Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 216

2. Drilling down into latest SMSF allocations

There is a long-running debate about SMSF exposure to global equities, driven by the misleading interpretation of the data issued by the Australian Taxation Office. The ATO only lists direct holdings on global exchanges in its international equities allocation, and this number misses the billions held by SMSFs in managed funds, Exchange Traded Funds and Listed Investment Companies. Drilling into the actual fund data, SMSF allocation to international equities is about 7%, which is one-third of the 23% allocated by large institutional funds, but much higher than the 1% suggested by the ATO data.

Drilling deeper into the listed trust allocation

Compensating for the ATO data weakness is the Class Limited SMSF Benchmark Report. We have early access to the June 2017 numbers compiled from over 130,000 SMSFs using de-identified fund-level data. Initially, for consistency with the ATO data, Class uses the same asset allocation categories, as shown below.

Class also provides the asset value ranges of SMSFs, showing some very small and very large balances but two-thirds in the $200,000 to $2 million bands.

Where the first chart above reports listed shares at 29%, like the ATO data, the vast majority of these shares are listed on the ASX. It is the unlisted trusts category at 17.7% of assets and the listed trusts at 4.5% of assets where the global equities lie. In these SMSFs, managed funds comprise 11.5% of assets, with 32% of SMSFs holding some type of managed fund.

The asset exposure of the Top 20 managed funds is 58% international equities, 10% Australian fixed interest, 9% cash, 8% global fixed interest and 5% listed property. Only 8% is Australian equities. A 58% allocation of the 11.5% in managed funds places 6.7% in global assets.

As shown below, the Top 20 managed funds are prominent in many SMSFs, with about a quarter of SMSFs with managed funds holding investments with either Magellan or Platinum.

Direct equities by security

The Class data reports the largest asset allocation is to listed domestic equities (including listed trusts) at 37% of SMSF assets, with a place in 68% of all SMSFs.

The domestic listed assets comprise:

  • Shares 78.5%
  • Debt and hybrids 9.0%
  • Stapled securities 6%
  • ETFs 5.9%
  • Other listed trusts 0.6%

The following table shows the Top 20 shares in SMSF portfolios. Over half of all SMSFs that hold domestic shares have experienced the Telstra pain of a halving in the share price and cut in dividend. The banks make up over half the investments in the Top 20, with Westpac overtaking BHP in the last quarter.

Graham Hand is Managing Editor of Cuffelinks. Exclusive access to the Class SMSF Benchmark Report for June 2017 was provided by Class Super.

RELATED ARTICLES

Which shares and funds do SMSFs invest in?

What is happening with SMSFs? Part 2

Meg on SMSFs: Withdrawing assets ahead of the $3m super tax

banner

Most viewed in recent weeks

Australian house prices close in on world record

Sydney is set to become the world’s most expensive city for housing over the next 12 months, a new report shows. Our other major cities aren’t far behind unless there are major changes to improve housing affordability.

The case for the $3 million super tax

The Government's proposed tax has copped a lot of flack though I think it's a reasonable approach to improve the long-term sustainability of superannuation and the retirement income system. Here’s why.

Tariffs are a smokescreen to Trump's real endgame

Behind market volatility and tariff threats lies a deeper strategy. Trump’s real goal isn’t trade reform but managing America's massive debts, preserving bond market confidence, and preparing for potential QE.

The super tax and the defined benefits scandal

Australia's superannuation inequities date back to poor decisions made by Parliament two decades ago. If super for the wealthy needs resetting, so too does the defined benefits schemes for our public servants.

Meg on SMSFs: Withdrawing assets ahead of the $3m super tax

The super tax has caused an almighty scuffle, but for SMSFs impacted by the proposed tax, a big question remains: what should they do now? Here are ideas for those wanting to withdraw money from their SMSF.

Getting rich vs staying rich

Strategies to get rich versus stay rich are markedly different. Here is a look at the five main ways to get rich, including through work, business, investing and luck, as well as those that preserve wealth.

Latest Updates

SMSF strategies

Meg on SMSFs: Withdrawing assets ahead of the $3m super tax

The super tax has caused an almighty scuffle, but for SMSFs impacted by the proposed tax, a big question remains: what should they do now? Here are ideas for those wanting to withdraw money from their SMSF.

Superannuation

The huge cost of super tax concessions

The current net annual cost of superannuation tax subsidies is around $40 billion, growing to more than $110 billion by 2060. These subsidies have always been bad policy, representing a waste of taxpayers' money.

Planning

How to avoid inheritance fights

Inspired by the papal conclave, this explores how families can avoid post-death drama through honest conversations, better planning, and trial runs - so there are no surprises when it really matters.

Superannuation

Super contribution splitting

Super contribution splitting allows couples to divide before-tax contributions to super between spouses, maximizing savings. It’s not for everyone, but in the right circumstances, it can be a smart strategy worth exploring.

Economy

Trump vs Powell: Who will blink first?

The US economy faces an unprecedented clash in leadership styles, but the President and Fed Chair could both take a lesson from the other. Not least because the fiscal and monetary authorities need to work together.

Gold

Credit cuts, rising risks, and the case for gold

Shares trade at steep valuations despite higher risks of a recession. Amid doubts that a 60/40 portfolio can still provide enough protection through times of market stress, gold's record shines bright.

Investment strategies

Buffett acolyte warns passive investors of mediocre future returns

While Chris Bloomstan doesn't have the track record of his hero, it's impressive nonetheless. And he's recently warned that today has uncanny resemblances to the 1990s tech bubble and US returns are likely to be disappointing.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.