What happened over the financial year?
Markets started the 2020 financial year on a strong note. But when Coronavirus forced the world into lockdown and rapidly slowed economic activity, investments experienced unprecedented volatility.
After reaching all-time highs, many markets then delivered deeply negative returns as a result of Coronavirus, more recently however, markets recovered strongly despite poor economic data, a surge in Coronavirus cases and escalating political tensions.
As countries began restarting economic activity, and as governments and central banks continued to support conditions, confidence slowly returned to markets – as reflected in positive returns towards the end of the financial year.
Over the full year, returns for Australian share markets declined by 8% while global shares delivered a small positive return of 1%. Falling interest rates over the year meant fixed interest returned 6% to members.
If the fluctuations in markets over the last year have reinforced anything, it’s that superannuation does require a longer-term view and that markets do recover.
But when markets are volatile, it’s natural to feel concerned. For members considering making changes to their financial plan, it may help to speak with a financial adviser.
Looking ahead, we anticipate volatility will continue as conditions make a slow but steady recovery. In the meantime, we’re communicating closely with our skilled investment managers to learn more about the risks and opportunities for investing.
As always, we’d like to thank you for your continued support.