SMSF asset allocation
At 30 June 2012, the two most significant SMSF asset holdings continue to be in Australian listed shares and cash and term deposits (see appendix 1, table 15). Graph 13 shows that 61% of all SMSF assets were directly invested in these two asset classes.
Graph 13: 2012 SMSF asset allocation
Certain asset types have been amalgamated. See table 15 for the complete list of assets.
End of attention
Graph 14 shows annual shifts of SMSF asset holdings by asset type as a proportion of total assets. From 2011 to 2012 there was a continued increase of 4% to cash and term deposits and a small rise in non-residential and residential real property. There was a 3% shift away from listed shares and a 1% or less shift from all remaining asset types.
Overall, these shifts continue to confirm the flexibility and resilience of SMSF investment strategies.
Graph 14: Change in percentage of total SMSF assets, by asset type
Graph 15 shows the annual shifts in the proportion of SMSFs holding the same types of assets as in graph 14.
A comparison of graphs 14 and 15 shows that, in 2012, assets in cash and term deposits as a proportion of total SMSF assets continued to increase for a second year, while the proportion of SMSFs holding these assets fell. This indicates that over the last two-year period SMSFs are tending to invest larger amounts in cash and term deposits.
For listed shares there was a drop in the proportion of total SMSF assets held and the proportion of SMSFs holding the assets. It is the second consecutive year that the proportion of SMSFs holding listed shares has decreased.
There was a generally a decrease in the proportion of SMSFs holding each of the major asset types, which may indicate an increase in asset concentration. These shifts are likely a result of changes in the economy and certain investment markets.
Graph 15: Change in percentage of SMSF population holding assets, by asset type
At 30 June 2012, 80% of SMSF sector assets were reported as directly invested by SMSFs with 16% invested in trusts and managed investment structures. In 2008, 22% of SMSF assets were invested in managed investment structures, indicating there is a trend away from investing in this type of asset over the five years to 2012.
The remaining investments included overseas and miscellaneous assets such as collectibles, assets held under limited recourse borrowing arrangements, and other assets (see appendix 1, table 15).
In 2012, the distribution of asset types held by SMSFs within each asset range was relatively consistent.31 However as fund asset size increased the proportion of assets in cash and term deposits decreased significantly. Funds across most asset ranges tended to favour cash and term deposits, while those with more than $5 million in assets held a higher proportion in listed shares.
Larger funds tend to have a greater proportion of their assets in non-residential real property and unlisted trusts than smaller funds. However the proportion of assets held in listed shares does not significantly change across assets ranges.
For the year ended 30 June 2012, a comparison of the payment phases of SMSFs shows 35% of SMSFs were in the pension phase and held 53% of reported assets.32 Further analysis shows that the assets held by SMSFs in the pension phase have increased by 8% over the five years to 2012.
In 2012, SMSFs reporting in the pension phase had very similar assets to SMSFs in the accumulation phase (see appendix 1, table 16). The only noticeable difference was SMSFs in the pension phase generally held a greater proportion of their assets in listed shares and less in real property.