The three most popular investment classes for SMSF trustees are: cash and term deposits, listed shares and self-managed assets and direct property, according to trend statistics monitored by OneVue.

As at March 2015, these three asset categories represented about two-thirds or 69.50 percent of all of OneVue’s SMSF investments under management.

Cash and term deposits represent about 20.27 percent of the investment mix, compared to 21.56 percent in March 2014 and 26.52 percent in March 2013.  Listed shares hold about 26.42 percent, compared to 27.75 percent in March 2014 and 30.08 percent in March 2013. Direct property holds about nine percent, compared to six percent in March 2014 and four percent in March 2013.

Direct property is showing the largest percentage jump with it increasing more than 53 percent from 4.38 percent in March 2013 to 9.37 percent to March 2015.  While cash and term deposits have declined about 31 percent during the same period, from nearly 27 percent in 2013 to just over 20 percent in 2015.

However, while there has been a jump in direct property investment, it still remains a relatively small proportion of total investments representing less than 10 percent of the investment mix.

OneVue’s Head of Strategic Relationships, Mr Alex Wise, said there is a trend that investors are moving into riskier asset classes to balance falling yields on traditional investment selections.
“Currently cash rates are reaching historic lows and there is a significant upward trend in direct property investment driven by low mortgage rates.  However, loans in the investment mix are falling, raising questions about whether investors are leveraging their property acquisitions through their borrowings,” he said.

“Property requires a long-term horizon to generate a return: about 10 years, but decades are better.  This is why property remains a relatively small proportion of the overall investment portfolios but the trend now is that it is growing with valuations exacerbated by the housing bubble in Sydney and Melbourne.

“There is a noteworthy trend is the increase in investments in unit trust which have increased from 12.22 percent to 23.09 percent in the 12 months to March 2015, showing managed schemes are being increasingly favoured by investors,” Mr Wise said.

As a middle to back-office service provider to the superannuation and wealth management industry, OneVue works with advisers to build and deliver tailored systems needed to best service investors.

For further information, please contact:

Ric Purcell
Newsroom Communications
02 8823 2539

Leave a Comment

Your email address will not be published. Required fields are marked *