How are super funds and Income accounts invested and why you need to know - BUSSQ

How are super funds and Income accounts invested and why you need to know

It is important that you take the time to understand the basics, as it will help you to determine your risk tolerance and your investment return expectations. It will put you in a better position to select the investment option or mix of investment options that are best suited to you.

Investing Your Money

An Investment Committee, appointed by the BUSSQ Trustee Board, makes recommendations to the Board about where BUSSQ’s money should be invested. The Investment Committee and the Board obtain professional investment advice from its investment consultant, Frontier Advisors. Assets are allocated within ranges set by the BUSSQ Board after consultation with its investment consultant. The Board reviews these ranges on a regular basis. Specialist investment managers are interviewed and selected for each of the asset classes. They are selected on a management and performance basis and they are required to report regularly to the Board. The investment managers are constantly monitored by the Trustee.

BUSSQ invests your savings across nine main types of investments or asset classes:

  • Shares (Australian and overseas)
  • Property (Australian)
  • Fixed interest (or bonds)
  • Cash
  • Infrastructure
  • Opportunistic Growth
  • Agriculture
  • Opportunistic debt, and
  • Derivatives

These asset classes are divided into two types – Growth assets and Defensive assets.

Growth Assets

Growth assets are more risky – but can deliver higher returns over the long-term. They include:


Companies listed on a stock exchange issue shares (also known as equities or stocks) to raise capital. You become a shareholder and part owner when you purchase shares in the company and that means you are entitled to any company profits (which are distributed as dividends). Company performance, industry conditions or movement in the share market can impact share prices.


Includes land and buildings that can be bought, sold or leased. Investing in property through a super fund lets you and other members pool money to enable you to part-own properties that would otherwise be too expensive for you to acquire on your own. For example, office buildings and shopping centres. Like shares, property is influenced by many factors including supply and demand and market conditions.

Defensive Assets

Defensive assets are less risky – therefore they can be used to protect your investment against loss. However, they generally deliver lower returns. They include:

Fixed Interest

When an investor lends money to governments, semi-government bodies and corporations, interest is paid at an agreed rate, which is fixed for the term of the loan. These investments are also known as bonds. Fixed Interest investments can be held until they mature or they can be traded at any time before maturity. If they are sold before maturity, the price will depend on the interest rate at the time. Returns from fixed interest investments occur from regular interest payments and any change in value caused by movements, either up or down, in interest rates. Fixed Interest is usually a more stable investment than shares, but can be affected by currency movement.


Investments in cash includes money invested in term deposits or bank bills and interest is earned on the cash invested. This is similar to having money in a bank account. Over the long term, cash is likely to produce the lowest return of all the main asset classes.

Overseas Investments

Investments in shares and fixed interest can be made in Australia or overseas. In fact, the Australian share market accounts for less than 2% of the world share markets. When investing overseas, returns can also be affected by changes in the value of the Australian dollar. These changes can enhance overseas returns (when the Australian dollar is falling) or detract from overseas returns (when the Australian dollar is rising).

Further details on how your money is invested can be found in the BUSSQ Annual Report. If you have any questions or would like further information, please contact one of our Superannuation Experts.