Investment update – December 2009
The second half of 2009 has seen improving share market performance both in Australia and overseas.
For members invested in the Fund's Balanced and Equity Plus options, the turnaround in investment markets has resulted in positive crediting rates for the period 1 July 2009 to 30 November 2009, due to these options’ significant exposure to growth assets including Australian and International shares. The Cash Plus option also produced a positive crediting rate during this period.
Moving on from a tumultuous period
September 2009 marked the one year anniversary of the collapse of US investment giant Lehman Brothers, the largest corporate bankruptcy in history. This event is generally taken as a marker of the beginning of what was one of the worst financial crises since the Great Depression of the 1930s. However, unprecedented government spending – including the Rudd Government’s $42 billion stimulus package – and the lowering of interest rates by central banks helped stabilise financial markets, restored confidence in the banking sector and helped moderate the effects of the Global Financial Crisis.
Since the first signs of share markets recovery emerged in March 2009, there has been a sustained recovery in many parts of the world. Investor confidence has gradually improved as global economic data paints a more positive picture for growth and inflationary pressures remain subdued.
Fortunately, the Australian economy seems to have weathered the financial crisis better than many other western economies.
Not out of the woods just yet
While investment markets have started the new financial year positively, volatility in share markets in October shows that a further downturn remains a possibility.
A main area of concern is the uncertainty surrounding the way governments and central banks will choose to wind down their stimulus efforts and the effect of this removal of financial support. For the share market rally to continue, there will need to be strong signs of sustainable economic recovery.
Our investment strategy going forward
With still some uncertainty around the potential for a sustainable recovery, the Fund is taking a measured approach with our investments and is looking for investment opportunities as they arise. We will continue to keep you informed of developments in the performance of the Fund’s investment options.
Important information: This information is of a general nature only, and is not a comprehensive study. It has been prepared without taking account of any of your objectives, financial situation or needs. Before acting on the information, you should consider its appropriateness having regard to your objectives, financial situation and needs. You may wish to consult a licensed financial adviser when doing this. A copy of the current TWUSUPER Product Disclosure Statement should be obtained from us and considered carefully before you make any decision about whether to acquire the product or continue to hold our products. Issued by TWU Nominees Pty Ltd, ABN 67 002 835 412, AFSL No 239163 as the trustee of TWUSUPER (ABN 77 343 563 307).