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What are the main

What are the main

asset classes?

asset classes?

 

An asset class is a type of investment. The main asset classes that people refer to are shares, property, infrastructure, fixed interest and cash.

The reason why it's so important to understand asset classes is because they each have different levels of risk and return – the main criteria by which investors generally choose what they invest in.

Understanding what to expect from the different asset classes will help you decide which types of investments best suit your needs and investment timeframe.



Asset classes

Shares

What are shares, and how do they work?

Infrastructure

What are infrastructure investments, and how do they work?

Fixed interest

What are fixed interest investments, and how do they work?

Property

What are property investments, and how do they work?

Cash

What are cash investments, and how do they work?

The importance of diversification

Most members have a mix of assets in their super. This is important because each type of asset responds differently to market fluctuations – for example when share market are down, fixed interest investments may be up. Diversifying how your money is invested is an important strategy for managing volatility in your portfolio. It will help soften the impact of falls in individual markets and make your super less reliant on the performance of one particular asset class.

 

You can check how your super is invested by logging on to FirstNet or the Colonial First State app, or by checking your statement. If you want to change the amount of diversification in your super portfolio, we recommend speaking to your financial adviser first.

  • To help your super grow, your super fund invests your money into a portfolio of assets – such as growth assets like shares and property, or more defensive assets like cash and fixed interest.
    Depending on conditions in financial markets, all investments will perform differently. But by diversifying your super fund investments, you can avoid putting all your eggs in one basket – meaning, you can generate investment returns from different assets and help protect your super balance when financial markets fluctuate over time.
    Wherever you stand on investments and super, we’re here to help you get to where you need to be. Click through for a more detailed explanation of diversification and why it can be important in an investment portfolio.

Disclaimer

Information on this webpage is provided by Avanteos Investments Limited ABN 20 096 259 979, AFSL 245531 (AIL) and Colonial First State Investments Limited ABN 98 002 348 352, AFSL 232468 (CFSIL). It may include general advice but does not consider your individual objectives, financial situation, needs or tax circumstances. You can find the Target Market Determinations (TMD) for our financial products at www.cfs.com.au/tmd, which include a description of who a financial product might suit. You should read the Financial Services Guide (FSG) available online for information about our services. This information is based on current requirements and laws as at the date of publication.

Tax considerations are general and based on present tax laws and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information.

AIL and CFSIL are not registered tax (financial) advisers under the Tax Agent Services Act 2009 and you should seek tax advice from a registered tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise under a tax law.