Market Update – October 2018

As reported in the news, global markets became jittery during October 2018. This has been caused by a number of drivers including:

  • Fears that corporate earnings growth have reached their peak,
  • Increased trade tensions, particularly between the US and China, and
  • A number of interest rate increases, led by the US Fed.

These concerns have led to a significant increase in volatility. Moreover, economic growth has become less globally consistent and less robust than in 2017, with economic activity accelerating in the US, moderating in the eurozone, UK and Japan, and slowing in China and other emerging markets.

The investment performance of a number of major asset classes have all experienced difficulties in the past month and indeed during the start of the financial year, as outlined below:

Month to Date
(as at close of 25 October)
Financial Year to Date
(as at close of 25 October)
Listed Equities MSCI ACWI -8.341% -3.769%
Fixed Income Global Agg -0.578% -1.497%
Exchange Rate USD/AUD -1.500% -3.540%

Christian Super’s Defensive Position

Christian Super has been defensively positioned over the course of 2018. Despite recent events we retain a cautiously optimistic outlook with focus on superior quality investments.

This does not mean that we will not be affected by downward market movements. However, we believe our defensive investment strategy is well positioned to protect against significant downward movements. For example, we:

  • Underweight Equities
  • Underweight Fixed Income
  • Underweight the US market
  • Underweight the global IT sector
  • Overweight Alternative and Impact assets
  • Ensure a structured portfolio construction across all asset classes, with seasoned and skilful managers in place

Our experienced investment team will continue monitor the market conditions closely, and will consider putting in place other performance or risk oriented strategies if necessary, to ensure we continue to deliver long term value to members.

– The Christian Super Investment Team

General Disclaimer The content of this article includes advice that is general in nature and does not consider your personal situation. Christian Super encourages all people considering their options in retirement planning to seek out qualified professionals who can provide specific personal advice.