AMP Capital reveals disconnect between SMSF objectives, assets

Self-managed superannuation fund (SMSF) trustees have high growth expectations for the next 12
months yet as many as 55 per cent have moved to a more defensive asset allocation amid continuing
market volatility, according to AMP Capital.
Statistics from AMP Capital’s latest Black Sky Report show that while SMSF trustees expect a 10.9 per
cent return on their portfolio this year (6 per cent capital and 4.9 per cent income), only 18 per cent of
trustees have made changes to position their portfolio for growth. This is, however, an increase of five
percentage points from 2015.
Further to this, nearly half of SMSF trustees surveyed for the report say their aim is to have a fully
diversified portfolio yet more than 50 per cent of their portfolio is invested in just one investment type
outside of managed funds.
AMP Capital Head of Self-Directed Wealth and SMSF Tim Keegan said: “If trustees continue to be
exposed to significant portfolio concentration risk and remain in more defensive assets without seeking
financial advice, they may struggle to achieve their retirement goals.”
AMP Capital’s Black Sky Report is developed each year to provide a snapshot of trustee investment
trends. It also helps to arm financial advisers with insight and knowledge of where SMSF trustees are
looking for specific advice.
The 2017 report has identified the biggest investment challenges for SMSF trustees as market volatility
(according to 18 per cent of trustees surveyed), investment selection (11 per cent) and regulatory
changes (10 per cent).
Mr Keegan said: “It’s clear that many SMSF trustees need help especially around portfolio construction
and understanding the regulatory changes that are coming into play. With nearly 60 per cent of SMSF
trustees remaining open to using the expertise of a financial adviser, it’s clear this is a huge opportunity
for advisers to tap into.”
The research also revealed that SMSF trustees continue to find managed funds attractive, with 47 per
cent each investing approximately $280,000 in them. Thirty per cent of SMSF trustees made their most
recent managed fund investment after receiving advice from their financial planner.
Mr Keegan said: “There is an increasing appetite among SMSF trustees to invest in Australian equity
funds, both active and passive. Advisers can be proactive in recommending high-quality unlisted
managed funds as well as introducing trustees to the increasing range of active exchange traded funds
that are now available on the market.”
Active ETFs replicate managed fund strategies but are able to be bought and sold during the trading day
like any share on the Australian Securities Exchange. AMP Capital, in alliance with BetaShares,
launched three active ETFs during 2016: the AMP Capital Dynamic Markets Fund, the AMP Capital
Global Property Securities Fund and the AMP Capital Global Infrastructure Securities Fund.
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According to Mr Keegan: “With expectations for growth at an all-time high, regulatory uncertainty at its
peak and new products such as active ETFs becoming increasingly popular, there is more need than ever
for SMSF investors to turn to financial advisers for support.”
For the third year in a row, AMP Capital has released the Black Sky Report, which uses research and
data from leading research house Investment Trends to uncover the latest SMSF investor trends and
insights.
The research is based on a quantitative online survey of nearly 800 AMP Capital SMSF investors
conducted by Investment Trends. The 2017 Black Sky Report can be downloaded here. http://www.ampcapital.com.au/smsf-suite/blacksky