Confirmed: Industry funds have highest unlisted weightings
The analysis, conducted by Frontier Investment Consulting, makes clear that when it comes to unlisted investments, industry superannuation funds have set the pace, notwithstanding the impact of the Your Future, Your Super legislation and the superannuation fund performance test.
According to a state of play analysis, as at 30 June 2022, APRA-regulated superannuation funds invested A$117 billion in unlisted real estate (5.6% of total assets), A$71 billion in Australian unlisted infrastructure (3.3% of total assets), A$57 billion in international unlisted infrastructure (2.7% of total assets), and A$110 billion in private equity (5.2% of total assets).
It said that while the Australian Prudential Regulation Authority (APRA) data does not specify the geographic exposure of unlisted real estate or private equity, but we would expect the majority of the unlisted real estate to be Australian. Private equity will vary from investor to investor but is typically weighted towards international private equity.”
“Industry funds have a much higher weighting to private markets compared to the overall APRA-regulated superannuation fund group. Industry funds invest A$70 billion in unlisted real estate (6.9% of total assets), A$54 billion in Australian unlisted infrastructure (5.3% of total assets), A$43 billion in international unlisted infrastructure (4.2% of total assets), and A$65 billion in private equity (6.4% of total assets),” the Frontier analysis said.
“Australian superannuation fund allocations to private markets falls behind global pension funds on private equity, are about equal on real estate and have much greater exposure to infrastructure,” it said. “This reflects the very early adoption of infrastructure as an asset class by Australian institutional investors relative to their global counterparts, as well as the regulatory environment which makes it more difficult to invest in sectors such as private equity.”
“Additionally, the industry fund sector has a higher exposure to infrastructure and real estate than the total superannuation sector due to it traditionally being more supportive of private assets and having a higher tolerance for illiquidity.”
Industry Funds love unlisted assets so they can value them whenever & however they want.
And of course the ISA Fund trustees love the option, that they have used, to sell out their own holdings via their inside information before an unlisted asset value down.
Why wouldn’t they love’m.
And ASIC turns a blind eye to the illegal activity of their best mates.