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Crystal Wealth Newsroom

Why your next investment strategy should be ‘responsible’

Investments Service

When deciding on a new investment strategy or wanting to update a current investment strategy, consider a responsible investment portfolio.

There is substantial academic evidence and research in Australia, New Zealand and internationally to support the argument that responsible investing performs are on par with, if not better than, the broader investment market.

A 2020 study by the Responsible Investment Association Australasia (RIAA), found that the Responsible Investment Australian share funds surveyed outperformed mainstream Australian share fund benchmarks for all periods, for the period to 31 December 2019.

 

Australia share funds 1 year 3 years 5 years 10 years
Average responsible investment fund (between 17 and 48 funds sampled depending on time period) 24.7% 11.3% 10.1% 9.0%
Morningstar: Australia Fund Equity Large Blend* 22.3% 9.0% 7.8% 6.8%
S&P/ASX 300 Total Return 23.8% 10.3% 9.1% 7.8%

* Source Morningstar Direct

 

Additionally, research group Rainmaker compared the median performance of the top 50 workplace superannuation ESG options offered to Australian investors versus the SelectingSuper Growth and Balanced indices.

The following table compares the median rates of return of the top 50 Australian retail and industry superannuation ESG investment options versus the SelectingSuper Growth and Balanced funds over the last 10 years:

 

1 year 3 years 5 years 7 years 10 years
Top 50 retail and industry super ESG options 15.9% 9.5% 6.9% 8.7% 7.4%
SelectingSuper Growth Index 16.7% 10.0% 7.9% 9.7% 8.5%
SelectingSuper Balanced Index 13.5% 8.3% 6.7% 8.1% 7.5%

* Source: Rainmaker Information, publisher of the SelectingSuper superannuation comparison service, data to 31 January 2020

 

While this research supports the argument there can be no guarantees that this will occur in the future.

If you are considering changing your current investment strategy or would like to start a new investment strategy that focuses on responsible investments, contact one of our advisors now on the ‘contact us’ page.

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