Our investment strategy
We invest in a diversified portfolio of assets that balance investment returns and risks.
Our investment strategy is to build a diversified portfolio of assets that balances investment returns and risks. We achieve this by investing in a combination of growth assets and defensive assets.
The growth assets we invest in include shares, infrastructure and property. Returns from growth assets come mainly from capital gains and income in the form of dividends.
Growth assets generally offer the greatest potential for long-term growth but returns can fluctuate and may be negative from time to time.
The defensive assets we invest in include fixed interest and cash. The returns on defensive assets are mainly from interest earned.
Defensive assets generally offer less long-term growth than growth assets, but returns are generally more stable with a relatively low level of risk. Negative returns are possible in the case of fixed interest but cash returns are generally positive.
Public and private market investments
Within both growth and defensive components of the portfolio, the majority of our investments are in markets that are frequently traded, such as government bonds, or shares listed on public stock exchanges. We refer to these as listed or “public market” assets. These assets are easier to exit in most market conditions, but their value can be more volatile over shorter time horizons.
Some of our investments however, such as direct property and infrastructure assets or venture capital investments, are not listed on exchanges or readily traded in public markets. We refer to these as illiquid or “private market” investments. These investments can be harder to exit and typically require appraisal-based valuations.