GENERATE INCOME

CHART 2: ASSET CLASS INVESTMENT RETURNS FOR THE 10 YEARS TO 2014
8%
7%
6%
7.1
7. 4.
7.6
7.0
6.2
6.2
6.5
7.8
6.8
6.9
5.3
5.3
5.5
5.4
5.4
Returns (%p.a)
5%
4%
3%
4.9
3.4
3.4
2.8
2.9
4.6
3.5
4.7
Gross return
After tax lowest marginal tax rate
After tax top marginal tax rate
Superannuation
2%
1%
0%
Australian
Shares
Residential
Investment
Property
1.6
1.3 1.3
0.8
Australian REITs
Australian
Bonds
1.8
Cash
Overseas Shares
(hedged)
Overseas shares
(unhedged)
Source: Russell Investments / ASX Long
Term Investing Report June 2015
Note: All returns are net of costs. Past
performance is not a reliable indicator of
future performance
10 Year Investment Returns - after tax and after costs
Over the 10 year period, Australian shares were the best performing asset
class at the lowest and highest marginal tax rate with returns of 7.4% p.a.
and 5.3% p.a. respectively. Hedged overseas shares produced the second
highest returns of 6.8% p.a. and 5.4% p.a. at the lowest and highest marginal
tax rate respectively.
In an environment of historical low interest rates globally, Australian bonds
have produced returns of 5.3% p.a. and 3.4% p.a. respectively.
4