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Asset classes


Property investments include office buildings, shopping centres and industrial estates, residential property such as apartment buildings and retirement villages, and property businesses. Investors can access property investments either directly or indirectly by purchasing units in a property trust (unlisted or listed) and the property investments may be in Australia or global.

Direct and unlisted property investment returns reflect a combination of rental income and capital growth, and are dependent on a range of economic factors such as interest rates and employment, as well as the location and quality of properties.

Listed property investments (often known as Real Estate Investment Trusts or REITs) are investments in their own right and like shares, their returns also reflect general market sentiment. Returns from listed property securities are therefore different (and more volatile) than the returns earned from owning direct or unlisted property investments.

Property investments are subject to a moderate to high degree of risk and are typically most suitable for long-term investors seeking high growth over the medium to long term, who are willing to accept fluctuations in returns and the possibility of negative returns over the short term.

Infrastructure and real assets

Infrastructure and real assets are the utilities and facilities that provide essential services to communities, and the entities that own or operate these utilities and facilities. Examples include utilities (electricity, gas, water and communications), power (including renewables), transport (airports, seaports, toll roads and rail), social infrastructure assets (hospitals, education facilities, community infrastructure such as a convention centre) and agriculture (including land and water assets, as well as timber assets) and the entities that own or operate such assets.

We may also invest in new infrastructure sub-sectors which exhibit similar features to traditional infrastructure investments, for example land title registries, and infrastructure businesses that own and operate infrastructure assets.

Infrastructure investments can be accessed either directly or indirectly by acquiring an interest in an unlisted or listed infrastructure investment or business.

Because they often require substantial upfront investment, unlisted infrastructure investments typically have high barriers to entry, but generally offer investors a steady income stream, potential for capital growth over the long term, and lower volatility than other growth assets such as equities. However, there are risks. For example, changes to government regulations, usage rates, and interest rates may affect their value.

By contrast, listed infrastructure investments are investments in their own right and like shares, their returns also reflect general market sentiment. Returns from listed infrastructure securities are therefore different (and more volatile) than the returns from owning direct or unlisted infrastructure investments.

Liquid alternatives

Liquid alternatives include a range of non-traditional strategies such as real return strategies and hedge funds. Unlike traditional fund managers, which are often restricted to investing in a single asset class (e.g. Australian equities), managers of these strategies have a wider range of allowable investments and are able to utilise a combination of equities, bonds, currencies, commodities and other liquid asset classes. They can make investments in these asset classes via physical exposures or, more typically, via derivatives.

The managers we partner with to manage this asset class are selected for their potential to provide strong diversification, or to deliver returns above CPI (or an official cash rate) by dynamically moving around their exposure to different asset classes.

We differentiate between growth-oriented and more defensively-oriented liquid alternatives strategies. The growth-oriented strategies are focused on generating strong capital growth but can also carry a high level of risk. By contrast, the defensively-oriented strategies aim to reduce total portfolio risk by providing positive returns when equity markets experience large negative returns.


Cash investments include a range of short and medium-term interest-bearing investments, such as term deposits, bank bills and treasury notes. For the diversified investment options, the Cash asset class can also include corporate debt and asset-backed securities which aim to add value while substantially retaining the low-risk characteristics of more traditional cash investments.

Typically the least risky of all asset classes, cash is often chosen by investors who want to access their money in the short to medium term. However, while the risk of negative returns from cash investments is much lower than for other asset classes, expected returns are also lower, particularly in a low interest rate environment. The buying power of your money may also be reduced as it may not keep up with inflation. The value of a cash investment can fluctuate due to a number of factors, but primarily with the rise and fall in interest rates.