AFR: Why superannuation funds are wrong on gold
https://www.copyright link/wealth/personal-finance/why-superannuation-funds-are-wrong-on-gold-20240429-p5fngcAiding CPI+ return objectives
Super funds are subject to various performance measures, particularly the fund’s own target return for members (typically CPI plus 3 to 4 per cent over rolling annual periods).
The inclusion of gold could help meet this objective and protect the real value of members’ savings over time, particularly during extended stagnation periods when shares and bonds both underperform.
During the 1970s, diversified funds would have failed to reach even a modest CPI+ target without including gold in their allocation. If stagflation continues, this historical pattern may resurface, leading large super funds to depart from their real return objectives.
