Superannuation funds on the cusp of pre-GFC highs
Default-option superannuation funds are close to revisiting their pre-global financial crisis (GFC) highs, according to Chant West and SuperRatings.
The Chant West research - which analysed funds with a 61 to 80 per cent allocation to 'growth' style assets - found that the median default fund was up 6.1 per cent for the first quarter of 2012.
"The median growth fund has returned a healthy 33.5 per cent since markets bottomed in February 2009, and now only needs another 2.5 per cent to get back to the pre-GFC peak reached at the end of October 2007," said Chant West director Warren Chant.
Once that psychological barrier is passed, "people will really start to believe that the GFC era is over", Chant added.
During the month of March default funds returned 1.6 per cent, and "are now up 2.3 per cent for the financial year to date", according to Chant.
Similar research by SuperRatings - which looked at funds with a 60 to 76 per cent allocation to growth assets - found the median return for the three months to 31 March 2012 was 5.72 per cent. The median fund was up 1.49 per cent in March, SuperRatings found.
The "stellar" result for the first quarter of 2012 was even more impressive given "the March quarter wasn't without its bouts of turbulence", stated the SuperRatings report.
The report pointed to concerns about a slowdown in Chinese economic growth and continuing sovereign debt woes in Europe.
"We expect that such uncertainty will remain with us for the rest of the year, however, we have already seen that confidence and performance have been resilient," SuperRatings stated.
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