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Strong equity gains a key driver for 2024 performance, says CareSuper
The $53 billion fund’s balanced options saw high single-digit returns in 2024, supported by sharemarket strength.
CareSuper’s MySuper Balanced option delivered returns of 9.6 per cent for the calendar year 2024, outperforming its 10-year average annual return of 7.6 per cent.
Moreover, its Balanced Pension option similarly returned 9.6 per cent over the same period and delivered an average annual return over 10 years of 8.1 per cent. According to CareSuper, this ranks it among the top 10 balanced options over 10 years to December 2024.
“2024 saw strong equity gains, driven by a resilient economy and easing inflation. Investors were encouraged by robust US economic performance, healthy corporate earnings and AI’s potential to boost productivity,” the fund said in its latest performance update.
As such, CareSuper said its Overseas Shares option enjoyed 19.51 per cent returns over 2024, fuelled by the US market and tech stocks.
Meanwhile, the Australian sharemarket gained 11 per cent last year, led by major banks like CBA, up 37 per cent.
“However, it lagged other developed markets due to lower growth and persistent inflation. The cost-of-living crisis weighed on business and consumer confidence, keeping corporate earnings flat,” the fund said.
“Fixed interest markets posted positive returns despite volatility, as investors assessed central bank rate cuts. Credit provided solid returns, with higher interest rates benefiting investors. Meanwhile, property markets struggled amid rising rates.”
Looking ahead, it said the global economy is poised to perform well this year, with growth forecast to remain above trend, inflation slowly falling, and many central banks continuing to lower rates.
“The RBA has yet to cut the cash rate but may do so this year as inflation improves, offering relief to households and businesses. Meanwhile, China’s aggressive stimulus efforts should stabilise the economy and aid its overleveraged property sector,” it said.
Nonetheless, CareSuper said there are considerable risks to this outlook.
Namely, it cited the Trump administration’s agenda to recalibrate global trade through tariffs and other measures to reduce the fiscal deficit, saying that, combined with increased domestic spending and deportations, this could be negative for financial markets and the global economy.
“Meanwhile, China’s DeepSeek, a free AI chatbot rivalling US models at lower costs, threatens the US tech sector, where high-valued stocks have driven equity outperformance,” the fund said.
In November, just after formalising its merger with Spirit Super earlier that month, CareSuper announced it is exploring a “shared future” with a $1 billion fund, the Meat Industry Employees’ Superannuation Fund (MIESF).
The two entities said at that time that they had entered into a heads of agreement. If undertaken, this would add an additional 17,000 members and over $1 billion in funds under management to $55 billion fund CareSuper.
AUTHOR
Jessica Penny
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