Hello again, I’m Graeme Miller, Chief Investment Officer at TelstraSuper.  

In this video, I’ll update you on the performance of TelstraSuper’s investment options in the final three months of 2024 and provide a summary of how your super performed for the full calendar year.

I’ll also talk about the outlook for 2025 and how our investment portfolios are currently positioned.

And finally, I’ll let you know about an interesting new investment we are in the process of completing. 

[DISPLAY QUARTERLY ACCUMULATION RETURN SLIDE ON SCREEN]

But let’s start with the performance of your super in the last three months of 2024.

The chart on the screen shows the performance of TelstraSuper’s investment options for our accumulation members for this three month period.  These returns are net of all investment taxes and investment fees.  

You can see that it was a solid quarter of performance for all our diversified investment options.  

The High Growth investment option earned almost 4%, the Growth option delivered 2.6%, the Balanced option earned 2.1%. and the Moderate and Conservative options delivered 1.6% and 1.1% respectively.

But the best performing option was the International Shares option which earned 9.2% in the three month period. In contrast, the performance of the Australian Shares option was slightly negative over the quarter.   

The strong performance of the International Shares option was mainly driven by a surge in the value of shares in the United States following the decisive election result in November 2024 and was further helped by a fall in the value of the Australian dollar over the period.  

[DISPLAY QUARTERLY PENSION RETURN SLIDE ON SCREEN]

And here are the returns for RetireAccess pension members for the same three-month period. You’ll see they’re similar to the returns for our accumulation members. The Lifestyle Growth Investment Option earned 2.5%, the Lifestyle Balanced option achieved 2.2%, the Lifestyle Moderate option earned 1.7% and the Lifestyle Conservative option earned 1.1%.  

But the good news doesn’t stop there.   

Let’s have a look at the returns for the full 12 month period to 31 December 2024:

[DISPLAY ANNAUL RETURN SLIDE ON SCREEN]

This slide shows performance of all our investment options over the full year, for both Accumulation as well as RetireAccess members.    

We’re delighted to share that all of our diversified investment options generally delivered pleasing returns for the full year. For example, if you’re an accumulation member in our High Growth option, your super will have grown by 15.4% for the year. If you were in our Growth option, your super balance would be 12.7% higher and those of you in our Balanced option earned 10.5% for the year.  

For the second year in a row, the International Shares option was the best performing option, increasing by more than 25% for the year. By contrast, the Property option, ended the year negative 2.5%.  Once again, property values were impacted by the lagged effect of higher interest rates and softening demand for office buildings.,

We see similar results for our RetireAccess members. Our Lifestyle investment options are designed to be less volatile than our Accumulation options, so they generally have lower allocations to shares than their accumulation counterparts. They also benefit from having no tax on their investment earnings. 

Looking back on 2024, there were three main drivers behind this positive investment performance.

Firstly, we continued to see economic growth in most parts of the world. Although some investors and market commentators began the year anticipating a looming recession in the US and other developed countries, unemployment remained low, economic activity remained strong, and recessions were mostly  avoided. 

Secondly, we saw interest rate reductions in a number of key economies including the United States, Europe and the UK.  All other things being equal, lower interest rates provide support for stronger investment returns.

Thirdly, share markets continued to be supported by the rapid development of Artificial Intelligence technology, which boosted the share prices of the major technology companies.   

Additionally, towards the end of the year, share markets responded positively to the US presidential election result, and the prospect of lighter regulation and lower taxes in the United States.

I’ll now talk briefly about what 2025 may have in store.  As is often the case, there is a range of different possibilities for how economies and investment markets may fare in 2025. The key things that we are monitoring are: 

First and foremost, we’re carefully watching what happens to inflation.   While inflation moderated over 2024, there are some signs that it may pick up again in both Australia and the US. Rising inflation would most likely have a negative impact on share prices, as the pace of interest rate reductions that are currently reflected in asset prices will slow down

We’re also keeping a close eye on the first few months of Donald Trump’s presidency. The incoming president has flagged an ambitious and wide-ranging program of new policies – but it’s not yet clear which of these will be prioritised and whether he’ll follow through on some of the more controversial policies he’s announced – such as increased tariffs and mass deportations.   

Finally, we’re watching consumer spending patterns. There is already some evidence that consumers are beginning to reduce their spending, as cost of living pressures begin to bite.  If consumer spending declines, this will slow down economic growth.

Against this backdrop, our asset allocation settings are currently close to their long-term strategic positions, reflecting a range of possible outcomes for economies and markets without a strong preference for any particular scenario. As always, we’ll remain alert to both emerging opportunities and risks, and will adjust our portfolios accordingly.

To end this video, I’m pleased to let you know about a new investment in our infrastructure asset class, which was approved towards the end of 2024.   This new investment concerns the redevelopment of one of the terminals of John F Kennedy Airport in New York.   JFK Airport is one of the busiest in the world, with more than 60 million passengers travelling through the airport every year. Through our investment partner, we’ll be participating in the replacement of two aged terminals with a brand new state of the art facility, holding the right to collect landing and take-off charges from the new terminal until 2060. This is just one example of how we continue to grow and evolve our diversified investment portfolios.

I’d like to end by thanking you for entrusting us with your super savings.  It’s a responsibility we take very seriously. We look forward to navigating another year on your behalf.

Please remember past performance is not a reliable indicator of future performance. 

This presentation contains factual information and general advice only, including information about financial products. It has been prepared without taking into account your objectives, financial situation and needs. You should consider whether it is appropriate having regard to your personal circumstances before making any financial decisions. Before making any investment decision, you should obtain and read the relevant product disclosure statement which is available on the TelstraSuper’s Website or by calling 1300 033 166 between 8.30 am and 5.30 pm (AEST) Monday to Friday. You may wish to consult an adviser before you make any decisions relating to your financial affairs. To speak with an Adviser from TelstraSuper Financial Planning call 1300 033 166.

All returns displayed in this presentation are net of all applicable investment taxes and investment fees, but before the deduction of any applicable percentage-based administration fee, member fee or rebate.