Investment Option – Moderate

This option invests at least 95% of funds according to the target asset allocation of 70% in growth assets and 30% in defensive assets and the remainder towards the MVP approach

 

Investment objective (after fees and taxes over rolling 10-year periods)

To outperform the annual rate of inflation (CPI) by around 2.5% pa

 

Suitability

Most suitable for members who are willing to accept a medium risk of a negative return in any one year

 

Minimum suggested investment timeframe

Normally five years or more

 

Standard Risk Measure

Risk Band:   4
Risk Label:   Medium

 

Risk versus return

This option has significant emphasis on growth assets with the aim of achieving higher returns, together with some lower-risk defensive assets to reduce the short-term risks associated with growth assets and the MVP approach to manage extreme volatility. It offers a balance between expected long-term returns and the risk of a negative return in any one year. A negative annual return is anticipated on average 2-3 times every 20 years but negative returns may be more or less frequent.

 

Target Asset Allocation *

*The target allocation reflects 4% allocated to the MVP approach through the overlay. With the MVP approach embedded into the investment strategy, asset allocations will vary from time to time based on market conditions.