In the breakdown of assets underlying Media Super’s investment options, 'Private Markets' are referred to as 'Equity Unlisted'. Other alternative investments in Media Super's portfolio are detailed as 'Other Listed' or 'Other Unlisted'. Media Super's Infrastructure and Opportunistic investments are described separately. For details about the sector allocations of Media Super's investment options that include alternative assets, refer to the individual Options.
what are alternative investments?
Alternative assets generally comprise those investments which do not fit within traditional broad asset classes (that is shares, property, fixed interest and cash). Examples of alternative assets may include absolute return funds (e.g. hedge funds), private markets, infrastructure, opportunistic, etc. Each of these asset classes has a different risk profile. Some alternative assets may be considered to have more growth than defensive characteristics, and vice-versa. Media Super reviews each asset class to determine where it best fits.
what are the risks of investing in alternative assets?
Infrastructure and Private Markets portfolios are generally more exposed to individual investment risk than the more traditional asset classes as there are generally fewer investments in the portfolios. On top of this, these asset classes are exposed to interest rate, market and inflation risk. Hedge Funds aim to eliminate many market-related risks through the use of derivatives, leading to derivative risk, and individual investment risk remains (although this is reduced through the diversification of investments).