HESTA's 6 Ready-Made Investment Pools allow you to invest in areas that interest you, while leaving key investing decisions to a team of expert managers. Each pool is made up of one or more HESTA Your Choice Asset Classes, creating its own set of objectives and risk/ expected return profile. You can mix and match these in any combination, or add one or more YC Asset Classes. Compare your investment options using HESTA's investment comparator.
Cash Plus
Cash Plus aims for the lowest year-to-year variation in returns of all HESTA's Ready-made Investment Pools, although with the expectation of lower rates of return than Core Pool over the long term. It is the most conservative of all HESTA's pools and is specifically designed to offer a low-risk investment. It aims to provide stable returns slightly greater than those achieved by investing in cash alone.
It has an asset allocation with more exposure to cash and fixed interest markets than other Ready-Made Investment Pools. Almost 30% of its investment is in shares. This is because shares tend to have a low correlation, or relationship, with cash and as one rises in value, the other may be expected to slow. So, by investing a proportion in shares, we help reduce the risk while enhancing the potential return over the longer term. Cash Plus aims to achieve CPI + 3%.
Core Pool
(Unless you have already chosen another investment option, your money is automatically invested in Core Pool.)
Core Pool aims to optimise returns while in the short-term achieving consistently better returns than the 90-day bank bill rate (adjusted for tax) and rarely having interest rates less then zero. It uses the strategy of investing in a diversified but balanced mix of assets to provide a consistent return. The asset mix may vary during the year in accordance with market conditions to help achieve this consistency of return. It's the only pool that holds a reserve, which may be used for rounding purposes. These reserves are targeted to be at least 2% of total assets. Core Pool aims to achieve CPI + 4%.
Shares Plus
Shares Plus aims to provide higher long-term returns than Core Pool. This recognises there is likely to be a substantial year-to-year variation in returns and even in the longer-term Shares Plus may not outperform other pools. It's a diversified option that includes assets other than shares, with more exposure to the share market than Core Pool. However, its diversification means that it has a lower risk profile than an investment in shares alone (such as Australian Share Pool or Overseas Share Pool). Shares Plus aims to achieve CPI +5%.
Eco Pool
Eco Pool aims to optimise long-term returns, while investing in companies that demonstrate best practice environmental/sustainability performance within their industry sector, relative to their peers. Its high allocation to shares means there is likely to be significant year-to-year variation in returns, and although we expect long- term returns similar to Core Pool, it may not outperform other pools (even in the longer term).
It invests in Australian shares, international shares, Australian direct property and cash. The Australian shares component is selected via an environmental screen, while the international shares component is screened according to economic, environmental and social criteria. Companies are then evaluated and rated for environmental management/sustainability practices within their sector. After being assessed for their financial performance, investments are made in the best-rated companies in each sector. The property investment is expected to be rated a minimum four green stars under the Green Building Council Australia's guidelines and is considered a defensive asset. Eco Pool aims to achieve CPI + 4%.
Overseas Share Pool
Overseas Share Pool aims to achieve higher long-term returns than Core Pool and Shares Plus by investing purely in international shares, including small companies and emerging markets. However, with the prospect of increased returns comes a high level of risk and more year-to-year variation in performance is likely. It therefore has a higher exposure to overseas share markets than other pools. However, diversification is achieved by investing across many different markets and countries. Overseas Share Pool is also more aggressively managed than most other HESTA options (including Your Choice share options) and therefore has a higher risk profile than the YC International Shares asset class. This product may include managers that also short sell shares. Overseas Share Pool aims to achieve CPI +5%.
Australian Share Pool
Australian Share Pool aims to achieve higher long-term returns than most pools. It is not widely diversified and accepts that the prospect of increased returns means a high level of risk, with more year-to-year variation in performance. It invests in Australian shares, including small companies. This impacts on the diversification of the pool and, combined wih an aggressive investment management strategy, means it has the highest risk profile of all pools (including Your Choice share options). It may at times hold a small percentage of its assets in shares of companies not listed on the Australian Stock Exchange, and may include managers that also short sell shares. Australian Share Pool aims to achieve CPI +5%.