1] for the 2023/24 financial year across age-based cohorts for members aged between 18 and 55.

Mercer’s Pacific Region Acting Chief Investment Officer Sue Wang said the results were an excellent outcome against a backdrop of market volatility and uncertain economic conditions.

“Equity markets enjoyed a very good year as inflationary pressures slowed. The US equity market was a particularly strong performer – up 24%^[2] for the year. Bond market returns were modest and returns for unlisted assets were varied – global infrastructure funds continued to enjoy strong returns, while returns for domestic property funds were weak overall.

“Our portfolio positioning, with a slight bias towards equity markets and underweight to private market assets such as unlisted property, has proven to be a benefit for members over the period,” Ms Wang said.

“We expect market volatility to remain high over the next 12 to 18 months against a backdrop of key elections. The global economic outlook, however, has improved as unemployment is expected to remain low and there is potential for interest rates to be lowered as inflation continues to moderate.

“As a result, we remain focused on maintaining the appropriate level of risk and diversification for our default investment options, supporting retirement outcomes now and in the future,” she said.

Mercer’s SmartPath is a lifecycle default product, which gradually reduces risk exposure as members age past 55 years. This seeks to shield superannuation savings from market volatility for those with a shorter-term outlook to retirement.

“Creating a default fund that takes an appropriate amount of investment risk based on the age of its members is one of the most important decisions a trustee can make in supporting the retirement outcomes of members,” said Tim Barber, Mercer Super’s CEO.  

^{[1] Based on the one-year return to 30 June 2024. Past performance should not be relied upon as an indicator of future performance.}

^{[2] S&P500 Net Total Return in USD, 30 June 2024}

This content has been prepared on behalf of Mercer Superannuation (Australia) Limited ABN 79 004 717 533, Australian Financial Services Licence #235906, the trustee of the Mercer Super Trust (‘Mercer Super’) ABN 19 905 422 981.

‘MERCER’ and SmartPath are an Australian registered trademark of Mercer ABN 32 005 315 917.

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. The material contained in this document is based on information received in good faith from sources within the market and on our understanding of legislation and government press releases at the date of publication which we believe to be reliable and accurate. Neither Mercer nor any of its related parties accepts any responsibility for any inaccuracy.

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.