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Glossary

1. Return target

Represents the mean annualised estimate of the percentage rate of net return of a representative member that exceeds the growth in the CPI over ten years. CPI refers to Consumer Price Index; an inflationary indicator that measures the change in the cost of a fixed basket of products and services, as released by the Australian Bureau of Statistics.

20 year return target and average return
Hostplus, with our asset consultant, JANA Investment Advisers Pty Ltd ABN 97 006 717 568 AFSL 230693 (JANA) closely monitor and regularly review the performance of each investment as well as individual managers. The Fund views superannuation as a long-term investment to provide retirement benefits to our members and has long-range investment strategies to support this. We have provided the 20 year return target and 20 year average return figures to reflect this approach.

2. Return

 

Represents the net return of a "representative member". The net return of a representative member is the net investment return of a representative member minus administration fees, costs and taxes and minus advice fees, costs and taxes.

This return is the return for a member who is fully invested in the Hostplus Balanced (MySuper) option, who does not incur any activity fees during a year and who has an account balance of $50,000 throughout that year, excluding any investment gains or losses on the $50,000 balance. The "representative member" returns are after administration fees have been deducted and are therefore lower than the published "net fund earning rates" (or net investment returns) which are net of investment-related fees, costs and taxes only.

20 year return target and average return
Hostplus, with our asset consultant, JANA Investment Advisers Pty Ltd ABN 97 006 717 568 AFSL 230693 (JANA) closely monitor and regularly review the performance of each investment as well as individual managers. The Fund views superannuation as a long-term investment to provide retirement benefits to our members and has long-range investment strategies to support this. We have provided the 20 year return target and 20 year average return figures to reflect this approach.

3. Comparison between return target and return

The graph outlines the comparison between the return target and the return for the Hostplus Balanced (MySuper) option for previous financial years.

  • the columns represent the net return (as a percentage rate) of a representative member for each year in the comparison period; and
  • the blue line represents the 10 year moving average return target*; and
  • the orange line represents the 10 year moving average net return of a representative member^.

*The moving average return target for a particular year will be the average of the return target (for the relevant year and previous years) in the comparison period, and will factor in the annual growth in CPI.
^When the orange line is above the blue line then the Hostplus Balanced (MySuper) option 10 year moving average net return of a representative member has outperformed the 10 year moving average return target.

4. Level of investment risk

Represents the estimated number of years in a 20 year period where a negative net investment returns will be incurred.

The "High" investment risk label means that there will be in between 4 and 5 periods of negative net investment returns over a 20 year period that may be incurred. It is based on industry guidance (Standard Risk Measure {SRM}, Guidance Paper For Trustees and SRM, Implementation Guidance For Trustees) issued by the Association of Superannuation Funds of Australia and the Financial Services Council.

The Standard Risk Measure is based on industry guidance to allow members to compare investment options that are expected to deliver a similar number of negative annual returns over any 20 year period.

The Standard Risk measure is not a complete assessment of all forms of investment risk, for instance it does not detail what the size of a negative return could be or the potential for a positive return to be less than you may require to meet your objectives. Further, it does not take into account the impact of administration fees and tax on the likelihood of a negative return.

You should still ensure you are comfortable with the risks and potential losses associated with this investment option.

5. Statement of fees and other costs

Represents estimated fees and other costs incurred by a representative member with a $50,000 balance in the Hostplus Balanced (MySuper) option for the following year, to June 2017.

Fees and costs for the following financial year have been estimated using indirect investment costs as at 30 June 2016. The investment costs for future years are not currently known and can be higher or lower. Additional fees may apply. In the event we increase our fees we will notify you at least 30 days in advance, and provide updated disclosures on our website.

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