Funds hit most by early release perform best over 10 years
Some of the funds that have experienced the most in drawdowns due to the Government’s early release scheme have been the top performers over the last 10 years, according to SuperRatings.
Data from the research house found that the top performers were AustralianSuper, whose balanced option had returned 8.8% per annum over the last decade. This was followed by UniSuper Accumulation Balanced, Hostplus Balanced, Cbus Growth, CareSuper Balanced, and VicSuper FutureSave – Growth Option.
AustralianSuper, Hostplus, and Cbus were three of the top five funds that experienced the highest number of members using the early access scheme.
However, only half of the top performing funds over the last 12 months were among the top performing funds over the 10 years. SuperRatings said this highlighted the difficult for investment strategies to perform well in differing market conditions over the longer term.
Over the last 12 months, the data found that Suncorp was the top returning fund to the end of June with the Suncorp Multi-Manager Growth Fund returning 3.8%. This was followed by BUSSQ and Australian Ethical Super, whose balanced options returned 2.5% and 2.4% respectively.
SuperRatings executive director, Kirby Rappell, said: “Super is a long-term game, so members should avoid chasing short-term results and ensure they are invested in a quality fund with the right investment strategy that is well positioned to deliver for their needs over the course of their working life.
“Importantly, over the long term, returns remain very healthy.”
Rappell noted that 15 out of the 50 options in the SuperRatings Balanced Index generated a positive return in the 2019/20 financial year, which highlighted the quality of the funds.
“Managing risks while delivering a positive return in this environment has been a real challenge, and this is likely to continue through the rest of 2020,” he said.
“…on an absolute basis, members will see their balance move around a lot more than they have previously. Funds have done an excellent job of both managing risk and educating their members on these issues, but more can be done in this space.”
The balanced funds rank by a risk and return basis over the last seven years to 30 June, 2020, saw QSuper at the top. CareSuper, Cbus, VicSuper, and AustralianSuper delivered a higher return over this period but at a slightly higher level of risk.
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