Adelaide Super, a superannuation fund, offers a range of fixed interest (or fixed-income) investment choices to its members. Superannuation funds are Australian government-supported arrangements for Australian workers to save for retirement, which combine a government-mandated minimum percentage of wages contributed by employers with a voluntary employee contribution that offers tax benefits. Superannuation plans are similar to defined contribution plans common in the United States, Europe, and Asia.

Three of the bond fund choices Adelaide Super offers are as follows:

• Dundee Australian Fixed-Income Fund. The investment objective is to outperform the Bloomberg AusBond Composite Index in the medium to long term. The index includes investment-grade fixed-interest bonds with a minimum of one month to maturity issued in the Australian debt market under Australian law, including the government, semi-government, credit, and supranational/sovereign sectors. The index includes AUD-denominated bonds only. The investment strategy is to match index duration but add value through fundamental and model-driven return strategies.

• Newcastleton Australian Bond Fund. The fund aims to outperform the Bloomberg AusBond Composite Index over any three-year rolling period, before fees, expenses, and taxes, and uses multiple strategies, such as duration, curve positioning, and credit and sector rotation rather than one strategy, allowing the fund to take advantage of opportunities across fixed-income markets under all market conditions.

• Paisley Fixed-Interest Fund. The fund aims to provide investment returns after fees in excess of the fund’s benchmark, which is the Bloomberg AusBond Bank Bill Index and the Bloomberg AusBond Composite Index (equally weighted) by investing in a diversified portfolio of Australian income-producing assets. Paisley seeks to minimize transaction costs via a buy-and-hold strategy, as opposed to active management. The AusBond Bank Bill Index is based on the bank bill market, which is the short-term market (90 days or less) in which Australian banks borrow from and lend to one another via bank bills.

Rank the three fixed-income funds in order of risk profile, and suggest a typical employee for whom this might be a suitable investment.