Impact of Market Returns on Investment Options
| SDIO | LIO | 100% DIO | 100% GIO | |||||
|---|---|---|---|---|---|---|---|---|
| Mean, μ Percent | Standard Deviation, σ | Mean, μ Percent | Standard Deviation, σ | Mean, μ Percent | Standard Deviation, σ | Mean, μ Percent | Standard Deviation, σ | |
| 2000:2009 | 5.86 | 14.29 | 6.13 | 13.05 | 6.7 | 2.83 | 5.5 | 20.81 |
| 2004:2013 | 8.73 | 15.21 | 8.67 | 13.87 | 6.3 | 3.0 | 8.4 | 22.87 |
Strategic Asset Allocation Benchmarks
| Capital Stable/Conservative | Balanced | Growth | |
|---|---|---|---|
| Cash | 25 | 5 | 5 |
| Australian fixed interest | 35 | 15 | 10 |
| International fixed interest | 10 | 10 | 5 |
| Listed property | 5 | 10 | 10 |
| Australian shares | 15 | 35 | 40 |
| International shares | 10 | 25 | 30 |
Asset Allocation: Single, Diversified (SDIO) & Life cycle Investment Options (LIO)
| Defensive Assets | Growth Assets | |||||
|---|---|---|---|---|---|---|
| Investment option | Cash | Australian fixed interest | International fixed interest | Listed property | Australian shares | International shares |
| SDIO | 5% | 10% | 5% | 10% | 40% | 30% |
| LIO | 7% | 13.5% | 6.5% | 9.5% | 36.5% | 27% |
Cash Flow Based Asset Allocation
| Age 60 | Age 65 | Year 1 & 2 | Year 3 & 4 | Balance | |
|---|---|---|---|---|---|
| ⇧ | 10% Cash | Use Cash | Use Balanced | Retain | |
| ⇧ | 20% Balanced | Retire | Reserve | Reserve | Growth |
| ⇩ | 30% Growth | 10% | 20% | 70% |