Investment returns (before tax and fees) for the quarter ending 30 June 2022 are:

Fund 3 months 1 Year (p.a.) 3 years (p.a.) 5 years (p.a.) 10 years (p.a.)
Growth Fund -5.1% -1.0% 7.0% 8.3% 8.5%
Balanced Fund -4.4% -2.3% 4.7% 6.1% 6.9%
Income Fund -2.6% -4.6% 0.2% 1.5% 2.8%

Are we closer to an upward move in markets? Most major share markets fell, (between 10% and 20%), and bond (fixed income) markets fell (between 1% and 6%), in the quarter.

Market participants continue to fret about the outlook for inflation and growth. Many central banks around the world have begun (or are expected to) to raise their official cash interest rates. They continue to indicate that they will keep raising rates until they feel they have inflation expectations under control. Markets are concerned that central banks may raise interest rates too far and or too fast. This raising of rates will have an impact on economic growth. Some fear that the raising of rates could result in a recession, which is known technically as two consecutive quarters of negative growth. However some also think that central banks may not be far from finishing raising rates. They point to signs of a slowdown in economic activity and that inflation expectations are under control, and therefore growth may not be as negatively impacted as expected i.e. we are past the worst and the markets may be guilty of over-pricing in negative outcomes.

We remain cautiously invested, diversified and continue hold higher than normal amounts in cash. This is our defensive approach to the current situation.