The probability of Australia falling into a recession has increased and markets are set for a period of heightened volatility, says Aware Super’s Damian Graham.
Mr Graham said he expected the fund to pass the second annual super fund performance test in August, even though the fund delivered negative returns to its members in the last financial year.
Describing a recession as just one potential outcome for the global economy, Mr Graham expects volatility to be heightened over the next six months as companies grapple with interest rate rises. About one-quarter of the fund’s investments are in unlisted assets like infrastructure, property and private equity.
Its high-growth option, which is popular with young members, fell by 3.5 per cent over the past financial year, compared to the median high-growth fund which delivered a -4.1 per cent return, according to data from SuperRatings.Despite the fund’s performance in the past 12 months, Mr Graham said Aware Super was “well positioned” to pass the performance test, the results of which will be released in August.
Mr Graham said he supported the government’s decision to review the test, which he said disadvantaged ethical investment options that excluded investments in sectors like resources.
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