Introduction
The Commonwealth Growth Fund, part of Commonwealth Bank Group Super, is designed for members seeking long-term capital growth. It primarily invests in growth-oriented assets such as Australian and international shares, property, and infrastructure, with a smaller allocation to defensive assets like fixed interest and cash. Understanding the fund’s asset allocation helps members assess risk, expected returns, and suitability for their retirement goals.
1. Australian Shares
- Investment Focus: Equities of large, mid, and small-cap Australian companies listed on the ASX.
- Objective: Capture capital growth from domestic market opportunities.
- Typical Allocation: ~35–40% of the fund.
Example:
- Fund size: $100,000
- Australian shares allocation: 100,000 \times 35% = 35,000
2. International Shares
- Investment Focus: Global equities from developed and emerging markets.
- Objective: Diversify growth potential beyond Australia and access broader market opportunities.
- Typical Allocation: ~30–35% of the fund.
Example:
- Fund size: $100,000
- International shares allocation: 100,000 \times 32% = 32,000
3. Property Securities
- Investment Focus: Real estate investment trusts (REITs) and listed property companies.
- Objective: Generate income and potential capital appreciation from property markets.
- Typical Allocation: ~10–15% of the fund.
Example:
- Fund size: $100,000
- Property allocation: 100,000 \times 12% = 12,000
4. Infrastructure Securities
- Investment Focus: Global and domestic infrastructure projects, including utilities, transport, and energy assets.
- Objective: Provide stable cash flows and long-term growth potential.
- Typical Allocation: ~10% of the fund.
Example:
- Fund size: $100,000
- Infrastructure allocation: 100,000 \times 10% = 10,000
5. Fixed Interest
- Investment Focus: Bonds and other fixed income securities.
- Objective: Provide defensive exposure to reduce overall portfolio volatility.
- Typical Allocation: ~5–7% of the fund.
Example:
- Fund size: $100,000
- Fixed interest allocation: 100,000 \times 6% = 6,000
6. Cash
- Investment Focus: Cash deposits and short-term bank securities.
- Objective: Preserve capital and provide liquidity for the fund.
- Typical Allocation: ~3–5% of the fund.
Example:
- Fund size: $100,000
- Cash allocation: 100,000 \times 4% = 4,000
Table: Commonwealth Growth Fund Asset Allocation Summary
| Asset Class | Typical Allocation (%) | Example Allocation on $100,000 |
|---|---|---|
| Australian Shares | 35–40% | 35,000 |
| International Shares | 30–35% | 32,000 |
| Property Securities | 10–15% | 12,000 |
| Infrastructure | 10% | 10,000 |
| Fixed Interest | 5–7% | 6,000 |
| Cash | 3–5% | 4,000 |
Conclusion
The Commonwealth Growth Fund focuses on maximizing long-term capital growth by allocating the majority of its portfolio to growth assets, while maintaining a smaller portion in defensive assets to manage risk. Understanding this asset allocation enables members to align their investment strategy with their retirement objectives and risk tolerance, ensuring a suitable balance between growth potential and portfolio stability.
