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Cash allocation fall debunks SMSF myths

Sep 12, 2018, 09:41 AM

The allocation to cash in SMSFs shows a significant decrease following the massive spike in cash contributions to super funds during the last quarter of the 2017 financial year.

Cash and short term deposits dropped from 19.8% to 17.3% from June 30 2017 to June 30 2018, according to an upcoming SuperConcepts survey of 2600 SMSF funds with assets of $3.6 billion.

“It tells us that changes to the contribution rules saw many trustees use their last opportunity to make large non-concessional contributions to superannuation,” says Phil LaGreca, SuperConcepts Executive Manager of SMSF Technical and Strategic Services.

“These monies were then mainly invested in the Australian Equities sector.

“When stripping out performance, the cash allocation to Australian Equities increased by 1.5% due to investment from these cash amounts.

“This really debunks the myth that SMSFs just put money in the bank and leave it there because we now have clear data showing they are active investors.

“The data confirms that SMSFs are drawn to wanting control over their investment strategies and they are highly engaged in putting their money where they want it,” says Mr LaGreca.

SuperConcepts undertakes a quarterly analysis of its SMSF client investments to get a closer insight into how SMSF trustees invest and to identify emerging investment trends.

The survey covers 2,600 funds, a sample of the SMSFs SuperConcepts administers and the investments they held at 30 June 2018.

Funds are administered on a daily basis which ensures data is based on actual investments and is completely up to date. The assets of the funds surveyed represent around $3.2 billion.

The full report is expected in coming weeks.

Media contact:
Garth Montgomery
0408 864 851