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Pocket the world’s most promising companies.

We’ve designed 3 ready-made investment portfolios for you to choose from. Each one blends cash, direct shares, ETFs, in-house managed funds and specialist funds from around the world. That means you can own a small part of literally hundreds of companies — like Samsung, Alibaba or Nintendo — with a single transaction and just $10,000.




Why diversify?

Diversification is about reducing risk. It is impossible to predict market movements, but you can reduce their impact by diversifying your portfolio. This means your savings are spread across different ‘asset classes’, such as cash, property, shares and bonds. This can prevent the value of your portfolio from rising and falling with the performance of a single asset type. A fall in the value of shares may be offset by gains in the value of property.

How we diversify.

We believe we offer the most robust diversification available in a ready-made investment portfolio. We diversify in several ways:

  1. Across asset classes
    Your portfolio includes Australian and international shares, property and infrastructure, alternatives, Australian and international bonds and cash.

  2. Within asset classes
    Within any asset class, we spread the risk further by investing in different industries - such as mining, retail, banking, pharmaceuticals and biotech.

  3. Across countries and regions
    Geographic diversification reduces your exposure to the performance of a single country or region. Your savings are invested across Australasia, Japan, Asia, North & Latin America, the UK, Europe, Africa and the Middle East.



Put your eggs in over 1,000 baskets.

We believe we offer the most robust diversification available in a ready-made investment portfolio.

The chart above displays the asset allocation and underlying investment holdings of the model portfolios as at 2 July 2017. These allocations are actively managed within the allowable ranges and these may vary depending on market conditions.


1. The exchange traded funds (ETF) 2. Managed funds investments Only the top 10 underlying holdings are displayed for exchange traded funds (ETF) and managed funds and are based on publicly available information as at 6 June 2018. For Bond and Fixed Interest ETFs, no underlying investment information is provided.

The chart above displays the asset allocation and underlying investment holdings of the model portfolios as at 2 July 2017. These allocations are actively managed within the allowable ranges and these may vary depending on market conditions.


1. The exchange traded funds (ETF) 2. Managed funds investments Only the top 10 underlying holdings are displayed for exchange traded funds (ETF) and managed funds and are based on publicly available information as at 6 June 2018. For Bond and Fixed Interest ETFs, no underlying investment information is provided.

The chart above displays the asset allocation and underlying investment holdings of the model portfolios as at 2 July 2017. These allocations are actively managed within the allowable ranges and these may vary depending on market conditions.


1. The exchange traded funds (ETF) 2. Managed funds investments Only the top 10 underlying holdings are displayed for exchange traded funds (ETF) and managed funds and are based on publicly available information as at 6 June 2018. For Bond and Fixed Interest ETFs, no underlying investment information is provided.

Get an impressive return on your savings.

Growth portfolio Growth
8.50 %
Balanced portfolio Balanced
6.83 %
Cautious portfolio

Cautious

4.89 %
See the risks

As at May 2018, past performance does not necessarily indicate a financial product’s future performance. Inception date is 30 June 2012. How did we calculate past performance?

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Low High Range details

This is a forecast not a prediction. The projected balance and results are only estimates, the actual amounts may be higher or lower. This forecast is general information only and does not consider your personal circumstances. How is this calculated?

Your forecast

The balance is likely to be between and . This takes into account inflation, fees and tax.

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All our Portfolios are a careful blend of cash, direct shares, ETFs, in-house managed funds and specialist funds from around the world.

We manage our portfolios actively. Over time the asset mix can and will change. These are the holdings as at 2 July 2017.

All our Portfolios are a careful blend of cash, direct shares, ETFs, in-house managed funds and specialist funds from around the world.

We manage our portfolios actively. Over time the asset mix can and will change. These are the holdings as at 2 July 2017.

All our Portfolios are a careful blend of cash, direct shares, ETFs, in-house managed funds and specialist funds from around the world.

We manage our portfolios actively. Over time the asset mix can and will change. These are the holdings as at 2 July 2017.

No one can predict the future. Having said that, we commit to a high degree of accuracy and transparency in our forecasts. This is why our returns may look lower than many of our competitors’.

Here’s how our forecasts are different:
  • We consider good and bad market scenarios instead of assuming a consistent annual return, like 7%. Consistent returns are impossible.
  • Our engine generates at least 500 simulations of what may happen to a portfolio over a given time period. Each simulation includes up and down markets of various lengths, intensities and combinations. We then chart the middle band to give you a likely range of outcomes.
  • We go out of our way to highlight your take home returns. That is, the value that remains after tax, inflation and fees have been taken into account. We assume inflation will be 2.6% per year, which has a huge impact on any future savings. What does your current savings strategy deliver once inflation, tax and fees are taken out?

Our Cautious portfolio is designed for people who can invest for 3 years or more. It offers the lowest risk of our three options, but returns are also likely to be lower.

If that suits you, the portfolio may help you to achieve these kinds of goals:

  • Save a deposit for a home.
  • Save for a holiday, renovation or one-off expense.

Since 1 July 2012, the Cautious portfolio’s returns have averaged 4.89% per year. If you had invested $25,000 then, here’s what you’d have had by the end of May 2018:

Past performance does not necessarily indicate a financial product’s future performance. Inception date is 30 June 2012. Based on an investment of $25,000. How did we calculate past performance?

Our Balanced portfolio is designed for people who can invest for 5 years or more. Its objective is to maintain stable returns for people who are willing to accept low to medium risk.

If that suits you, this portfolio may help you to achieve these kinds of goals:

  • Save a deposit for a home.
  • Save for a holiday, renovation or one-off expense.
  • Save up to pay for school fees or start a business.
  • Enjoy lasting wealth in retirement.

Since 1 July 2012, the Balanced portfolio’s returns have averaged 6.83% per year. If you had invested $25,000 then, here’s what you’d have had, by the end of May 2018:

Past performance does not necessarily indicate a financial product’s future performance. Inception date is 30 June 2012. Based on an investment of $25,000. How did we calculate past performance?

Our Growth portfolio is designed for people who can invest for 7 years or more. It is designed for people who are willing to bear more risk in order to achieve potentially higher returns.

If that suits you, this portfolio may help you to achieve these kinds of goals:

  • Save up to pay for school fees or start a business.
  • Get long-term growth from an inheritance, settlement or bonus.
  • Save for retirement.
  • Build lifelong wealth as an alternative to property investment.

Since 1 July 2012, the Growth portfolio’s returns have averaged 8.50% per year. If you had invested $25,000 then, here’s what you’d have had, by the end of May 2018:

Past performance does not necessarily indicate a financial product’s future performance. Inception date is 30 June 2012. Based on an investment of $25,000. How did we calculate past performance?

We define risk as the potential for losing money that can’t be made back. While all investments experience ups and downs, our portfolios are designed to smooth the ride by falling less when wider markets fall.

The Cautious portfolio offers the lowest risk of our three options, with a target asset allocation of 70% defensive assets such as bonds and cash.


Cautious
Growth 30%
Defensive 70%

We define risk as the potential for losing money that can’t be made back. While all investments experience ups and downs, our portfolios are designed to smooth the ride by falling less when wider markets fall.

The Balanced portfolio offers a balanced approach with a target asset allocation of 50% defensive assets (like cash and bonds) and 50% growth assets like shares.


Balanced
Growth 50%
Defensive 50%

We define risk as the potential for losing money that can’t be made back. While all investments experience ups and downs, our portfolios are designed to smooth the ride by falling less when wider markets fall.

The Growth portfolio is the most aggressive and highest risk portfolio of our three selections. It has a target asset allocation of 30% defensive assets such as cash and bonds.


Growth
Growth 70%
Defensive 30%
  • All of Morningstar Next portfolios are built holistically using our unique investing approach.

    Each Morningstar portfolio is constructed using a multi-stage process. This means each portfolio draws on our deep global expertise in asset allocation, investment research and portfolio construction.

    We focus on three key activities:

    1. Smarter, active asset allocation

    We actively manage your money. This means we only invest in an asset class, industry or company if it makes sense to do so considering the risk and rewards on offer. We believe this helps you to achieve better long-term returns than wholly passive alternatives like exchange-traded funds (ETFs) or Index funds.

    2. Cost effective and holistic implementation

    We pick smart and cost-effective ways to implement our insights. We use a combination of direct holdings (stocks), exchange traded funds (ETFs), and specialist fund managers to build the best possible portfolio.

    3. Aligned with people, not markets

    We ignore market noise. We don’t get hung up about keeping pace with an index. Instead, we strive to focus on what matters to investors-preserving and growing their savings. We design each portfolio to keep pace with inflation – the yearly rise in the cost of living – plus an additional target based on the risk you’re willing to bear.


  • Yes. The portfolios have been running since 30 June 2012 and each has an excellent track record.

    The Cautious portfolio has returned average annual returns of 4.89% per year since inception until May 2018.

    The Balanced portfolio has returned average annual returns of 6.83% per year since inception until May 2018.

    The Growth portfolio has returned average annual returns of 8.50% per year since inception until May 2018.

    Remember though, that past performance isn’t a reliable indicator of future performance.

    Model performance displayed is calculated after ongoing fees (ad hoc or event specific fees, are excluded) and before tax. Investment performance assumes all income received is reinvested. An individual’s performance will differ from the modelled performance depending on factors such as transaction timing, actual management fees, whether income is reinvested and any divergence from model portfolio weighting.


  • We offer three portfolio options to give investors enough choice to meet a variety of needs without being overwhelming.

    We may add more portfolios over time. We welcome feedback. Please contact Client Support on support@morningstar.com.au or call 1800 316 544.


  • The three portfolios have different objectives, provide different potential returns and best suit different timeframes and goals.

    The Cautious portfolio is the least risky, being most focused on cash and bonds (which make up around 70% of the portfolio), whereas the Growth portfolio is more focused on achieving higher long-term returns by investing in more shares and property (which make up around 70% of the portfolio), which brings with it a higher level of risk. The Balanced portfolio sits between the two offering a mix of both more growth-focused assets such as shares and property and lower risk assets such as cash and bonds.

    Explore the Our Portfolios page to learn more, and if you still have questions please get in touch with Client Support at support@morningstar.com.au or 1800 316 544.


  • A range of assets, including cash, direct shares, exchange traded funds (ETFs), in-house managed funds and specialist funds from around the world.

    You can see a complete list of recent holdings for each portfolio on the Our Portfolios page under ‘What’s in this portfolio?’


  • Each portfolio is diversified, offering a mix of Australian and international shares, bonds, and exchange-traded funds (ETFs) as well as cash, infrastructure, and property. See the Our Portfolios page for the complete list of recent holdings of each portfolio.


  • The portfolios are managed by Morningstar’s investment management team led by Andrew Lill, Chief Investment Officer, Asia Pacific. Andrew brings 22 years of global experience to his role. He’s passionate about our value-based investing approach. Andrew ensures that decisions about each portfolio are driven not by sentiment, but by deep independent research.

    Our local investment management team of 22 brings together over 225 collective years of investing experience. We partner with our global colleagues in Chicago and London to deliver a truly global perspective to managing and selecting investments.


  • No. Praemium Australia Limited is the product issuer and responsible entity for Morningstar Next.

    Praemium is a leading Australian financial services business, listed on the Australian Stock Exchange (ASX) under the ticker ‘PPS’.

    Praemium is a market-leading provider of investment platforms, servicing over 300,000 accounts and representing over $95 billion in funds. More information about Praemium can be found here.


  • The custodian (HSBC Bank Australia Limited) holds the legal title to the interests and assets; however you will retain an underlying beneficial interest in the assets. This means that you will enjoy the benefits of ownership even though title to the assets is in the name of the custodian.

    The assets are professionally managed and held in a separately managed account (SMA) in your name, and can be accessed through the Morningstar Next website only by you, providing you with transparency about the individual investments in your portfolio.


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