Rest’s Growth option posts “strong” calendar year returns

Industry superannuation fund, Rest, has reported “strong” double-digit returns for its Growth investment product range for the 2024 calendar year.

The fund’s default MySuper Growth option generated returns of 11.19 per cent for the 2024 calendar year, marking its second consecutive calendar year with positive returns mostly attributed to the outperformance of international equities.

Rest’s High Growth and Sustainable Growth products also reaped the rewards from share market performance with returns of 14.09 per cent and 14.08 per cent respectively in the 2024 calendar year.

“Global share markets were stand-out performers – especially the US – during the past year. With several central banks moving to ease monetary policy and markets responding positively, we anticipate this should continue in 2025,” Rest’s interim Co-Chief Investment Officer, Kiran Singh, said.

“Equity valuations are elevated but, for now, they are supported by continued economic resilience and earnings growth. Inflation is coming down in major developed economies and employment is generally softening. We expect central banks will continue to ease rates. We will watch policy uncertainty in the US closely, but we broadly expect outcomes to be market friendly.

“Of course, upside surprises to inflation and inflation expectations risk negatively impacting rate trajectories should they arise. However, we firmly believe that being selective and focusing investment into assets with good fundamentals – strong balance sheets and stable and consistent earnings – are expected to support the continued generation of strong returns for members.

“I’m thrilled with the overall returns we’ve delivered to our 2 million Rest members during the past 12 months. Strong investment returns over the short-term help support our long-term investment goals. We continue to focus on a much longer time-horizon than a single year, with most of our members many decades from retirement.”

Rest’s interim Co-Chief Investment Officer, Simon Esposito, also confirmed the fund’s strategy will continue to track the five long-term megatrends expected to influence society and markets the most, including decarbonisation, deglobalisation, demographics, digitalisation, and debt and central bank policy.

“The 5 megatrends are informing our scenario modelling for future market expectations. Thanks to the influence of these megatrends, we believe investors won’t be able to just rely on a uniform increase in valuations across all assets, but will need to be more selective to be successful,” he said.

“We continue to seek investment opportunities that are well-placed to benefit from these megatrends, and add to those we’ve secured recently.

“For example, our $1 billion commitment to Quinbrook Infrastructure Partners, which will give us exposure to sustainable, hyper-scale data centres in the US and Queensland, is one way Rest can contribute long-term financial benefits to our members in an increasingly digitalised world.

“Similarly, we believe the onshoring and diversification of supply chains thanks to deglobalisation is generating valuable investment opportunities in industrial property. We have expanded our industrial property venture with Barings over the past year and now jointly hold a portfolio of around 475,000 square metres of leasable industrial space in prime locations across Sydney and Melbourne.”