Monthly investment performance update
Fund Performance for August 2005
Welcome to the monthly update on your Fund's investment portfolios.
The PSS Board's primary responsibility is the management and investment of the Fund in the equitable and best interests of all members. The Board approaches this task by setting investment objectives for the Fund's investment options that maximise the real investment returns earned subject to tolerable levels of short-term volatility for each option.
Table 1: Asset allocations for pre-mixed investment options as at end August 2005 (% )
This table shows the actual asset allocations of the four pre-mixed investment options. The other seven options are essentially single strategy options - see our product disclosure statement .
Asset Class |
Conservative |
Balanced 50/50 |
Trustee Choice |
Aggressive |
Cash |
30 |
12 |
12 |
2 |
Bonds/Fixed interest |
40 |
28 |
8 |
0 |
Market neutral strategies |
0 |
10 |
10 |
8 |
Total Defensive Assets |
69 |
50 |
30 |
10 |
Australian shares |
15 |
17 |
30 |
40 |
International shares |
12 |
18 |
25 |
35 |
Property |
3 |
10 |
10 |
10 |
Long/Short equities |
0 |
5 |
5 |
5 |
Total Growth Assets |
31 |
50 |
70 |
90 |
Total |
100 |
100 |
100 |
100 |
Table 2: Performance in 2005-06 as at end August 2005 (%)
The figures in the table are after taxes and fees and show the return for a member who was invested for the whole month in each option.
Investment Option |
July |
August |
Financial Year to End-August |
Conservative |
0.8 |
0.7 |
1.5 |
Balanced (50/50) |
1.2 |
0.7 |
2.0 |
Trustee Choice |
2.3 |
1.2 |
3.5 |
Aggressive |
2.4 |
0.7 |
3.1 |
Cash |
0.4 |
0.4 |
0.7 |
Bonds/Fixed interest |
-0.1 |
0.7 |
0.6 |
Australian shares |
2.5 |
1.9 |
4.4 |
International shares (unhedged) |
3.5 |
1.0 |
4.5 |
International shares (hedged) |
3.4 |
-0.2 |
3.2 |
Property |
0.4 |
-0.1 |
0.3 |
Sustainable |
-0.1 |
-0.1 |
-0.1 |
Commentary:
Equity markets outside the US have opened the new financial year on a very firm note with all the major markets up in the first two months of the year. The US market had a strong July but fell back in August as lacklustre economic releases and concerns over rising fuel costs weighed on investors. The devastation of Hurricane Katrina at the end of the month added to concerns. The Australian equity market continued to climb and by the end of August was nearly 80% above its February 2003 lows.
Bond markets bounced back in August from their subdued start to the year on the back of some early thoughts that the impact of Hurricane Katrina on the US economy might slow the expected rise in US interest rates.
The Fund's market neutral and long/short managers have delivered solid returns in the first two months of the year with both groups around 1% ahead of their respective benchmarks over this period.
André Morony
Chief Investment Officer
13 October 2005
