Our investment philosophy
When creating the investment options for Professional Super, we sat down with the investment experts at Activus Investment Advisors and asked;
“what’s the best evidence-based investment strategy for young people?”
The solution he came up with was three investment options which were created using index investing.
Index investing involves using technology to buy a little bit of many companies, in proportion to their share of the market or index. The alternative is active investing, which involves hiring a team of managers to pick which specific companies on the stock market (or other investments) will meet a set criteria e.g. perform better than others.
A number of long-term studies have shown that over time, index investing outperforms actively managed investments. A research project conducted by S&P Dow Jones Indices in 2016, found that around 90% of active managers didn’t beat the index (Bloomberg
). And, because you don’t need a team of stock pickers, it’s also lower cost.
At Professional Super, if your balance is above $1,500 it’s invested in a range of index funds managed by Macquarie.