Double-digit super returns despite volatility
Share markets may have turned volatile in recent months, but superannuation fund members should still enjoy solid double-digit financial year returns, according to ratings and research house Chant West.
Chant West principal Warren Chant said early estimates suggested that the median growth fund (61 to 80 per cent allocation to growth assets and the option in which the majority of members are invested) would post a return of about 15.5 per cent which would be the second highest single financial year return in the past 16 years.
He said the 2012/13 result would be the fourth consecutive positive financial year return, following on from 10.4 per cent in 2009/10, 9.2 per cent in 2010/11 and 0.5 per cent in 2011/12.
"The cumulative return over that period works out to 40 per cent," he said.
"That translates to 8.8 per cent a year, which is well above the typical growth fund objective of 6.5 per cent to 7 per cent a year."
Chant said that while the median this year would be about 15.5 per cent, some funds would have done better than others.
"We're expecting that the range of returns within our Growth category will be from about 10.5 per cent to 18.0 per cent," he said.
"Generally speaking, the better performers will be those that maintained fairly high exposures to listed shares and property and positioned themselves to benefit from a lower Australian dollar."
Recommended for you
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
The second tranche of DBFO reforms has received strong support from superannuation funds and insurers, with a new class of advisers aimed to support Australians with their retirement planning.
